From the desk of Cody Sperber…
Happy Monday Clever Investors…man I freaking loooooove Mondays. Actually I love any day that I’m alive and doing what I love with those that I love! Know what I mean?
Anywho…today I want to share with you something that Lyle taught me my first year in the business. Actually…it’s a term.
The term is “transactional engineering”.
Ever hear of it?
Basically it’s a way of operation…the way a creative real estate investor looks at a deal.
You see…every lead that you generate has potential for profit. There is a WIN/WIN somewhere in the details of the deal and it’s your job to ask great questions, gather all the facts and information, then use that data to create an “out of the box” custom solution that uncovers hidden profit centers and positively influences the deal towards the finish line.
Unfortunately most investors just don’t have the tools and knowledge necessary to create multiple offers on the fly.
That’s where creative financing comes into play.
Repeat after me…”as creative real estate investors we NEVER have a money problem…we ONLY have a creativity problem”.
When I meet with a seller I’m trying to understand a few things…
- Why are you selling? What are your hot buttons and goals for selling?
- How fast do you want your money?
- Why haven’t you listed with a real estate agent?
- What is your current financing situation? Do you own the property free and clear? Mortgage but no leftover equity? Mortgage with a ton of left over equity?
- What’s the condition of the property?
Once I understand these 5 simple things I pretty much know everything that I need to know in order to create multiple compelling offers to the seller…and in most cases if I do my job building rapport and explaining my offers properly…I end up with the deal!
That’s because Lyle taught me the art of “transactional engineering”.
Think of this:
If the seller owns the property “free and clear”, you can offer CA$H or you can offer TERMS…or a combination of both.
The possibilities are endless.
And when the seller says NO to your all cash offer…tell the seller that you will pay what they want if they are willing to get creative.
You see, the seller can sell you their property but instead of you going to a bank to borrow money (or paying straight cash which in most cases you will want a massive discount from retail)…the seller can become the bank and whatever terms you agree to can become the deal!
$250,000 purchase price, no down payment, 0% interest rate, amortized over 30 years with your first payment deferred to the 3rd month.
No…that won’t work… O.K. what about…
$250,000 purchase price, with $10,000 down deferred 3 months, with a 4% interest rate that tiers over the first 5 years (so 0% year 1, 1% year 2, 2% year 3, and so on until we reach 4%), amortizing the loan over 30 years….will that work?
The point I’m making is there are an infinite number of combinations to offer the seller if they own the property “free and clear”.
What about if they have a mortgage but little to no leftover equity?
That’s where a Subject 2 offer or a Mirror Wrap comes into play.
What about if they have a mortgage but a ton of left over equity?
Sub 2, Wrap Around Mortgage, or a Contract For Deed would work.
Now I don’t have time in this email newsletter to go into all the details of how to property pull these types of transactions off…but I am have an intimate private creative financing mastermind in my office October 22-23rd with some of the BIGGEST educators and mentors in the real estate industry…want to join us?
65% SOLD OUT – GRAB ONE OF THE LAST SPOTS HERE
Guys like Pace Morby, Scott Horne, Bruce Mack, Bill Bronchick, Corey Geary, Bryant Aplass, & Cole Hatter will be there for both days masterminding and teaching you everything you need to know to deploy these tactics.
Once I had the skills and capabilities to maneuver like this I got sooooo many more deals that the average wholesaler. The whole game changed (especially in a hot market like we are in).
If you want to know this stuff…my in-person event is by far the best way I can help you. It’s in my office and food and drinks are included! Hopefully I get to meet you in person in a few weeks.
That’s all for this week…whether you learn creative financing from me or someone else work tirelessly to become a transactional engineer and your income and deal flow will 10X!!!
From The Training Vault:
What’s that sound?
It’s my Deal in a Box!
Everything you need to close a deal from my “Magic Bullet” Postcard to my proven Seller Scripts in one place for FREE!
Normally the Deal in a box sells for $129.99 but you get it for FREE!
Just another tasty treat from your friends at Clever Investor.
What’s up guys! This is Jason on the Marketing team over here at Clever. I wanted to steal a little spot and throw out a book recommendation this week because I’m definitely a reader and felt compelled to share.
This “oldie but goodie” and probably one of the best books on Persuasion ever written is called Influence: The Psychology of Persuasion by Robert Cialdini.
I first read this book probably 15 years ago and it’s one that has made my “short list” of books to read at least once a year. It’s that powerful.
Inside Cialdini goes over 7 key influencers of persuasion based on over 35 years of evidence backed research. Here’s quick list:
1) Reason Why
3) Commitment & Consistency
4) Social Proof
I don’t have time to get into the nitty gritty, but I highly recommend reading it. It’s like taking Persuasion 101 and 102 at a University for just $15 on Amazon.
Once you know, you can’t un-know. It’s like seeing into the Matrix. Don’t say I didn’t warn you