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The Reverse Real Estate System

by: Mark Evans DM

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For people currently profiting with the Reverse Real Estate System,
please go here for the recorded mentoring audios: http://www.reverserealestate.com/training (logon/password are required)


Q. Where do I start?

A. That question is the reason we developed the 10-day action plan. Use that as your guide for how to get started…once you get into a daily “flow” of doing your business, you can change it up however you need to.


Q. How does the mentoring work?

A. There are weekly live telecalls that are driven by the questions of those on the call…it’s a very small group, so it is very interactive, and Mark even opens the lines up quite often to allow people to just shout out their questions. Ideally, people will/should fax or email their questions in a day or two before the call so that we can put together a gameplan of what to discuss that will best help everyone involved.


Q. Can I use my VIP Club membership with the Reverse Real Estate System?

A. Our VIP Club and Reverse Real Estate System, depending on the deal, could work very well in tandem together. For instance, look at this deal we did awhile back:

http://www.wholesalerealestatedeals.com/5062DobyLn3.html

This was a deal where our buyer got the deed and simply took over possession/control of the property (no financing involved!). That's great...but a buyer is needed before you can make any money with it. So, this is how you can use the VIP Club AND the Reverse Real Estate System together – buy our deal, put your rent to own buyer into it, wait 12-24 months (at most) and have a 5-figure (usually) payday! All of this plus cash upfront, as their lease option fee – you keep 100% of that plus any monthly cashflow.

Go here to learn more about our Wholesale Real Estate Deals VIP Club: http://www.wholesalerealestatedeals.com/

Also, there are various ways to leverage other investors (those you find or those in our network) to make money on our deals regardless of whether or not they're cash deals or ones like we described above. Once you're a member, we share those "ways" with you and give you the exact tools and websites, etc. in order to make that happen. Success is built through building a list of buyers...both retail and investors.


Q. Will I only be able to get my questions answered on the Wednesday night mentoring calls?

A. The mentoring that comes with the Reverse Real Estate System is geared towards helping everyone at once, which is why we do the open group calls - everyone learns together and gets the benefit of hearing everyone else's questions as well as the benefit of being able to ask Mark questions directly when he opens up the phone lines for everyone to talk freely. More times than not, other people (and their questions) will help you to learn so much faster because they will ask things that maybe you haven't thought of yet, which will put you even farther ahead of the game.

However, if it's a question that you have for a specific deal that's on the table and will fall through if you don't get an answer that same day, that's a different story – and we do handle those types of questions/calls differently due to the time-sensitive nature of real estate investing deals (and there is a dedicated phone line just for that, which is 214-615-6505 ext 9074). For just general "how to" questions, though, that's what the weekly calls are for.

Our personal coaching/mentoring students pay a lot of money for the privilege of being able to call us up at any given time of the day, so it wouldn't really be fair to them if we allowed everyone to have that same access. As much as we would like to be able to do that for every single person, it's just not possible.

Also, remember to take advantage of listening to the past calls...that's what they're there for. I’m sure we’ve covered the topic you’re looking for before. A lot are there now, but very soon all of the calls will have a snippet under each date’s recording on the call webpage that will bullet point what was discussed on that call so you can go thru them and listen to calls that address the specific questions you have. If you have not received your logon information yet, to listen to the recorded calls (past and present), then please submit a support ticket, and we'll get that information to you asap.


Q. Where are the scripts in your System?

A. We actually pulled the scripts out because we don’t use them or believe in them…just have a conversation with people, and they’ll tell you all you need to know. Use the Buyer Lead Form and the Seller Questionnaire as guides to follow, but just have a conversation to find out what their needs are. People can tell if you’re using a script, and it makes them leery of you. Ask them what’s going on and how you can help and then just listen.


Q. I looked at the voiceblast.com website and could not find how to set it up.

A. You have to setup an account with them first – and then you can go about the process of scheduling your call to go out (it walks you through how to do that). The first thing you need to do, though, is be collecting phone numbers that you’ll be calling and saving them into a notepad file (one number per line, with no dashes), as that is how the system will know who to call…when you get to that part of the call scheduling, it will ask you to upload your call list file, which is that notepad file.


Q. I currently have an 800 number. Can I use that service?

A. You could, but we’ve found that it tends to intimidate rent to own buyers (and mark mentions that on the Reverse Real Estate System CDs). Some see an 800# as big, bad, “Corporate America”, and that’s who keep telling them “no”, so they may not call if they think that you’re “one of those” companies. You can always try it and see how your response is…we’re always measuring what we do in our marketing to see what works, what needs changed up, etc. So, since you already have that service, don’t let it go completely to waste, although, it may be better used some other way than to attract buyers. But, again, test it and see what happens since you’re already paying for it…maybe people will surprise you.


Q. Do you think it’s possible that, if I did the right advertising for the websites, that I could get a buyer and seller together, have them close a deal, and make some decent money within a few weeks?

A. Is it possible? Sure...anything's possible. It's all about exposure and consistency and talking to as many people as you can. The more of all of this you put forth, the better your chances.


Q. I need to know where I can locate a seller quickly. My buyer is ready to move and has $30,000 to put down. I have not been receiving any seller leads for two days straight. I advertised using the words that were suggested, and they removed my ad. I posted another one last night. So far, that one has not been removed. What other websites can I go to, for the purpose of advertising, other than FSBO-type websites? My buyer is out looking at homes too.

A. Your ads will get removed from time to time for various reasons. It's the nature of the beast, which is why we always talk about tweeking them to see what will work/pull the most leads, be acceptable for posting, etc. That’s where the consistency/persistence will come in…just keep at it and put as many out there every day as you can.

Your two best bets are going to be talking to other investors as well as mortgage brokers...those two sources will likely produce the fastest results. Don't stop doing other advertising as well...you definitely want to "blanket" your target market as much as you can.


Q. The only problem I am having is getting an understanding as to what is done first, second and third with this system. I got three deals and, because they are in three different states, and I have no Power Teams in place there – this is where my slow down is coming from. I just found a guy in GA through online networking. I have explained to him what I’m doing, and he wants to work with me. Do we call buyers when there are no Power Teams in place already?

A. Absolutely…just get it going. By virtue of getting deals done, you will, inevitably, build your Power Teams in various parts of the U.S. For instance, say you get a Letter Of Intent signed with the GA man (for sake of this example, I’ll assume he’s an investor who wants to keep the property). What you’re going to do now is call around to Realtors and other investors in the area to find out about property values and rents to verify what he’s told you and to make sure it’s a deal that makes sense for you to do. Keep those names/numbers for the next time you have a need for them, and now you’ve just built that part of your Power Team in that part of GA. Next time you get a deal there, you have people to start with to ask questions of. These people may change over time, but now you, at least, have a starting point versus not having anything in place now.

Then, once you verify that it’s a deal you want to do, and you’ve gotten the Letter Of Intent signed, you will start networking and marketing to find buyers, if you don’t already have any lined up for that particular house. You can do this through online forums and discussion boards that allow you to post your information and let others know what you’re doing and/or go to free online classified sites and do the same (refer back to the Reverse Real Estate System manual for examples of these). It is a little more time-intensive in the beginning, but you’re just making it an easier road for you later.


Q. Can you help me understand this process just a little bit more...like how I will work with a seller to get my buyer into their house?

1st) I talk to the seller, and he/she agrees to fax back the signed Letter of Intent (LOI).

2nd) I then tell my buyers to go look at the house.

a) Are they just going to drive by it, at first?
b) Are they going to set up an appointment to look inside?

3rd) Now what happens?

It seems to me that the buyers will go inside the house, have a look at the place and then obviously have a conversation with the seller. Without question, the topic of rent, down payment, etc. would come up, right? What stops the buyer from just writing a check right then and there to the seller for the downpayment (lease option fee), and cutting me out of the deal?

A. First of all, if you worry about what all CAN go wrong, it all WILL all go wrong. Think of it this way, everyone in this scenario has more to gain by working with you and being honest, etc. The buyer...because you have, in your hands, the ability to give them a house. The seller...you're saving him/her from costly marketing and Realtor fees, AND if all goes well, he can make lots more money with you in the future by having you as his go-to person (in the case of an investor), so why would he/she screw that up?

So, when you start worrying about getting cut out, remember that...and if it does happen (and it may…we can’t control that 100%), then cut your losses, move on and never do business with that person again. You can't know what other people will or won't do, so there's no point in stressing over it.

2a) Yes, at first, just have them drive by. Most people can decide if they’re going to like the house by the neighborhood - how close it is to schools, grocery, etc.

2b) When they say they’re interested in the area, then you setup an appointment time for them to see the inside. Now, this assumes that they’ve already talked to your mortgage broker – NO showings until they do!

In the beginning, you should meet your buyers – and the sellers – at the property for showings…just to get a feel for everything. As time moves on, do that less and less and let the sellers do all the work. Plus, putting yourself in the seller’s face, upfront, will make it harder for him to screw you over because now you’re a real person to him.

3) If the buyers like it and agree to all the numbers, which you and the seller have already talked about via the LOI, then it’s time to collect money and assign the LOI to the new buyers, complete the Sales Checklist, go to the bank and move on to the next deal!

In a case like this, it’s ok if the sellers were to talk to your buyers about rent, downpayment and all that anyway. Since you’re just providing the buyer and moving on, the monthly cashflow and end buyout price is of no concern to you (because the seller keeps all that). By the time you’re ready to setup an appointment for them to see the inside, you already have the LOI from the seller, so he can’t very well go and raise the downpayment amount after he’s already signed that. That form is what gets assigned to the buyers, so they’ll see it and call him on it, and then he risks losing them altogether – not likely to happen. As far as money down and per month rent, you should have that conversation with your buyers before you ever send them to drive by the house anyway. If they can’t afford it, what’s the point in them seeing it?

Tell the buyers that the seller pays you…and tell the sellers that the buyer pays us…either way, it’s true. A seller will pay for the convenience of not having to do his own marketing (or pay a Realtor) because you’ve already done it for him. A buyer will pay you for the privilege of home ownership…as long as all of their money down goes towards their purchase and the end of their contract, they don’t care who it goes to upfront.

In paying you, the buyer will have the option of writing two checks or one…if they write one, it’s made payable to YOU and you will then give half of it to the seller once everybody’s in agreement to move forward and the paperwork process (on the seller’s side – rental agreements, etc.) has begun. Don’t forget the Sales Checklist so that you’re covered as far as any liability after the fact (if they stop paying in 6 months, for instance)…all three parties will sign that.


Q. My signs are out and people are starting to call and go to my websites and give me their information. How do I keep in touch and follow up with them all?

A. Once your signs start going up, you WILL get a massive response. What you need to do from there is start filtering them, which is talked about on Disc #2, Track #3. Figure out which ones are the “hottest” to call back and which ones can wait. You do NOT have to call everyone back…help the ones, first, that you know you can help. If there’s time for the others later, then it’s your call as to whether or not to get in touch with them.

As far as how to do that, physically, once the number of leads you have gets pretty big…we recommend you get an autoresponder, if it's at all financially possible. It's a huge help for keeping in touch with your leads because it’s completely hands off…as soon as they enter into the system with their email address, the technology takes over from there and keeps in touch with them consistently and without you ever having to pick up the phone, except to call those buyers and sellers who are most motivated.

The cost really is minimal when you weigh it against the time/energy/stress it will save you in keeping in touch with hundreds of people all at once. Here's a link to the one we recommend and are in the process of switching over to now, actually, for all of our stuff:
http://www.aweber.com/?213238. Is it absolutely necessary to have this…of course not, but it will help you tremendously.


Q. What happens when my buyers ask for a list of homes available?

A. If you have a property list now, great, but if not, don’t panic. Just let them know that your inventory changes almost daily. Your buyers will tend to ask this before they’ve really told you anything about what they’re looking for anyway, so turn it around on them and say something like, “Well, in order to cross-reference our database to see if there’s anything that’s a “fit” for you, I first need to know what it is that you’re looking for…there’s no need for me to send you a list of houses that don’t fit your needs, so let’s just figure that out now and save some time.” I’ve never had anybody say no to this.

So, now you know what they want…you can then call them back, maybe in a couple of hours, and say something like, “Right now, we don’t have anything available that will work, but give my mortgage broker a call to start the process – they just need to talk to you for a few minutes to see where you stand right now is all – and I can begin the process of locating a home for you.”

Remind your buyers, too, that they can be helping in this process by looking for homes themselves as well. They know the neighborhoods in which they want to live, and you can’t possibly know about every house on every street that may be available, so your buyers will be happy to help. First off, buyers love to be involved in the process…after all, it’s for them…I’ve never had anyone say “well, isn’t that your job?” Let them help do the work for you by looking at houses that are “FSBO” or “For Rent”.


Q. How do I hook the buyer up with my mortgage broker so that I can collect the marketing fee?

A. You need to have your buyers talk to the mortgage broker to find out where they stand today and how long it will take them to get financed (your sellers will want to know that so they know how long the mortgage will stay in their names). Sometimes people (our buyers) will tell us that they can’t get a loan, but we have them talk to the broker, and it turns out they can. It does happen occasionally.

You will only get paid a marketing fee if the buyers end up being able to get their own financing now. If not, you can get paid a marketing fee down the road when they finally are qualified to refinance. Of course, that will be up to you to negotiate with the mortgage broker and follow up with down the line to make sure you get paid.

Just make sure your broker knows, going in, that you expect to be taken care of when the deal finally closes. They pay for leads all the time, and you’re only asking to be paid if it closes, so they should be on board. The average payout to a mortgage broker on each deal they close is about 1.5% of the deal, so on a $100k house, they’ll make $1,500 and give you $500 of that (or maybe only $250…whatever you work out).


Q. I found a buyer, so I contacted my mortgage broker and also found a Realtor to work with me in IL. My broker agreed to pay the "marketing fee". However, the Realtor told me that I have to have a Illinois Realtor’s license in order to receive any type of commission even if it's called a "marketing fee". They said Illinois is very stringent, as compared to other states. Would it be a problem to have the Realtor contact the buyer, directly, to find out what their situation is?

A. Personally, I think they're pulling your chain because they don't want to pay it, but it's worth looking into. You can search for any info relating to that on google, I would imagine...there are all kinds of legal sites that should be able to tell you that. I've not had to do that before (we've always just asked our attorney for that kind of information and/or clarification – and he’s never told us it was illegal in any state we’ve done deals in, which is pretty much all over the U.S.), so I don't have any sites to recommend you go to.

If you allow the Realtor to contact the buyer to find out about their situation, you'll be cutting yourself out of the deal for sure. Not only that, but why would you refer your buyers to someone that you know isn’t going to pay you? You need to find another Realtor. People will snake you if you let them...it's sad, but it's true. There's no reason why you can't tell the Realtor yourself what their situation is based on your conversations with them. The Realtor is just trying to cut you out if they're saying they need to talk directly to them at this point...there's no reason for that. But, regardless, we don’t feel this is a Realtor you should be working with anyway.


Q. I still work out all the numbers beforehand (and separately) with both the seller and the buyer, right?

A. You’ll do this before the LOI is signed…if it’s a house that you’re just bringing a buyer to and walking away from (versus taking over the property and keeping it for yourself), then you don’t really care what the purchase price is or what the monthly rent is, etc. – that will be for the seller to tell you what they want it to be. They will get any/all equity and cashflow, not you, so it’s really none of your business what those amounts are. We don’t advise sellers, in a case such as this, on what amounts they should list on the LOI…BUT, if I think it’s highly unlikely that I’ll be able to fill their house due to the rent they’re asking or the buyout price, etc., then I will mention that to them, but I won’t advise them on what to change those numbers to.

However, do keep your buyer in mind. If the rent being charged is low, as compared to the house’s value, but you know they can only afford what they’ll be paying today, then it won’t make sense to put them in that house because they’ll never be able to qualify for the loan due to the payment amount being more than their income supports.

So, if it’s unrealistic to think that the buyer will ever be able to close the deal (ie: refinance the house out of the seller’s name), then find them another house. They’ll appreciate that you’re looking out for them, and you can sleep better at night knowing that you didn’t set them up to fail!


Q. Do I have the seller sign the Letter Of Intent (LOI) with my buyer or with me?

A. The seller will sign the LOI with you, and you will assign that LOI to your buyer once you find a “match”. The LOI states that the holder of it has the option to purchase the property, so you want to give that option over to your buyers for a fee. The main purpose of the LOI is to make you a part of the transaction (a “principal” in the transaction). If you’re not, you could be construed as acting as a Realtor, which would be illegal unless you were licensed as one. This LOI shows that you have an option on the house and that you intend to assign that option to a buyer that you’ll find…all perfectly legal.


Q. On the seller side, am I suppose to be getting the houses under contract or just do a Letter of Intent?

A. It depends on what works best for both you and the seller. Maybe he’s an investor who wants to keep his house but likes the rent to own idea…then you’d use the letter of intent. But, let’s say it’s a homeowner who is moving out of state for their job but has a nearly fully-financed house that they’ll sign over to you via subject to…in that case, you’d use a purchase contract (also in the reverse system). In this latter case, you could then sell that contract to another investor who wants to hold the house to do a rent to own or you could do the rent to own yourself and collect the backend payday when the tenant/buyer refinances in a couple of years. So, the idea is to talk to the seller to find out what his/her true motivations are, what will help them best and then decide which technique works better.


Q. Once I find a seller, how do I keep myself in the deal since the buyer will be going to look at the house and could talk to the seller and do it without me?

A. You have your sellers sign a Letter of Intent (LOI) so that you can market their property to your buyers. That's how you keep yourself in the deal...the LOI is your way of taking an option on the property (thus, making yourself a “principal” in the transaction), and then you assign that LOI/option over to the buyers and collect your paycheck!


Q. The system says, "Just assign the LOI to the buyer." How
is this done?

A. With the assignment form...it's in the Reverse Real Estate System on the forms CD as well as in the manual.


Q. So, do I give the seller the rental contracts that they should use and a filled out copy to show them how to complete them?

A. Yes. Most sellers won’t have their own paperwork, so it’s perfectly ok to offer to give them yours.


Q. So, I just oversee the deal and walk away?

A. Oversee it only in that you do what’s in the above four FAQs and make sure that everyone’s satisfied with the deal and that you’ve gotten paid, etc. After that, you’re out of it, and it’s no longer your concern. Be very careful not to keep in touch with either side afterwards or it could lead to you staying “hooked” into the deal when you don’t want to be. I don’t mean that in a bad way, but people will take advantage of you, if you let them, so a cleaner break is better. I would send a “welcome home” card to your buyers and a “thank you” card to your sellers, but that’s it after that.

The thing is…answering one question after the deal is done could lead to them starting to call you every day with a new question, so just be aware and protect your time accordingly. As you learn and grow, you’ll see that time is your most valuable commodity, and one that you can’t create more of, no matter how hard you try, so protect it well!


Q. How much of a down-payment should I charge?

A. It’s called a "lease option fee" and should always be about 3%-5% of the end buyout purchase price (and this is the amount in which you will be paid from, so the higher it is, the better). If your marketplace calls for a higher percentage as the "norm", then go with that instead (and you’ll find that out in the course of talking to other investors in the area). Remember that 100% of whatever lease option fee is paid will be credited back to the buyer when they refinance the property into their own names.


Q. Should we be flexible with the option fee amount?

A. It should always be at least 3%, but you can be a bit flexible and spread part of it out over 1-3 months time if it helps close the deal and you feel confident that your tenant/buyer will keep to their promise to pay. We would recommend always trying to get the majority of the cash upfront and then spread out the small remaining part over a couple of months.

The thing that people need to understand is that they’re being provided with a huge opportunity here, so they need to “pony up” and not expect this to be just given to them. If the upfront cash requirement is $3,000 and they have $800…well, then they need to keep saving and let you know when they have at least $1,500. Remind them that most apartments won’t let them in for only $800…so how do they think they can have a house for that little? A lot of times it will be a judgment call on how flexible you want to be, so just listen to where they’re coming from and see if there’s a way to make it work. Our only advice here is that you are not running a charity, so don’t fall for every sob-story you hear or you won’t be around very long to help those who are truly ready to change/better their lives.


Q. When you get some buyers and some sellers to fill out their information, how do you then get them together and make money from the deal? Do you ask for a finder’s fee or a percentage? Do you write up a contract between yourself and the buyer/seller, etc.?

A. You really need to know where your buyers are, credit-wise, before you start looking for a home for them. For instance, if someone's going to need 2-3 years (versus 1-2 years) to get their own loan, you don't want to hook them up with a seller that doesn't want to do a long-term rent to own. Knowing what you're working with first will save everyone time moving forward.

As far as starting the search for sellers, we are both huge fans of going to other investors/landlords first...they "get" it, and will be happy to work with you. Not only that, but you’ll create repeat business once they see how quickly you can make things happen. Once you exhaust those options, then move on to "regular" homeowners.


Q. What about the buyers who come to us saying that they have little or no down payment available?

A. Talk to them to see if that's really the case. Do they have friends/family who might loan it to them? Did they know that they can take a one-time, tax-free (we’re not accountants, so please verify this) withdrawal from their 401k plan at work to purchase a house (some plans will only let you borrow this amount, though, instead of truly withdrawing it, so make sure they do their homework on this point)? Could they come up with 1/3 or 1/2 now and pay the rest within the next two months? If all else fails, and they just have nothing available, let them know that this program isn't for them right now and that when they have a couple thousand dollars saved up, let us know. Then, I'd follow up with them with a quick email in a couple of months.


Q. How many properties/sellers and how many potential buyers I should have, in the pipeline, on an on-going basis? I can only spend 5-10 hours a week on my real estate career, as I have a fulltime job.

A. As many as you can get. This isn’t a question we can answer any better than this because it will just depend. Sometimes, you can talk to 5 sellers and/or buyers and get 4 of them that want to work with you, but sometimes talking to 5 other sellers will only net you 1-2 people to work with. It’s a numbers game…just put in as much time as you can and work with whoever gets on board.


Q. I thought that I needed to have a balance of sellers and buyers (both motivated and flexible).

A. You’ll never have an exact balance between the two…you will always have more buyers than sellers or vice versa. I don’t know how that happens, but it just always seems to be the case. It’s not a bad thing, though. It’s not the amount of buyers and sellers you have available that’s important, it’s getting them together and doing the deal. You could have 100 buyers on your list, but if none of them are doing anything, it doesn’t matter. On the other hand, what if you only had 16 buyers in your pipeline, but 7 of them were taking action and were actually going to move forward with you? That is $$$ in the bank.


Q. Do I need to keep calling sellers I find in newspaper ads, websites, etc. What's the most efficient way to reach out to a seller who is willing to do a rent to own? How many NEW sellers and buyers do you guys contact (for marketing purpose) every day?

A. As many as it takes to get as many deals done as you want…but just go for getting *one* done, first, and then go from there.


Q. I’ve got too many sellers in my area. How do I deal with that? Does that mean that the Reverse Real Estate System won’t work?

A. This is a very fortunate “problem” to have...lots of homes for sale means lots of motivated sellers. If not now, it's likely they will become so. What this means is that your opportunity to get lots of rent to own buyers hooked up with them is HUGE! You can approach this three ways, depending on what your long-term strategies are.

1. You can provide a rent to own buyer to the seller, split the option fee and walk away. The seller maintains ownership of the house and gets cashed out when your buyer refinances down the road. In this instance, you don't have the risk associated with holding the property, and you become instantly uninvolved as soon as you are paid...no long-term potential for rent to own tenant/buyer headaches (still not as bad as “regular” tenants, but this option separates you completely from any hassle).

2. You can take the property over (whether you do it subject to or on a straight cash basis, depending on the deal) and keep it for yourself. Then, you put your own buyer in there and collect 100% of the option fee plus monthly cashflow plus the backend equity when they refinance it into their own names.

3. You can do the same as in #2 above, but instead of keeping the property, you immediately sell your contract to another investor who wants to hold the property instead.

Basically, make sure that whatever you do feels like a win/win to everyone. If your investor is happy with the deal, they'll do more with you in the future, so the key is to never be too greedy (by charging high assignment fees or high lease option fees if it’s a house you keep, etc.). Being greedy can be very tempting to do when starting out and wanting to get some big cash hits, but it's probably not going to be worth it in the long run.

Lastly, you'll want to do as much local marketing/advertising as you can (do the free - or low cost - stuff first, of course) stating that you can buy and close fast and are an alternative to the traditional sale in that it won't cost them a cent in commissions...etc. etc. etc. Refer back to the manual on the specific marketing and ad tips. By doing a lot of marketing, your exposure will be huge, and those sellers will know that you’re the person to call!


Q. The sellers I’m working with want to do a rent to own with me and my buyers. The rent they’re asking is $1,600/mo., even though it’s a $300,000 house, which I know will be more like $2,500/mo. when my buyers would eventually get their own loan. The $1,600/mo. is all they can afford, though, so I’m not sure if I should move forward with hooking them up.

A. No…they simply can’t afford that house…move on. Remember that you can’t help everyone every time. You’re correct to think ahead. If people are only charging $1,600/mo. in rent for a property that’s, realistically, going to cost someone $2,500/mo. in the long-run, then you’d be setting your buyers up for failure by letting them move in. not only that, but you’d be doing everyone involved in the transaction a disservice because the loan will never get refinanced/sold to this person – the seller won’t get their house sold, and the buyer will lose the home they’ve likely grown to love over the past year or two.


Q. Is there any way you can benefit from a deal when a buyer contacts you about a rent-to-own property and wants to buy it outright with a loan?

A. Absolutely. You refer them to your mortgage broker to do the loan who will pay you a marketing fee when it closes. If need be, you can even refer them to a Realtor (in a situation where they don’t already have a house picked out) and get paid another marketing fee.


Q. People who are calling on my ads need to move right away, so I need to have rent to own properties available and on-hand at all times…how do I do this?

A. As you start talking to sellers more and more, you will have more properties on-hand to work with in a quick manner. You’ll develop relationships with other investors that you can call on at any given time to ask what they have available…and, therefore, you now have “inventory” to offer your clients who are in a hurry to move. In the meantime, if you only have one active buyer that you’re working with, I’d drop everything and get a deal together for them (assuming they have money to put down, that is) so that you can get paid.

Get them in touch, ASAP, with a mortgage broker to see how bad their credit is and to see how long it’ll take them to be in a position to get their own loan. People say they have bad credit all the time, but it’s sometimes not quite as bad as they think, and it’s really cool when you get to tell someone that they can get a loan now when they thought they couldn’t.


Q. Do I need to have a qualified buyer lined up before I talk to sellers?

A. No – never stop talking to either side. You need to constantly be talking to both buyers and sellers at all times.

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Met Rivers metrorivers@bellsouth.net

I have been seriously thinking about purchasing a different real estate course before I read this Q&A page. I really intrigued by the concept of marketing for your deals. Now, I'm not so sure I will get the other course, I'm now leaning heavily towards this system instead.

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