September 2009 Archives

I am teaching a free seminar in Southfield on October 10th, 2009. Probably the last time I will be speaking in public in 2009 on Michigan real estate investing.

Some of the topics I will be discussing:

- How to find, convince and do business with other Michigan real estate investors with a private money LLC company.

- How to get your short sales done really fast without spending hours on the telephone waiting for loss mitigation officers to talk to you.

- How to fund your short sales as cash buys for quick flip to other real estate investors.

- The coming $100 billion dollars foreclosure boom in small apartment buildings and how you can start buying them in your Michigan cities. One of my clients Dennis Fassett is looking to buy a building that just dropped in price a cool $100,000. This is just the beginning of the one in a life time opportunity in Michigan to become cashflow rich.

- What if you get fired tomorrow? Are you doing something on the side to build a business? 15 business lessons I learned in the last 9 years of being on my own that you can use to build a business faster than ever in Michigan.

- Hard money, business credit and non-owner occupied financing is not coming for another 2 years. My backup plan for buying foreclosures without using your own money.

In order to be invited to my free seminar, please help me in a good cause.

A good friend of mine Eric Tomei is hosting a wine tasting in Royal Oak to raise money for Habitat for Humanity which is dear to his heart as this was his late father's favorite charity.

It is $15 per person includes 5 samples of wine, cheese, crackers, and grapes as well as a donation to Habitat for Humanity. Many prizes will be raffled off also.

I would love for you to join me there with your friends or significant other. I will be there all day helping Eric. Come and introduce yourself to me and I will put you on the seminar list.

It is a measly $15 but it might change a family's life in metro Detroit. Plus you and your significant others and friends will have a great time. I guarantee you that.

Also some of the top real estate investing friends and clients will be there. Guys and girls you want to meet because one contact like this can literally change your life.

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Here are the details:
Saturday, October 3, 2009
Time: 6:00pm - 9:00pm
Location: Vintner's Cellar Custom Winery-Royal Oak
(www.royaloakwinery.com)
325 E. Fourth Street, Royal Oak, MI
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If you use Facebook - the event link is here - go there and confirm your self as a guest so Eric can keep a head count. You don't have to pay for tickets there. Just pay them at the door on Saturday, October 3 in Royal Oak.

If you have any questions, email me back or call Nora at 248-561-3535.

Lastly, if you cannot make the event because of prior commitments - I will still appreciate if you can spread the word out about the wine tasting to your friends and mention it on Facebook or Twitter if you use either one of them. Just pass out the link to Facebook event page.

- The days where you can get hard money on decent terms if you had good credit and a stable job history.

- Any hopes to get hard money on ridiculous high rates and fees if you had bad credit.

- Joys of sitting on the Internet and applying, applying and applying and getting, the 50 business credit cards and unsecured credit lines as long you had a pulse, an LLC and a FICO over 680.

- All activity on the Internet from California investors discussing the gold mine of East Side Detroit foreclosures and how it was going to make them millionaires in the next 12 months.

- Mainstream magazine covers from Fortune, Forbes, Money and Smart Money talking about the need of adding real estate (read: condos in FL, NV, AZ) to your portfolio).

- Buyers with bad credit on the edge who cannot get qualified anymore even with decent jobs.

- Buyers who cannot document their income. Self employed plumbers, waitresses and strippers just dropped out of the buyer's pool overnight.

- The idea that worked for 50 years in Michigan - that as long as you worked for a company that makes cars - you have job security for life since as long as there are people, they will need cars.

- The stability of owning an engineering degree in Michigan and the benefits, salary and job security that came with it.

- The idea that you can own a retail business of any kind near a automobile manufacturing plant and do O.K. for the rest of your life. This does breaks my heart, because they are collateral damage in a fight they did not started.

I can fill another ten pages with this.

Change, whether you like it or not, happens.

To us (getting old is a drag); to our personal relationships (wife does not think as highly of me as she used to 10 years ago); families (kids grow up); jobs (they used to be stable back in the days) and it also applies to things you know and do in your business and real estate investing in Michigan.

To say most jobs are worth half of what they were 15 years ago is not an exaggeration. Scary part is to sit and think what your job is going to be worth 15 years from today?

So here is one big question for you: What skills, things, stuff, strategies, knowledge, brain waves you currently own and comfortable with right now that are going to be lost in the fire in the next 12 months?

Even a bigger and more uncomfortable question: what are you going to do about it? What it the plan, resources, people you are lining up as we race toward the end of 2009 who and what are going to replace the things and skills that will be lost in the fire?

Where is the big opportunity that you might be missing out?

Paul Newman was describing the secret behind his 50 year old marriage to Joan Woodward, a strange thing in Hollywood. I say his words also apply to people who start their own businesses. Who can really explain why we do, what we do? We, the true believers, who get up one day and decide, without paying any attention to what is going on in the world, in the stock market, in the economy, to start a business. I never investigated what the economy or Dow Jones was doing on January 10th, 2001 when I incorporated my business.

I would make an argument that is probably dumb. That one should take careful consideration of all the things that is happening in the world, in your industry, what your competition is doing, what the forecasters of the world are saying about what might, could, should, would happen tomorrow... but that is not the way the entrepreneur heart works.

I know it should sound strange and disturbingly reckless to somebody who does not belong to our tribe but it is what it is. You get up one morning and just know, that you have to try it, that you would not be able to go another day if you did not give it a shot.

Could you lose money? Sure. Could you spend all this time learning about a business only to discover that it is not for you? Happens all the time. Could you completely flop and risk your significant other, friends and family snicker at you, both in your face and behind your back? Happened to me several times. Will somebody who you respect, will take you in a corner and whisper to you give up that really you are a good person but nobody thinks this is a good idea. Very possible.

I have noticed that if I tell somebody who is an entrepreneur about something that I tried and it did not work out... their face becomes excited, their eyes glow with happiness and they cannot just stop smiling. I have just made their day. Proved to them that their strategy of not-doing-anything-because-something-bad-may-happen-and-I-might-hurt-myself is valid, that the world is a dangerous place where you can lose money / credit / reputation / respect of your loved ones if you go out and try something new that you have not and you may fail.

I don't mind. Really. They are right in their own way and for their own life. They don't get to taste the bitter defeat of hearing 'NO", of seeing a deal fall apart for no logical reason, to try out a new marketing campaign and to see it fall flat on its face, to put out a new website that doesn't convince even one person to do business with you.

They are right in staying behind the walls and not venturing out. But they, who don't belong to our tribe, also don't get to share the insane joy of seeing a business grow, they don't get to open up their emails and read the testimonials of happy clients, the rush of seeing a tactic work perfectly after 10 tweaks and knowing that we did this, inch by inch, all by ourselves.

Lust operates without reason. Patience requires planting seeds every day. Lust defies explanation. Patience and everyday boring progress silences all skeptics eventually.

50 year marriages are not easy. Getting rich is not easy. Running a business is not easy. Raising children is not easy.

Since we are at it... name one thing that is worthwhile doing in a short life which is easy?

"I am convinced that in our society, people that can articulate common sense are hailed as geniuses. I have never felt it more so than working in real estate where common sense is as rare as non-owner occupied bank financing..."

Doug "The Lansing Real Estate Guy" Benson

PS: I have been laughing for a few minutes now since I read this. Thought you might like it too.

Allan Boike and Steve Londeau of Property Solutions of Michigan

Last week Allan Boike and Steve Londeau, two real estate investors who operate a short sale negotiating service for real estate investors, real estate agents and real estate brokers in Metro Detroit area stopped by my office.

These guys are doing some interesting things and have been in the trenches in the real estate investing game for a long time in Michigan. I grilled them about their business and recorded a quick interview.

Here are some of the big things we talked about:

1. What are they hearing while talking and negotiating deals with Loss Mitigation officers every day?

2. How are they selling their own deals even is expensive cities in West Bloomfield really fast?

3. How do they work with real estate agents and brokers so they don't lose out on their commission when banks discount?

4. How come they decided not to charge anything upfront to real estate investors in Michigan for negotiating short sales while everybody else is doing it?

5. My favorite part: What they recently heard on a conference call with some of the top loss mitigation officers of big bank about what banks are planning with regards to negotiating discounts? It will make your head spin.

6. The biggest mistake Allan sees new real estate investors in Michigan make every day? And yeah I made it too and so did Allan but hopefully you will learn from our lessons.

Here is the link to their interview in MP3.

Also their website is here. But please before you call them and drive them crazy with your Short Sale questions, download my interview and listen to it.

A very good friend of Nora's is going through some difficult times right now regarding money. She came to our house, three months ago, and had a frank discussion with us. Wants desperately to get out of her current situation. Wants to make more money than the $8 per hour she is making right now. No skills. No education. No cash. Has good credit though.

Based on what she was telling me about herself, I came up with a very low cost, start from home type of a business for her, which I know for a fact, is working for several people outside Michigan. Cost of startup was less than $3,000. She was nervous about putting that on her credit cards, "What if I lose that money if my business does not works out? What would my husband say?"

I told her that we would help her, write her a check for $3,000 as an interest free loan, would loan her my assistant to do all the grunt work for a month on my payroll and actually sit down and write her the first 30 day plan. Tears of happiness were streaming down her face when she left. I emailed her a list of around 10 Things-To-Do-Before-Launch the next day and told her to call Nora once she was ready and we will pull the trigger.

That was almost three months ago. So far no phone call. No email. According to Nora, she is working, in a different job right now, night shift, 10pm to 6am, five days a week right now for $9 hour at Wal-Mart while taking care of her two kids during the day.

Why?

There is thought that owns her, despite all the resources, help, knowledge offered to her, which says, "I will fail, lose money and my credit score and my family especially my brother and sister will laugh at me." That thought owns her. Completely. Buy books, go to seminars, watch The Big Idea With Donny Deutsch as he lines up one successful entrepreneur after another five weeks a night, buy and read the entire Rich Dad series, hang out at blogs on small businesses and attend every single workshop SBA puts out - it does not matter and will not matter till the day she realizes that she has a master and unless she get rids of that, on her own, there is no small business for her, only long tiring nights refilling shelves at Wal-Mart.

I have been asked, so many times, in the last 13 years in Michigan on "When did you come to USA?" Nobody ever asked me, the much better question, "How long did you planned this? How long did you carry this insane dream of coming to America while living in a third world country, 9000 miles away from Detroit?" I had a voice back then too that said to me, that I need to get to USA, that I will get there one day, that it is my destiny, "little" obstacles such as money or education be dammned. That thought of leaving where I was born and coming to America for a better life, had complete ownership of me for a very long time.

The things you own, end up owning you. TD was talking about hard stuff here - cars, houses, couches, clothes etc. But this applies to thoughts also, especially the ones we all carry in our heads, some times by choice, some times without knowing.

It is worth sitting sometime quietly and write down the conversation that you have with yourself all the time. The false assumptions made true by years of practice, inside your head. You don't have to tell anybody but it is good to know, at least for your own self-knowledge if there is a thought, that you own, which actually owns you.

How many times have you heard me say, "Get a website for your Michigan real estate investing business. A really good one."

How about 10,456 times?

How many times have you laughed and said, "Mark you are nuts. Don't have money, time and skills to do all this crazy website stuff."

I must have heard it 10,456 times.

And you know what, I agree with you. A decent website does cost money. You got to find somebody who knows what the heck they are doing and get it done. But you and me both know it that you need one for your business.

That is why today is an excellent day to forget about putting up a crappy website and instead create Facebook Business Fan Page for your Michigan real estate investing business. No computer skills or HTML knowledge required. Point and click and within 10 minutes you will be the envy of all at your next REIA meeting.

Start here:

You Can Create your Facebook Business Fan Page in 1 Minute:

It is free. Completely and utterly free. Go to Facebook.com. Look at the picture below.

Click where the red arrow is pointing. Look at the next picture.

The option of Local Business is selected already. Choose Local Business from the drop down box. Type up whatever name you want for this Page. Type up the gooblydook text to make sure that you are not a robot. Type in your name and click CREATE PAGE. If you are not a Facebook user it will ask you to create a free account. If you are already using Facebook it will ask you to login with your email and password.

Your Personal Profile and Information Is Not Displayed At Your Business Page:

Already using Facebook to share pictures and memories of your family with your siblings, grandparents and friends? Scared that hundreds of complete strangers will be looking at your kid's pictures? Hey I got three kids too and I like my privacy also.

Facebook is smart enough to separate both Personal and Business Fan Pages. Do you know who runs Starbucks Business Fan Page? I have no idea because Facebook does not display that information on the Business Page. Unless somebody actually searches for your name on Facebook and then sends you a Friend invite which you have complete control of accepting or rejecting - well they cannot see anything.

Side note: If you have been using Facebook for a while than skip this paragraph but if you are starting out listen up - when you upload personal pictures etc, Facebook asks you very nicely who do you want to be able to see these pictures? Your Friends, Friends of Friends, or Everybody? If you are not sure... just choose Your Friends. So now ONLY people you allow in your personal circle can see what is and should be private to you. It is not hard. Just an option to select.

It will put your business in front of new people:

We all live in our little bubbles. Home, work, Starbucks, play, worship, family, weekends - the whole week is planned and everybody locked and ready. I was listening to 950AM while driving to a meeting a month ago and they said that 55% of married couples actually set a date and time to have sex. I don't know if I should be happy here that people are so committed to getting laid that they are setting a date ahead or be depressed that sex is in the same list as cut grass. But that is another blog post for another day.

The reality of our busy lives is this: if you work for somebody else than 50 hours are pretty much spoken for. Meeting people on REIA's meeting is great but not every town and county in Michigan has a REIA. Also sometimes you get busy, life gets in your way and you cannot make it to business networking meeting.

And when you do, it does not helps that you are not a natural networker. Dennis made a good point about these tools - Facebook or Twitter - being the first handshake and excellent in breaking the ice. It was cool to meet so many of my blog readers at Internet Strategy Club launch whose faces I knew from Facebook. Honestly I did not get the feeling that they were strangers to me completely.

Once you go on Facebook and people are coming to your Business Fan Page and basically giving you permission to keeping in touch with them what you are doing on a regular basis in your real estate investing business - your business network will grow overnight.

When I first started my business in Michigan, the biggest challenge was - nobody knew me. It was not I was good or bad, smart or dumb but nobody knew me. My solution was running non-stop ads in Detroit News, Detroit Free Press, Macomb Daily, Oakland Press, Ann Arbor News and even Kalamazoo Gazette just to get my name out. I was not trying to sell anything in these ads. Just get my name out so I meet new people and shake hands. Pretty much the same thing that Facebook Business Fan Page will do for your new or old business. I would have given couple of my fingers to have this kind of networking tools at my disposal when I could not afford to make mistakes in running these expensive classified ads.

Show Them What You Are Working On or Want to Work On:

It is one thing to tell potential deal partners or people you can flip a wholesale hour yet another one to actually show them live, breathing deals in Michigan real estate all over Michigan cities. Next time you are working on a house - show them the pictures. This is from Divine Provision LLC - one of my QuickStart Bootcamp Grads, Aaron and Nekia. Check their page out by clicking on the link above if you want to see how to use the pictures of a deal just done effectively.

How about pitching a deal directly to your network. Hey may be some of them might be interested in partnering up with you? How do you know they don't have the connections or resources right now? Here is another great example by one of my Inner Circle members Dennis who kicks some serious ass in single-family rentals in Eastpointe and Harperwood. Inner Circle Insiders joke: if you are driving around in Eastpointe and thinking about buying a rental - please call Dennis and get his permission first.

Dennis here is using his Business Fan Page to put a potential deal in front of your network. Check his page out if you want to see how to do it correctly.

Businesses Is About Follow-up:

Here is the biggest problem most really small businesses owners like us have - we don't do a good follow-up simply because we don't have enough minutes in the day to sit and write good emails, call on all those business cards collected etc during their last seminar outing etc.

But once you set this up and everybody who is shaking your hand is coming over to your Facebook Business Fan Page and hitting One Click to becoming the fan of your business - well every time you are updating your Page with pictures, short messages, videos etc - they automatically see it displayed on their wall.

Here is an example of how I see Dennis and Aaron updates without going to their pages every day.

Be NOT Boring:

How many business cards do you think can I see in a lifetime that say "We Save Houses From Foreclosure" or "We Buy Houses"? If you put in some effort in your Facebook Business Fan Page like my Inner Circle members Mike and Nannette Simmons do in their page by adding videos of their rehabbed deal, you set your business apart from everybody else. Adding video on a website is painful. Even if you use YouTube you have to go to YouTube, grab the embed code and then go back to your website, cut and pate the code, make sure the dimensions are correct etc. It is painful brothers and sisters because I have been there and done that. But here on Facebook Business Fan Page - you upload the video and within minutes it shows up. No code. No programming. No techie mumbo jumbo needed.

Michigan Real Estate Investors Know Other Michigan Real Estate Investors:

Think of it as going to a REIA meeting but a meeting that runs 24/7, 365 days a year and you don't have to meet every new person who is coming in because the people you already met are telling other people about you. When somebody becomes a Fan of your Grand Rapids or Detroit foreclosure buying business - all their friends (Facebook Users typically have 125 friends on an average but I have seen as high as 2000 and as lows as 48) see that THEIR FRIEND, a person they trust and like has Fan up a business fan page and if you name your page right to create curiosity than some of them, not all of them, but some of them who are either active in real estate investing or are curious about real estate investing because they just read Rich Dad, Poor Dad last week - well you get them too. It is the best form of stable, slow, word of mouth marketing working for you.

Everybody is on Facebook:

Once in a while something comes along that everybody ends up using because well everybody else is on it. Back when I came to America and was working in a pager and cell phone store for minimum wage - every young guy was buying a pager to get weekend hookups because guess what? All the girls had pagers.

When cell phones came out and I was trying to convince people to buy a cell phone, they would look at me like I have lost my mind and say, "Why the hell do I need a cell phone? I have a phone at home. Phone at work. And there are payphones. Heck you guys have one right in your parking lot." And I would be stammering and stuttering and mumbling something about emergency use of a cell phone. Believe me it was a big problem for a long time. Nobody had a cell phone. Nobody thought they would need a cell phone. But slowly enough people had bought cell phones, than a point came that everybody who did not had a cell phone, was feeling like complete and total loser. There is a term for this feeling in marketing; it is called "social proof". People do what they see enough other people doing. It sort of absolves them of individual taste decisions. But I digress here.

My point is that when I am hanging out with a friend of mine who does not uses computers too much but she is on Facebook because her sister is on Facebook and her second cousin in Greece is on Facebook and my mother who is 9000 miles away can check her grandkids pictures on Facebook - it has become like email and fax machines.

Businesses use email and fax because every other business they deal with uses email and fax. So if you choose to sit on the sidelines for whatever reason ("who has time to learn all this crap?") you are making your real estate investing business in Michigan lose out on a chance to show up in front of hundreds of people in your Michigan county who are on Facebook right now, interested in real estate investing and may become part of your business network on Facebook.

I am busy.

That is what I told two people at a meeting when they are inquiring about how my day was going. It is a whirl of meetings, writing, phone calls, incoming emails, shaking hands, hiring, managing, and connecting people and dots together. I told Nora that I want to work 7 days a week for the next 24 months. She is not too happy about it. But she understands the importance of what is happening in Michigan and in the broader USA markets right now.

Chinese saying, the first one to ascend to the Dragon Throne always has bloodied hands. I am a first generation immigrant to USA. Nobody standing behind me to catch me if I fall. 24 months. Work seven days. Every day. Throw dirt on the wall and see what sticks. Not for the faint of heart but I have no right to anything that I have not pursed and pursued with bleed-through-my-eyes kind of work. So the question you might be thinking is....

Risk of failure? What is that? Failure is just a word. That is all. Friends will laugh at me? I will get new friends. Significant other think you are nuts. Dump them. Make your fortune and then get back with them with a pre-nup. They will love you even more when you have more to spend on them. Might lose money? They print new dollar bills every day at US Treasury. I will go and get some more. Wasted time walking on the wrong road? Hopefully I was smart enough and not too dumb to pick pointers that will help you when you do find the right road for you. Partners did not do what they were supposed to do? Possible but not life threatening.

When you are in a hurry, and the clock is ticking against you - the smartest thing to do is to do a lot of things and see what sticks. Ask your partners to do lot of things and see what sticks. Talk to a whole lot of people and see who responds. Put your business information (not business cards) and what you can do for them in lots of hands and see what happens. Launch, print, distribute, and tweak on the fly. It might sounds emotionally disturbing but that is how you speed up everything.

Make no mistakes about it: there is an enormous amount of bad news that you and I have already heard in Michigan. Nothing you or I can do about it. How we choose to react to it is entirely up to us. Putting things in motion to gather private money, buy apartments, launch a businesses - your reaction is entirely up to you.

Sitting out of the game is an option also and probably for some people it is a good option. Not for me. I was a lousy student all my school years but I have always been an avid reader of history and I know for a fact that fortunes are made during recessions. Not by the rising tide that lifts all boats but by entrepreneurs who find opportunity while others are heading for storm shelters.

Find which option works for you.

So if you are wondering how my day was today?

My life is a blur and I love it.