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Getting Started As a Real Estate Investor

by William Bronchick, J.D.   

Whether you are new to real estate investing, or you have just reached a "plateau" and need some ideas, these reminders will help "jump-start" your real estate investing career and get you back on track.

Surround yourself with like-minded people

"Creative" real estate is non-traditional, which means that most people don't do it this way. Thus, most people you speak with will tell you it won't work. If you tell them you heard it in a seminar or a course you bought from a late-night television "guru," they will laugh and call you "gullible."

Attorneys and other professionals will denounce it because it sounds unusual. Keep in mind that these people are either threatened by their own lack of success or are looking to protect their own butts.

The first thing you should do is join a local real estate investment club. [Here is a state-by-state listing: Real Estate Investment Clubs.] These associations will help you keep your thoughts in the right place and prove to your subconscious that it really does work--despite the opinions of 20/20, Dateline, 60 Minutes, and other "consumer watchdogs."

If you cannot find a group, form a "mastermind" group that meets for breakfast once a week. If you don't know what a mastermind group is, you should read Think and Grow Rich by Napoleon Hill. If you have read it already--read it again, again and again.

Have a team

Don't wait until you have a deal brewing to find the players. You need to find the following players on your team right now:

  • Attorney
    Preferably one who does real estate deals for himself as well as others.

  • Title or Escrow Company
    Stay away from the big name companies, and find one that caters to investors. Make sure they understand double closings, land contracts etc.

  • Insurance Agent
    Find one who understands land contracts, landlords, etc.

  • CPA
    Find one who is aggressive and owns real estate.

  • Contractor
    One who will give you free estimates and knows how to "cut corners" in the right places.

  • Mortgage Broker
    One who is savvy, creative, and experienced with investors.

  • Partner
    In case you need one for money or experience.

  • Mentor
    Someone you can call to smooth out the rough spots.

Don't talk to unmotivated sellers

This is the biggest mistake I see beginning investors make. They waste time talking to sellers who are marginally motivated. Even worse, they drive by the house and look for comps without even talking to the seller first! Never visit a house before speaking with the seller over the phone.

I love Ray Como's Mastermind Script Book. It has hundreds of questions designed to extract the seller's motivation over the phone. Heck, the course will save you enough gas money to pay for itself! [For more ideas read: How to Make Sure the Seller is Really Motivated]

Be persistent

Anyone who has ever been in sales will tell you that few deals are ever made on the first try. In fact, most deals are made after contacting a prospect for the fourth or fifth time.

Let me give you an example. I contacted a guy who had a junker house he was thinking of selling. I met with him once and made him an offer. He didn't like it. Did I stop there? No way! I called him twice a month for a year. I mailed him two more offers that he rejected. We finally came to an accord and closed this month.

Have a follow up system like a salesman. I use a program that allows me to schedule follow ups and keep a running history of calls and conversations.

Keep educated

"If you think education is expensive, try ignorance." I am not sure who first said it, but I give him credit. You can lose more money with a mistake than you can learning how to avoid one. Even if you have been at this business for years, you need to keep up with current trends and laws.

As an attorney, I have to go to seminars every year. Some are boring, but I always learn something that either makes me more income or prevents a lawsuit.

Have a plan

Don't just wander around looking for deals. Have a plan. Make X number of phone calls a week. Spend $X per month on advertising. Make X number of offers per week. Pass out X number of business cards each day.

Eventually, you start to get lucky. I mean that facetiously because luck always happens to those who are at the right place at the right time. If you plan and persist--you get lucky.

Treat this as a business

People are lured to investing in real estate because of the quick buck they are promised. Don't hold your breath; you won't get rich quick. An "overnight sensation" usually takes about five years.

I would guess that 90% of the people who take a seminar quit after three months. This is a business like any other. It takes months, even years to cultivate customers and have a life of its own.

You need to treat it like any other business. Give it time, effort, attention, and professionalism, and it will flourish before you know it.

About the Author:

william bronchickWilliam Bronchick, J.D. is an author and attorney who regularly presents workshops and do-it-yourself seminars at real estate and landlord associations around the country. He is the president and co-founder of the Colorado Association of Real Estate Investors.

Bill specializes in all forms of asset protection and is the author of several great home study courses:

 
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