realty 411 part 2 - america's favorite investment magazine - featuring whiterock capital

Realt y411 www.realty411guide.com | Vol. 4 • No. 3 A Resource Guide for Investors

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WhiteRock Capital, IncDiscover why this growing Californiainvestment firm also buys in Arizona

Photo: John DeCindis

“Show me the money!” You say, Ok, I will.

It’s actually in plain sight and yours for the taking, if it weren’t for that one thing that stands between you and it. That thing is fear. Fear is what stands between the money you’re mak-

ing right now and the money you want to make. Just on the other side of that fear exists an abun-dance of wealth, freedom and happiness. Big money! If you could only figure out how to conquer that fear, that big money would be yours. Such a simple con-cept, but it almost seems insurmountable, doesn’t it?

What? You’re not afraid of anything? Fear isn’t your problem?

Well... if the lack of time, money, credit and/or knowledge has stifled your real es-tate investing progress, fear is your prob-lem. The reason most would not admit that fear is their problem is because fear comes in so many different shapes, sizes, names and intensities that they don’t recognize it for what it really is. It’s not always called fear, sometimes it sounds like:

•I’ll call that FSBO tomorrow.•There aren’t any deals out there right now.•I can’t qualify for a loan.•The REO agent won’t call me back.•The market is saturated with other inves-tors.•I’ll wait until the election is over.•The market hasn’t hit bottom yet.

Fear, or any variation of the word, isn’t mentioned in any of the above examples, but they are all founded on fear. Until you recognize fear for what it really is and

learn how to conquer it, the big money you seek will forever exceed your grasp.

Through my own personal experiences and now through several years of coach-ing others in their real estate investing, I’ve

come to know fear for what it is 99.9% of the time: False Evidence Appear-

ing Real (F.E.A.R.). Although I can’t think of any fear at the

moment that I’ve experi-enced as being real, I’m sure there’s an excep-tion, so I left the .1%

open to satisfy that ex-ception.

Fear, literally, is a distressing emotion aroused by impending

danger, evil, or pain. Fear is a basic sur-vival mechanism related to the behaviors of fight, flee, escape, or avoidance. The capacity to fear is a part of human na-ture. This emotion is both learned and in-herited; it is a lesson that has been passed on from generation to generation beginning millions of years ago when humans initial-ly learned to fear the likes of saber-toothed tigers and hungry wolves (now that’s what I call impending danger, evil, or pain!). The last I checked, threat from these beasts did not interfere with my last attempt at closing a deal. How about yours? Probably not, but everyday fears that seem just as daunting do.

What is important to understand is that the vast majority of fears we face cannot be categorized as impending danger, evil, or pain. There are few things out there that will kill us or cause us physical harm. As long as we look both ways when crossing the street and steer away from dark alleys at night, most danger, evil, and pain can be

virtually eliminated from a person’s life. Then why does fear still stop us? The an-swer is simple. Whether a threat is real or imagined, the mind will not automatically make the distinction. The mind will initial-ly categorize everything as a saber-toothed tiger, and unless you ignore that initial as-sessment and consciously re-categorize your fears for what they really are... False Evidence Appearing Real, you will forever fall short of your personal potential. Simply put, the fear we experience today is strictly psychological. It’s imagined. It “appears” real and dangerous, but it’s not.

Whether it’s the lack of time, money, credit and/or knowledge that’s hinder-ing your real estate investing, you’ll want to know that it’s not those things that are stopping you. It’s the fear, or the unknown, around those circumstances that stop you;

And this is our clue as to how to conquer fear. The “fear con-queror” is action. Not only will action produce your results, it will conquer and cure your fears. Conversely, inaction, indecision, and procrastination fertilize fear causing it to grow.

Simply put, take action in the face of your fears and your fears will disappear.

But! Easier said than done, right? Indeed. But, there’s an ex-ercise you can use to make tak-ing action in the face of fear easy.

Yep, easy. Imagine what your income, or your life for that matter, would look like if taking action in the face of fear were easy. The sky is the limit!

In the interest of helping you reach the sky, I’m about to introduce to you the “easy” way to conquer fear so you can take actions that will produce the results you desire. I call this easy exercise the False Evidence Test. When executed with integrity, the test flushes out the false evi-

There’s Big Money in Conquering Your Fear: And Here’s How to Do It!

Continued on pg. 61

by Matt Theriault

Realty411Guide.com PAGE 32 • 2012 reWEALTHmag.com Realty411Guide.com PAGE 33 • 2012 reWEALTHmag.com

Matt Theriault

The California market is as hot as its deserts and as high as its mountains. The foreclosures are getting scooped up by savvy all-

cash investors who then rehab them and sell them for a quick profit. The dis-tressed market is creating phenomenal opportunities for investors. But now that inventory is shrinking will we see the market rise even more? Is their Shadow Inventory still yet to be released? To get a view on the state of real estate in California we talked with seasoned veterans Ruth Ortiz and Christian Yepez. They are the principals in the firm USA Real Estate Group, LLC, and they specialize in the rehabilitation of properties in southern California. They are known as the “Property Flip Pros” for their unique ability to find deals and turn a profit for their investor partners in seemingly non-existent situations.

Currently, Chris and Ruth flip about four to five properties per month throughout Southern California. A re-cent deal they rehabbed was a property on La Verne Avenue in East Los Ange-les. They purchased the two bedroom, one bath house for $136,000. It was a pocket listing brought to them by an-other broker. The total rehab costs were $25,000. The property was put back on the market at $249,500.

Within three days it received ten offers and went for the asking price

of $255,000. Ortiz says the outcome was fantastic because they invested in a quality rehab, which included a full kitchen and bath remodel, new floors, interior and exterior paint, landscape, plus new appliances and high-end fixtures.

This sample deal is just one of the success stories that Christian and Ruth can share from their nearly 20 year real estate business. Ruth got her real estate license right out of high school. At the beginning of her career, she said she was doing property rehabs without really knowing what they were. Early on, while taking classes in real estate, she met Christian. They decided to go into business together and their business relationship progressed into marriage. Eighteen years later, both partnerships (marriage and business) are booming.

Coming Back to California

Chris and Ruth may be slam-dunking deals now but two years before the crash, they voluntarily left the Cali-fornia market to seek greater return elsewhere. “We felt that properties were over-inflated. We sensed that something was going to happen,” Ruth recalls.

They recognized that the high prices that forced them out of the market were artificially created. “Prices were ridiculously high. As an investor, you wondered how long this was going to last and how were you going to make money. We got nervous and that’s why we decided to get out of state.”Christian and Ruth ended up going out of state and working the Texas market (San Antonio) for awhile. “Whatever it took to get the job done, we did it because we just didn’t feel there was enough room to make money in Cali-fornia.”

Whereas others took a bath trying to force deals in a constricted market,

Ruth and Chris used their accumulated knowledge and gut instincts to know when to get out.

“I had already experienced the crash of the ‘’90s when I was fairly new in the business.”

When asked how this crash com-pared to the others, Ruth replies: “The current crash was totally different. This crash was more like a tsunami, a totally different animal.”

Ruth and Christian believe that, a key to understanding where we are today in the California real estate market is knowing what precipitated the recent market crash. “I think the artificially high prices were caused by government and political manipulation,” Ruth ad-mits. “It’s an attempt to escalate prices so people will go out and refinance and build up lines of credit.”

Christian says he remembers a time when “If you were breathing and not in prison, the banks would make you a loan and hand you the keys to a home.”

Ruth and Chris believe the real estate industry nationwide continues to be ma-nipulated by the powers that created all this. “The crash is being handled not as a quick elevator ride to the bottom, but more as an elevator ride with intermit-tent stops on various floors on the way to the bottom.”

These expert investors say the market is still shaky and they caution novice rehabbers to be careful when buying for profit. “We still have a way to go. We’re almost at the bottom, but we are not there quite yet.”

In the meantime, Christian and Ruth will continue to take advantage of the distressed California market by doing as many deals as they can before the market changes yet again.For more information on rehabbing with Christian Yepez and Ruth Ortiz, contact: 562-304-7787 or visit onlinewww.CaliforniaHomesRepos.com

The Scoop on the California Market withthe So Cal “Property Flip Pros” by Isaac Newark III

Realty411Guide.com PAGE 34 • 2012 reWEALTHmag.com

The ‘Property Flip Pros’

www.southwestcashflow.com

SouthWest Cashflow is commi ed to delivering investors a turn-key solu on in real estate.

We help create passive cash flow, thus securing your financial freedom.

Phone:(800) 696-1423

www.southwestcashflow.com

SouthWest Cashflow is commi ed to delivering investors a turn-key solu on in real estate.


Phone:(800) 696-1423

South West Cashflow is committed to delivering investors a turn-key solution in real estate.


SouthWest Cashflow is a company of experienced property professionalsspecializing in acquiring, repairing, and managing high-quality, cash-flowingproperties in several markets across the country.

Recent Property Additions

Profitability. Security. Stability.Having purchased and sold over 1,500 homes nationwide, we know what it takes to acquire cash-flowing, turn-key properties.

Your hard-earned money is invested into a tangible asset that our newly emerging “renter” society needs - housing.

Own property in stable neighborhoods through a company with a history of solid acquisition, rehab, and management.

$72,000 $1,700,000$87,900

$74,900

We have options that work for everyone from the passive investor to the person looking to aggressively build their portfolio.

Carolina Liquidator and its a�liates are pri-marily a real estate investment company that works with buying, selling and holding real es-tate. With over 34 years combined experience in the Real Estate and the Mortgage industry we are able to help you achieve your real estate goals in ways that otherwise may not have been possible. We specialize in the metropolitan areas of Charlotte, NC; and Rock Hill, SC.

Our Rental Homes are Turnkey Ready by Strict Standards:

1. New heating and air system with 10 year warranty2. New Water Heater with 5-year warranty3. New appliances, stove, fridge, dishwasher, microwave with 5 year warranties4. Tile �rst �oor of home, including living area, kitchen, baths and laundry rooms.5. Paint interior of home,exterior, if needed6. Replace plumbing and electrical as needed7. New carpeting in the bedrooms8. Tile or granite counter tops9. MISC, door stoppers, smoke detec- tors, light switches and covers etc.10 New lighting and/or ceiling fans

** Complete turnkey properties set for retail standards **

www.carolinaliquidator.com

LISTING CAROLINA LIQUIDATOR has an investment opportunity that works for everyone.

Finish it with this line:

Please add their contact info too:

Carolina Liquidator, LLC.454 South Anderson RoadBTC 507,Rock Hill, SC 29730Toll Free 1.800.754.2911

We strive to build real estate portfolios one house at a time for our clients!

Carolina Liquidator, LLC.454 South Anderson RoadBTC 507, Rock Hill, SC 29730Toll Free 1.800.754.2911

by Bonnie Lalso

With the low cost of living, expanding finance and technology infrastructure

and good climate, the Charlotte, North Carolina market is projected to have increased investment op-portunities.

Forbes magazine rated it as one of the top cities to stretch a paycheck, which means even more families will move into the area, increasing the amount of people looking to rent and purchase properties.

Due to the city’s existing growth trend, Charlotte was able to handle the downturn in the economy better than most other cities. It was is also rated as one of the fastest-growing cities in America, according to the Charlotte Observer, Forbes, and 24/7 Wall Street.

Carolina Liquidators, a bou-tique real estate firm in Charlotte, is helping investors capitalize on the burgeoning local market. The owners, Alex Franks and Kevin Burrell,, have over 35 years combined experience in real estate and have been helping investors connect with the opportunities available in their area.

“Charlotte is in the spotlight now, it used to be the investors’ hidden gem. But that’s no longer the case,” Burrell says, adding: “The secret is out, and the savvy investors are coming in from around the world.”

Sales have quadrupled in the last few months for Carolina Liq-uidator. Burrell says the numbers speak volumes “If that’s not a sign that Charlotte is the new market that everyone is heading to, I don’t

know what is.”They both have worked with a wide

range of levels of experience: From the novice buying their first invest-ment, to the seasoned investor buying their 100th property. They strive to make things as easy and informative as possible. Burrell and Franks say their goal is to educate buyers on their market and allow them to invest at their pace, knowing that once they see their returns, they will continue to buy ad-ditional rentals.

“Charlotte has already made the shift back into a retail market,” Burrell ex-plains. “Builders are back in full blast, it’s a great market right now. Values are not going down, and I can assure you in a few months the same homes you’re

purchasing now will be selling for $5,000 to $10,000 more.”

Investors should take note that Charlotte is cur-rently number two in the nation for appreciation and 9th for growth.

Charlotte is in the 5th consecutive month for home appreciation. On average, for the last five

months the city has gone up 1% per month.

“ New developments are going up literally everywhere,” according to Bur-rell. As the city’s economy expands so are the city’s greenway projects, which

helps residents and families experience well-rounded living spaces. Currently, the city of Charlotte has an extensive trail system called the Carolina Thread Trail. It’s a regional trail network that connects 15 counties and more than 2.3 million people. The volunteer and community partnerships have helped create over 93 miles of trail threading open space, trail ways, riverbeds, and urban areas throughout the Carolina region.

With many number Fortune 500 companies making their business base in Charlotte and the amount of new construction taking place, Charlotte will continue to attract residents from around the nation seeking a better life, as well as investors from around the nation in search of secure returns on their investments.

For more information about the Char-lotte area market, please call Carolina Liquidators at: 803-325-195 or email: [email protected]

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Charlotte, North Carolina: Cash Flow with Southern Hospitality

MARKET HIGHLIGHTS:* 9th in the nation for growth* 2nd in the nation for appreciation* 6th for the most affordable cities* Ranks among Top 10 best places to live* Charlotte Airport under going a one billion dollar expansion* 17th Largest City in the US.* Home of the Panthers, Charlotte Bobcats and the Nascar Hall of Fame* 2nd largest banking center in the US behind NY, and home to Bank of America* City has 11 Fortune 500 companies* Ranked #1 Least Expensive City for Business Travel.* Ranked #1 for “Happy Young Professionals”* Strong rental market, 40% of the population rents* Increasing Rental Demand with job and population growth

www.CarolinaLiquidator.com“ ”803-325-1925

Market Spotlight: South East Region


Alex Franks and Kevin Burrell














Wow, you have the keys! NOW WHAT?

You are at YOUR self storage facil-ity. Even though occupancy is lower than you want it to be, suddenly you feel your excitement level building. Why? This is your dream; you are an entrepreneur now. You see the future, your dream, and are ready to make it happen.

What does the average renter think about when they think self storage? Downsizing? De-clutter? Too much stuff, but want to keep it?

Think about how often you see self storage facilities. It must be a busy busi-ness with people storing their treasures, because self storage is everywhere.

It would be nice if those of us in self storage had a magical self storage wand to wave and “Voila, we have 100% occu-pancy!”.

Unfortunately the average is 76% oc-cupancy. Why? Because we do not use everything available to us. So, how do I promote my facility? What will make my place stand out and above the rest?

Owning or managing a self storage facility will allow you to get to know the customer service industry up and close and personal. BUT, it goes beyond that!!!

How do you spread the word about your facility? Do you do any of these?

•What is your web presence? Do you have a website? Is it accurate? Does it do what you want? Have you tried local advertis-

ing? Flyers, newspapers and signs.

•Community sponsorship; i.e., churches, community sports, parades...

•Media: do you have a Facebook or Twit-ter account? Air spot on the radio, TV news commercial?

•Your current clients: Did you let them know that there was a change in manage-ment, have you asked them to tell friends? Have you let them know you appreciate them?

•Are you promoting it: car wash, free dump day, customer appreciation day?Typically when visiting a self storage unit facility, you will be greeted by the self storage manager or owner.

First impressions are always the BEST! Customer service: That’s a huge key to success in this industry. We go through a checklist in our training, it goes something like this:

•Find out the needs: large vs. small, long term vs. short term

•Why do they need self storage? Then appeal to them on that level: moving, busi-ness, divorce, downsizing, college student.

•Have you told them about the discounts, perks and added advantages you offer? 24 hour security, easy rental payment, temperature controlled units.

Market Your Self Storage Facility at

Maximum Velocity!

•Don’t forget to tell them about how they can save money: referrals, upgrading, first month free, savings for auto pay.•Let them know about extended services: need a truck? How about a business center? Boxes? No problem we offer those here. Let them know everything that they can do in your one stop location.

•Have them fill out a visitor’s card and the show them around, let them know the units available in the size they want. **Extra tip: follow up with them if they leave and reach out asking if they found what they needed. If not you are still there to help.

You can bet that “in the day of the life” of a self storage owner or manager, it will rarely be a dull one. It takes patience and the outstanding ability to communicate well with both agencies, your staff and your tenants.

Your potential hinges on happy tenants. With the right tools and the right educa-tion or coaching, your experience as a Self Storage Owner or Manager can be the start of a rewarding career in the self storage industry.

Kevin Rollings, CSSM© is the owner and CEO of Alcatraz Storage, Hoosiers Self Storage, and Self Storage Facility Management. Whatever the situation is Kevin and his team have the answers! Visit online at: www.selfstoragefacility-management.com and get your 30 minute evaluation FREE!

by Kevin Rollings, CSSM©

Market Your Self Storage Facility at

Maximum Velocity!

by Randy HughesMr. Land Trust

What is a land trust? Why do I need to use land trusts? Both are

very important questions. But let’s be straight forward with this article. You have worked very hard to accumulate prop-erty for investment. You put yourself, you family, and your children’s future at risk invest-ing in real estate.

Do you realize that one false move with just one of your properties can cause you to lose all of your hard earned invest-ments? One careless tenant can be injured on your property and the world will fall all around you. Ask yourself the follow-ing question “Can you control what is happening in all of your properties right now – this minute?” Is it possible that a careless tenant can be injured or die tonight in your rental property? This happens every day in America.

You need a land trust for each property. You need to “insulate” each property from

the others. You need the knowledge that your attorney doesn’t have on this asset pre-serving technique. Why work

so hard to have one uncontrollable tenant event cause you to lose all of your proper-ties? Come on! You are working very hard to build your asset

portfolio. Why lose it now?

Land Trusts are the first line of defense to insulate you from the millions of lawsuits happening in America every year. The most dangerous terrorist of the 21st century that you need to fear is the contingency fee lawyer! Do you want protection from the contingency fee lawyer or would you rather have a bare knuckle fight with him without any defense guards in place?

You have probably noticed that it is VERY difficult to find any information about Land Trusts and how they operate. That is why people from all over the United States come to my website to find accurate information about Land Trusts. Most at-torneys do not know how to set up and administer a Land Trust (they receive only three hours…if any, of trust educa-tion in law school). Many attorneys have purchased my home study course or attended my seminars to educate them-selves on land trust law.

Do YOU Need a LAND TRUST?

EarnÊconsistent,ÊpassiveÊincomeÊinÊyourÊportfolioÊutilizingÊPRIVATE LOANSÊandÊTAX LIENS.ÊOurÊfreeÊgiftÊtoÊyou:ÊTheÊMMGÊCapitalÊGuideÊtoÊTrustÊDeedÊInvestingÊLogÊontoÊMMGInvestors.comÊforÊmoreÊinformation.

BEÊTHEÊBANK.SAFETY.ÊSECURITY.ÊDOUBLEÊDIGITÊRETURNS.

Continued on pg. 60


by Lamarr Baxter

Recent statics show that up to 10,000 Baby Boomers per day will turn 65 for the next 19 years. Sadly, up to 80% of the

that population either lack a retirement account or have an underfunded retire-ment account to sustain them in their retirement years. Part of this problem is attributed to the economic downturn that occurred in 2008, which is still haunting many of us in the present.

Over the past 50 years the population has been taught to fund an IRA or 401(k) along with other miscellaneous retirement related accounts and all that would be fine at the age of retire-ment. Another segment of the population had depended on the equity in their real estate to serve as their primary, additional and/or supplemental retirement savings vehicle to serve as their income source in retirement. Unfortunately for many, that plan is no longer a viable plan based on past retirement planning practices with declining returns in the stock market and declin-ing real estate values resulting in negative equity for a vast majority of the population whom purchased properties prior to the 2008 economic meltdown. This can all be reversed by

incorporating the use of a self directed IRA into your retirement planning strategy by allowing you to take control of your retire-ment funds, choosing a wider array of alternative investment options outside of the stock market and having the ability to TRULY diversify your investment portfolio.

The ability to TRULY diversify your retirement portfolio is key to growing and securing your retirement nest egg. The historic rule for a sound investment strategy has always been “diversify”. Unfortunately, many of us were not diverse enough in 2008 when the stock market crashed. The reason being is that ALL of your funds were invested in a single investment engine, the stock market. Imagine if you had the opportunity to invest in other asset classes outside the stock market that weren’t affected

by the crash, it could have resulted in losses not as great as those real-ized in having all their money in the stock market. While I believe stocks, bonds, mutual funds, money market accounts should be a part of your retirement portfolio, others alternative asset classes should also be included such as:

• Real Estate• Secured Private Notes

• Private Placements/Private Shares• Precious Metals• Business Investments• Secured Business Loans • Accounts Receivable Factoring• Seed Capital For Starting • Your Own BusinessThe above listed investment options are just some of many

options available to you using a self directed IRA. The list also reflects the type of investments that are in demand for capital that could grow your retirement accounts faster and more securely than some of the traditional investments in which you have invested in the past. With a self-directed IRA,

your only two investment restrictions as it relates to asset classes are life insurance and collectibles. Outside those two investment class restrictions, you have almost unlimited investment options available to you using a self-directed IRA.

It’s almost a certainty taxes will increase in 2013 based on the current economic affairs of our country. There-

fore, anticipate higher income taxes and capital gains taxes on investment in 2013. In order to reduce and/or avoid taxation in these two areas would be to consider establish a self-directed IRA, in particular a self-directed ROTH IRA in 2012.

Making your investments with a self-directed IRA funds versus private capital allows you the ability to defer taxes on your gains or not pay taxes at all on the gains with a self-directed ROTH IRA. The rules are as follows for avoiding taxation on growth within a self-directed ROTH IRA:

The ROTH account must have been established and funded with for at least (5) years; The account holder must be 59 ½ or

Continued on pg. 52


The ability to TRULY diversify your retirement portfolio is key to growing

and securing your retirement nest egg.

BRIAN DAVISDirector of Business Development (San Diego/SOCAL)3111 Camino Del Rio North Ste 400San Diego, CA 92108Phone/Cell (619)-892-2438Fax (888) 706-9556Email: [email protected]

Website: h p://www.accuplan.net/SD/index.htm

We are experts in Self-Directed IRA and 401 setup and account administra on. A SElf-Directed IRA/401K is a re rement account that you directly control. You direct the investments of your choosing.

BRYAN CALDERONDirector of Business Development (Orange County/SOCAL)Irvine Towers18100 Von Karman Ave., Ste. 850 Irvine, CA 92612Bus (949) 705-4554Cell (949) 233-5866EFax (949) 242-2730Email:[email protected]: h p://www.accuplan.net/OC/index.htm

LAMARR BAXTER Director of Business Development (Northern California)9245 Laguna Springs Dr. #200Elk Grove, CA. 95758Phone: (916) 509-7150Direct: (916) 708-0235Fax: (916) 405-4000Email: [email protected]: h p://www.accuplan.net/norcal/index.htm

It’s Your Future.Take Control.

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A few years ago, Michael Newton arrived at our magazine’s invest-ment mixer held in West Los Angles. He was eager to learn

all he could about real estate and was already way ahead of the class due to his emphasis and years of real estate education.

“ My parents have owned rental property since I was a teen-ager,” admits Newton, “but the beginning of my own journey be-gan with my company 401(k) administrator recommending two books, The Millionaire Next Door and Rich Dad Poor Dad.”

Newton says that Rich Dad Poor Dad opened his eyes to another way of thinking that he had no exposure to prior.

After his financial awakening, Newton was eager to take ac-tion. He purchased his first rental, a single family home, in North Las Vegas. Shortly after that he purchased three rental homes in Kansas City, MO. Next, he closed on three more rental homes in Dallas.

“All three Dallas homes are brand new construction rentals with great terms, 5% down and 95% financing,” he explains.

Newton finds great deals because he focuses on research,

which is essential for any good investment. He doesn’t just rely on Google Earth, he physically goes to view each investment before he buys it (key word: before!).

His most recent acquisition even took him outside of our nation’s borders . It is an investment opportunity that excited him so much that he contacted our publica-tion with an urgency to share it with our readers.

Let me set the stage: Imagine having an ocean-front home with a private dock leading you to the pristine and spark-ing Caribbean Ocean. Imagine feeling a cool breeze through your hair and being able to hear the seagulls and wind sing be-cause there is silence in the air. Imagine having a beach just for you and your loved ones to enjoy without having to worry about privacy or security?

While ocean-front property is the U.S. is a luxury that only celebrities and CEOs can afford, tranquil and clean beach living can be a reality for the rest of us in beautiful Belize.

“Belize is gorgeous, fun and friendly to foreigners,” Newton says, adding, “It boasts white sandy beaches, turquoise 80 degree water, rain forests, Mayan ruins, and has the largest living barrier reef in the world!”

Surprisingly, Belize is closer to most of the U.S. than Hawaii, and it is the only English speaking country in Latin America.

Mixing Business with PleasureDr. Michael Newton discovers

a tropical paradise with a fantastic ROI

Continued on pg. 55

19 Cents on the DollarInside a Note Deal with Tony Martinez, President of Asset Ventures, LLC

strategy

by Isaac Newkirk III

“We want to make sure our investors are protected,” says the founder and president who has over 18 years in the industry. He adds: “We have multiple avenues for a successful investment. That’s one of the advantages of investing in notes as opposed to investing in properties. When you invest in properties, you’re limited to the options of the marketplace. With notes, you have exit strategies.”

Martinez entered the industry as a build-er back in 1989. During his early years in the profession (dealing with a lot of REOs and short sales) he became particularly aware of the banking industry’s desire to rid itself of delinquent properties through the short sales arena. As he became more knowledgeable of the process, principally by acquiring short sales notes (non-per-forming or delinquent notes) directly from banks, he also came to realize how he could help people retain their properties, at the same time.

Asset Ventures are negotiating about 400 notes and have an additional 700 notes in the pipeline. Their goal is to acquire about 100 notes a month and Martinez says they’re on pace to meet or exceed that goal for the current year.

Based in Redondo Beach, Calif., Asset Ventures has three primary responsibili-ties: resolution (helping owners stay in their house); acquisitions (helping inves-tors make a positive cash flow return on their investments); and teaching and mentoring in the indus-try.

The notes that Asset

Ventures selects go through rigourous research. “What we do in the research phase is we have contact with the banks and lenders and they’ll give us a pool of notes that’s limited to address, the amount of the loan, the fair market value, and just a limited amount of information,” Martinez explains. “Then we have to do our due diligence, our data mining. Every note is then researched against a one hundred point checklist to see if we want to purchase it and move on to the next level.”

Each pool of notes obtained by Asset Ventures from their network of banks involves anywhere from 50 to 500 notes. The pool would be packaged with very similar types of notes and an initial assess-ment would be done on a small sample (say, 25 to 50 out of 500) to get a feel for that particular pool. Asset Ventures has specialized researchers who perform this task. Tony says that “Researchers don’t do any analyzing, they just gather the infor-mation pursuant to the checklist. Then it goes to the next level where management analyzes the data. They go through about 500 files in a week.”

We asked Martinez to show us the in-side mechanics of one of his recent deals.Our case study involves the Arrezo Deal.

Begun in February of this year, the Ar-rezo Deal was completed in mid-August. Martinez says “Once we completed the

research phase of the deal, we began the acquisition process. We looked

at the numbers on the Arrezo Deal; we bought it for 19 cents on the dollar. It was a non-performing

second mortgage. The biggest positive, when we bought this was – combined with the first [mort-

gage] – we had equity in it. The Arrezo Deal had a second lien with an unpaid balance of $86,000. We paid $9,600 for it. When the owner stops paying on the loan, the bank has delinquent debt. They benefit from selling it off.

As a non-performing or toxic debt, the bank would package it up and sell it to someone like myself for pennies on the dollar because it doesn’t have face value to them anymore.”

Of utmost importance, Martinez believes that it must be understood that “In the acquisition phase, we don’t buy the property, we buy the paper. So we’re the bank now. What we do is, we’re buying the collateral paper, which is a bank note. So, if it was owned by Chase or GMAC or Wells Fargo for example, it’s now owned by us and we’re the bank. We don’t necessarily need to take ownership of the property but we’re still going to make money because they’re obligated to pay us. So we’ll go to the borrower and create options for them to get back on their feet. This is how we help people while creating positive returns for our investors. Where they may have paid $500 a month before, they may now pay us $200 a month. In the Arrezo Deal we actually settled the note for the homeowner at $22,000. So they paid us $22,500 and we wiped away $80,000 worth of debt. The in-vestor just made $13,000 profit, which equates to 235 percent return on their money. Everybody wins.”

And that is the main goal for Asset Ventures — that the investor and also the homeowner are successful.For information, visit Asset Ventures online at: www.assetventuresllc.com

Notes provide multiple benefits for investors, the key is you can buy non-performing notes for pennies on the dollar.

In addition, Tony Martinez, president of Asset Ventures LLC, says notes offer many more options to create a positive return.


Tony Martinez


Straight Talk with theInvestment Property Experts

Daniel ButterfieldSteve Taplin

By Stephanie B. Mojica

In the midst of one of the most economically chal-lenged times in history, the

Phoenix, Arizona real estate market is helping some inves-tors yield significant financial returns.

As people shift from placing stocks, bonds, and certificates of deposits into their 401(K)s or IRAs for retirement, they often need professional expertise. That’s where a company such as AZ Investment Property Experts, or IPX, comes in.

The firm, owned by seasoned real estate investors and busi-ness entrepreneurs Steve Taplin and Daniel Butterfield, has been helping seemingly average people earn an 18 percent or higher return on investment. In a supposedly down economy, such yields are nothing short of remarkable.

Butterfield, who has more than 15 years of real estate invest-ment experience, says education for investors is now even more important than ever. He and Taplin not only hold complimentary monthly events for current and prospective clients, but also they co-host a popular weekly talk radio show, “Real Estate – STRAIGHT TALK.”

The program airs on Money Radio 1510 AM, which is Ari-zona’s premier business and financial talk radio channel. Also, the network’s management has publicly lauded Butterfield and Taplin as leading real estate investment experts.

“We feel an educated investor is a knowledgeable investor, which also sets accurate and obtainable expectations,” Butter-

field says. “We are seeing a record number of investors use their 401(k), IRA and Roth to invest into single family home real estate. Many of these investors have never purchased real estate before, thus they are looking for a full service turn-key provider to assist them.”

But even investing in one or two single-family properties is not a fool-proof proposition, Butterfield warns.

“Most investors are scared of the stock market due to the volatility, but they are also not educated enough to invest in real estate,” Butterfield says. “It is very difficult to find the right type of real estate deals in this current economic situa-tion.”

Some beginning real estate investors hire a property manage-ment company to assist with matters such as collecting rent and arranging for repairs. However, most beginning investors do not

have an “exit strategy” planned, which eventually gets them into financial trouble, according to Butterfield.

“Try to focus your efforts on making the least amount of mistakes,” Butterfield says. “The best way to do this is to work with a turn-key professional that can help you identify, buy, renovate, rent and even sell your first real estate investment.”

At IPX, which has team members in Phoenix as well as the Philippines, experienced investors work closely with all clients. Some clients are not interested in a pro-active role, but Butterfield and Taplin provide plenty of opportunities to turn novice investors into experts in their own right.

Phoenix is certainly not the only hot spot for real estate investments in the United States, but it has many ad-vantages over other geographic locations. Single-family investment real estate in Phoenix generates a minimum of 8 to 12 percent cash-on-cash returns during the rental period and about 20 to 30 percent profit when the investor sells the house, according to Butterfield. Also, Phoenix

has mostly attractive neighborhoods and low rental vacancy rates.“Granted there are cities such as Memphis that could poten-

tially yield similar returns but they also have extremely high vacancy rates and these types of rental neighborhoods do not have a high potential for resale,” Butterfield says. “Investors may certainly find nicer homes in Venice Beach, however the cash-on-cash returns are extremely low or even negative in some cases with financing, thus as an investor you would be relying on pure speculation to make a return on your investment.”

To schedule a complimentary investment consultation with IPX, visit www.ipxcompanies.com or call (602) 254-6244.

When dealing with real estate invest-ments, one must

go through many steps of due diligence. Here are my top 10 keys to a successful real estate investing.

(1) EDUCATION - If you are not experienced in real estate investments the very first thing you should do is to get educated. Take the time to

find out what all of the risks are in the in-vestment type you are interested in. Find others that can help educate you on the investment type, which are not involved in the transaction you are doing specifically, so there is no conflict of interest. Buy books, tapes, and go to multiple seminars in order to continue your education, and don’t buy the $5,000 plus books and tapes sets from the gurus. Buy your educational material from the bookstore and save thou-sands of dollars.

(2) GOAL SETTING – If you do not have a goal lined out for your real estate investments how do you plan on getting there? Most investors buy one property, or invest based on emotion rather than having a set goal in mind.

For example, you could have a goal of obtaining $30,000 per month in passive rental income from your investments through buying single family rental homes and apartment buildings. Your goals should be clearly defined and should include protections and risk mitigation techniques to make sure it is a stable vi-able plan that can be obtained.

(3) BUILDING YOUR RESOURCES– You WILL NOT become a successful real estate investor without resources. In real estate, resources include capital investors, property leads, team members and much more. For this you must go to network-ing events if you do not already have your

resources built. It’s im-perative that you go to networking events and expand your relation-ship base. Real estate is a team sport so if you do not go network you cannot build your team.

(4) BUILDING YOUR TEAM – In order to make your investments work you must build

your team. Some of the team members you need are real estate agents, brokers and bankers, private lenders, appraisers, CPAs, attorneys, affiliates, inspectors, property managers and contractors. There are much more but it’s pretty impossible to name them all. It takes quite a bit of time to develop your team and to make sure they can be relied upon.

I have found that building a team is the most important aspect of investing other than your due diligence on the investment itself.

(5) DUE DILIGENCE – Before invest-ing in any real estate asset your due diligence is crucial. You need to analyze the market you’re investing in, the market timing relative to that market, the specific neighborhood, the market value of the investment, the cash flow it produces, the rental income it should bring in, all of the expenses related to the investment and much more. Inspections should be done as well as a review of all of the backup documentation such as leases and con-tracts. Think like an auditor, review all of the backup information provided by the seller and verify it with an outside source as much as possible. I hear horror stories all the time about how people lost money in real estate. After inquiring as to what happened I can say that 99% of the time the investor did not do or know how to do the right due diligence on the investment in the first place.

(6) PROPERTY MANAGEMENT – Property management can make or break your investment. If you do not have a competent property manager that actu-ally cares about your investment and your success you will have a losing investment. We went through about five different prop-erty management companies before finally starting our own company and bringing the management in-house. Most managers are bad at some of the basic management functions such as accounting, rent collec-tion, tenanting, leasing and background

checks, repair calls and taking care of the tenant. By far the most important and big-gest problem is communication with the owner of the property.

Communication is crucial because with-out communication the investor cannot make decisions regarding the investment and lack control. Property management also needs to be structured based on performance, meaning they get paid if it’s occupied only, not when it’s vacant. Incentives need to be in place to optimize performance.

(7) MARKETING – If you do not know how to market for property, capital, prop-erty sales and resources, you will not be successful in real estate. Marketing and sales is one of the most important parts of any business. During economic problems and recessions most companies cut back on marketing, that’s when it’s most impor-tant to increase your marketing efforts. If there are fewer investors, buyers, and re-sources available because of the economy, there is more competition going after your resources. So in order to attract those re-sources before your competition, you have to market more. Marketing and sales is a business all in itself so getting educated on marketing strategies is imperative to your success. When most people think marketing they think of posting classified ads, send-ing out mailers, coupons, bill boards >

Continued on pg. 55Realty411Guide.com PAGE 46 • 2012 reWEALTHmag.com

Mathew Owens, CPA teaches us the tricks of the trade. Learn tips that helped thisCalifornia investor escape from Corporate America by investing in real estate.

10 Keys for Successful Investments

Mathew Owens, CPA teaches us the tricks of the trade. Learn tips that helped thisCalifornia investor escape from Corporate America by investing in real estate.

10 Keys for Successful Investments

Q: When did you decide to organize Com-munity Buying Group? A: I had the idea about four years ago, but it really didn’t come to fruition until 2010. I am a real estate investor and a landlord and started CBG because I believe we can help a huge number of investors and group organizers do business better, and build a better bottom line by having access to the tools and buying power that the strength of our numbers deserves. Q: Why did you see a need in the market-place for this?A: To help the small to medium real estate investor, property manager or landlord, (small business owner) have access to pro-grams to save them money on material they were buying everyday and gain exposure to new ideas and products and to help them do business more efficiently and to network and share information with other real estate investor and landlords.

Our second objective is to help real estate investor groups and landlord associations grow their membership by providing more

value to their mem-bers. Group organiz-ers are often spread so thin running their own business in ad-dition to running an investment group or meetings that it becomes difficult to grow their groups. Our approach is that if we help everyone

succeed, our success will follow and it has proven to be true.

Q: Are you an investor as well, tell us about your experience in this field?A: I have been a real estate investor for over 10 years, flipping properties in addi-

tional to managing and owning 40 residen-tial rental properties. I really enjoy help-ing other people getting into the business and passing on my experience to save them time and money.

Q: Are you a long-standing member of any real estate groups?A: I have been a member of NARPM and National REIA for years as well as serv-ing on the board of Kansas City Investment Group (KCIG), a member of Mid-America Association of Real Estate Investors and currently on the Eastern Jackson County Landlord Association Board. Q: What are the benefits investors re-ceives for being a member of Community Buying Group?A: The obvious answer is saving money on materials they are purchasing for a real estate project. In addition to saving money on materials and gaining exposure to new products, services and ideas, our members also have the opportunity to get connected to an entire community of real estate inves-tors, landlord, property managers and re-habbers/contractors.

We want every member to feel like there is someone on the other end of that phone that cares and that can help them solve a problem, help them do business better or get them introduced to other like-minded

professionals in their community or across the country.Q: How many clubs are a part of Com-munity Buying Group thus far?A: We have clubs or associations in almost every state and have grown to over 10,000 members over the last 18 months. We have had double-digit growth for the last six months straight. By the end of 2012 we expect to have over 15,000 members. Our long-term goal is to continue to add more suppliers and grow the membership to over 50,000 members in the next 24 months.

Q: Tell us how our readers can receive awesome discounts from the CBG Suppli-ers like Lowe’s, Sherwin-Williams, Sears and other CBG Suppliers?A: They can join a real estate investment

group, landlord association or national trade organization that participates in the CBG Program or they can join as an indi-vidual. We always encourage people to join a local participating group as they will get the benefits of the CBG program and the ability to connect with other like-minded professionals for networking and on-going education. Please contact us to find a group in your area or if you are interested in signing your organization up with a group membership. Our customer service repre-sentatives are available to personally an-swer questions or guide members to maxi-mize their membership benefits by calling 816-282-6310 x 202. A good place to start would be to look at our website: www.communitybuyinggroup.com or to contact me at: [email protected].

Q: What is your vision for the real estate investment industry?My vision is to share as much informa-tion as we can with each other and move the industry forward together. It’s a giant market place and there is so much oppor-tunity from wholesale, retail, rehab, educa-tion, technology and legislation. If industry entrepreneurs, leaders, groups and asso-ciations would work together, it would be amazing what we would accomplish.

— article by Lori Peebles

Two years ago, a seasoned investor named Ben Rao envisioned starting a community to help people

share knowledge and get better pric-ing with major retailers. With that mission as a foundation Community Buying Group (CBG) was born. The organization of nearly 10,000 members now offers individuals the ability to buy like larger companies. Through relationships with their Premier Supplier Network, they offer spe-cial incentives and pricing on products that members use every day. In addition to im-proved customer service and pricing from their Supplier Network, members also gain visibility with other investors who may be able to use their products or services. Their

membership is made up of contractors, property owners, investors, landlords and property management companies. We met Rao during our Mid-West Expo in Kansas City, Missouri, and had the opportunity to interview him about CBG.

Community Buying Group Helps Investors Network, Plus Save Time and Money


Ben Rao


Vol4No.3.indd 49 10/17/2012 5:26:41 PM



Vol4No.3.indd 49 10/17/2012 5:26:41 PM

W

Property Partners1.com SaveMyRetirementToday.com

Property Partners IINVESTORS WANT:3 High Returns3 Hassle Free Guaranteed Expenses 3 Predictable & Reliable Income and Investment Outcome

THIS IS OUR MISSIONWe find, rehab, rent, manage and GUARANTEE the proper es for you in our

markets with our in-house staff handling all aspects of the business

Chris Dannenfeldt

If you’re looking for a balanced, appropriate and suitable real estate investment for your porfolio, Chris Dannenfeldt understands how to help you get there.

214-447-7304 (office) 972-693-2140 (cell)214-447-7306 (Asst. Theresa Scalise) 972-692-5448 (fax)

J.C. Dannenfeldt Financial Mgt., LLC/Property Partners 1, LLC: 5015 Addison Circle, #502, Addison, TX 75001

With thousands of transactions under his belt, Chris Dannenfeldt has undertaken many challenging deals, but this by far was one of the most extensive rehab projects of his career. Dannenfeldt represented the buyer in acquir-ing this decrepit multifamily building for the outlandish price of $2,500! Next, he supervised his rehab team to complete a miraculous transformation. Dannenfeldt turned this neglected eyesore into a trophy property worthy of any investor’s portfolio. Dannenfeldt recently discussed the details of this incredible transaction.

1. Research Phase - How you came across your deal?We purchased over 1,000 properties from the city and we bought this particular multifamily building for only $2,500.We finished the vacant project and then sold it to an investor.2. Acquisition Phase - What were the terms of the deal?We purchased all the properties with all cash.3. Rehab/Maintenance - Was the property rehabbed? The property underwent a complete rehab, which included all new plumbing, electrical, new kitchens, baths, sheetrock, lighting, flooring, and windows. Essentially everything was done to the property to make it livable.4. Management - How long was the property held? Was it managed in-house or was the management hired?We are still managing the building for the new owner.

5. Exit Strategy - Please tell us specifics of the exit strat-egy as well as what you learned from this deal? We managed the building for the owner and then sold all of the eight condo units to the tenants for a $23,000 profit on each unit. This is a standard project for us. We buy and rehab the property and then sell to an investor. We also manage for the landlord/owner and then sell to the tenants for a capital gain for the investor. Then, we service the owner financed loans for the investor and then manage the process for the credit rehab and drive the process to get the

new owners (owner financed buyers) able to get a traditional bank mortgage. Seventy percent of our tenants qualify for and exercise their option to purchase. We have had 100% success in getting these buyers qualified for a refinance loan to retrieve our investors their cash outlay back, plus the profit from this sale. Our goal is to have the investor out within a five year period. 6. What returns did the investor make?The client made a guaranteed 10% cash on cash return monthly. He purchased the property for $560,000 and we sold it for him for $760,000, a profit of $200,000. In addition, he made a guaranteed income of $56,000 per year, net after all expenses, also guaranteed during his term of ownership as the landlord.

— article by Lori Peebles

stra

tegy

Analyze the Deal - A Case Study in Strategy{ Chris Dannenfeldt Discusses One of His Most Extensive Rehabs }


Property Partners1.com SaveMyRetirementToday.com

Property Partners IINVESTORS WANT:3 High Returns3 Hassle Free Guaranteed Expenses 3 Predictable & Reliable Income and Investment Outcome

THIS IS OUR MISSIONWe find, rehab, rent, manage and GUARANTEE the proper es for you in our

markets with our in-house staff handling all aspects of the business

Chris Dannenfeldt

If you’re looking for a balanced, appropriate and suitable real estate investment for your porfolio, Chris Dannenfeldt understands how to help you get there.

214-447-7304 (office) 972-693-2140 (cell)214-447-7306 (Asst. Theresa Scalise) 972-692-5448 (fax)

J.C. Dannenfeldt Financial Mgt., LLC/Property Partners 1, LLC: 5015 Addison Circle, #502, Addison, TX 75001

n e e d e d t o invest. They were busy years and we were hand-somely and surprisingly r e w a r d e d w h e n w e managed to buy a home with no money down in one of the most high-priced areas of the nation. How? We found a seller willing to carry a portion of the note and we used private money to get into the deal.

Since we didn’t need any of our own funds to buy our home, we used our nest egg to purchase a small apartment building in 1994. It was then that everything began to change. Within a few short years, our net worth skyrocketed. Things were appreciat-ing steadily and the equity in the properties was rising much faster than our ability to earn a paycheck by working in our profes-sions.

This is the beauty of real estate. A prop-erty can appreciate either due to market conditions or by adding value through a re-hab. Profits can come quickly, much faster than a person’s ability to “earn” a living.

The average national salary in America is $41,673.83, according to U.S. Social Security administration. Having a job can provide for the basics just fine, but what quality of life can that type of salary pro-vide for an average family of four?

In the real estate world, $40,000 is not an astronomical number. One can do a deal and make that much per transaction either by buying and holding for cash flow, or buying and flipping for profit. I even per-sonally know someone who made $30,000 on one wholesale deal, and she did not even own title to the property!

One of my favorite deals was when my husband and I purchased a small multifam-ily property in Hawthorne, Calif., a blue-collar area of Los Angeles.

The market was really hot in 2004, and it was tough getting the deal because there were five other offers, but I wrote a personal letter to the seller assuring him that I would make the best landlord to take over his building and he sold it to us, even though another offer came in higher. Upon purchas-ing the property, we did slight renovations,

one unit at a time. Noth ing m a j o r , just new c a r p e t , new paint a n d I think we changed

the cabinets in the kitchen of one unit. The most challenging part was managing the property, which I chose to do myself, but we just had the typical leaky faucet issues.

About one year and half into the deal, we decided to cash out. We purchased it for $425,000 and in 18 months sold it for $659,000. A gross profit of $234,000! How many people can make that amount of money punching a clock for 18 months?

And what do they have to go through to “earn” that money? Get up at the crack of dawn, commute hours to work, put up with bad tempers, bad attitudes, constant dead-lines and job stress.

On the other hand, we created wealth by simply buying, managing, upgrading, then selling an asset. Can it get any easier than that?

This is exactly why I get so excited about sharing the benefits of real estate with people because wealth can be created much faster and easier than by “working” at a given profession.

After being in the work force for 20 plus years now, I’ve come to realize that more wealth can be created by focusing time and energy into finding and buying proper-ties than by climbing the corporate ladder. Buying one property a year, or every few years, can really make a difference in your life and in the legacy you leave behind.

The time has never been better to get started or to expand your portfolio. Never have we had a combination of so many dis-tressed properties to choose from coupled with the low interest rates of long-term financing. The moves you make now can determine your family’s future. So don’t make excuses about how busy you are.

Be sure to take time off from “work” to concentrate on building “wealth”.

Email the publisher at: [email protected] or connect with Linda Pliagas at: www.facebook.com/lindapliagas

older to withdraw gains without penalty nor taxes

Many may not feel it’s worth establish-ing a ROTH because of the low contribu-tion limits of $5k/$6K and/or may not meet the requirements to contribute based on too much income. Keep in mind, you are able to convert from your tax deferred IRA, 401K or retirement plans to a ROTH. There are no income restrictions on a conversion, full or partial and you are the amount you are allowed to convert has no limits. So take advantage of these tax advantages before they become subject to change in the future.

The objective of using a self-directed IRA is to take more control over your investment choices and invest in what you know and understand. The use of this investment tool requires the necessary due diligence to be performed on any invest-ment you choose. Arm yourselves with the required information and education for the investment choices you choose to prevent the potential for losses.

Remember, this is your retirement ac-count we’re talking about here, so become diligent and proactive to protect it.

“Our mission was to create an environ-ment in which our members can build ca-maraderie, share tested investment tech-niques, and promote responsible investing through networking, and referral-based partnerships,” Willois says. The price of admission to their live club held on the last Tuesday of every month is $20, however members can receive a $5 discount if they pre-pay online.

The Lady Landlords of San Diego also educate their members via seminars, work-shops and live presentations. If a buy-and-hold strategy is your game or you’re curi-ous about opportunities in other states, then it’s time to step into the pink domain of the Lady Landlords of San Diego.

CLUB DETAILS:

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It’s a Lady’s World, pg. 33

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more but the most important and under utilized marketing strategy is internet marketing. Internet marketing is revolu-tionizing the way most com-panies advertise. If you do not understand it or start to learn about internet marketing, you will not gain the market share you deserve and will not be as successful — 85% of buyers go online first for investment information. It is an online world whether you know about it or not.

(8) TREAT YOUR INVEST-MENTS AS A BUSINESS – Most investors buy one real estate investment and do not fully utilize all of its capabilities from a business perspective. If you own one property or 50 plus properties you should be treating it as a business. Be sure to keep track of ALL of your expenses re-lated to the investment, the due diligence you did, travel costs you incurred, etc., so that you can get a deduction for those items against income from other sources. These types of expenses can happen annu-ally and a percentage of your personal expenses can be used as a tax loophole in order to de-duct more against your active income from your job. Your biggest expense in life is your taxes. It is the government’s job to find more creative ways to tax us. It is our job to find creative ways to legally not pay taxes. If you are not winning against the government, start to educate yourself on key tax saving strategies.

(9) LEGAL PROTECTION AND TAX STRUCTURING – It is crucial to protect your-self from financial predators. There are people out there that will sue anyone they possibly can. It’s really important to

obtain additional umbrella in-surance or put your assets into a proper entity so that you are not liable in frivolous lawsuits. Generally for tax purposes you want to keep passive invest-ments (investments like rental real estate that produce income you do not work for) in an LLC and active investments (investments you actively work for) in an S-Corporation or similar entity. Please consult your individual tax ad-visor to go over your specific situation as it is impossible for this advice to relate to every situation. Also be sure to keep yourself separate financially from the investment or entity you hold the investments in so that you do not pierce the cor-porate veil. If you commingle your funds there is a very real possibility that in court your legal entity protection that you worked so hard to setup is worthless.

(10) INVESTING IN SUS-TAINABLE INVESTMENT TYPES – Invest in asset types and real estate invest-ments that are sustainable in the long run. Look closely at the cash flow included in the investment. If it’s negative, unless you are flipping, do not invest. Flipping can be much more dangerous than invest-ing for cash flow because you typically have a payment on a flip investment that is not covered fully by the rental income. If you get stuck with the property, you find yourself in a negative cash flow situa-tion and you can only sustain it as long as you have money in the bank to make that payment. Many people lose a lot of mon-ey trying to flip property, not knowing fully what they are doing and the risk they are tak-

Belize is an undiscovered paradise and as investors we know how important it is to be the first one to tap into a great deal. New-ton wants to share what he’s discovered. “Just south of San Pedro on Ambergris Caye, there is a scenic and affordable 400 plus lot development project . The development is the largest and first full gated community in all of Belize and easily accessible from the air-port in San Pedro. Each lot is fully developed and ready for construc-tion. Each one comes with its own private dock, water access to the Caribbean Sea and parking spots for golf carts.”

It sounds heavenly but does it make finan-cial sense? Newton, who is an oral and max-illofacial surgeon, thinks so. “There is no debt on the developed land and if the properties are placed in the rental pool, the projected returns are 10% plus.”

Currently each unit starts at $100,000. Why is the price so afford-able? Because investors are getting in at the ground floor level. “I relate Ambergris Caye to what Hawaii was before it got ‘discov-ered’ by the world,” Newton says. “Why not be ahead of the crowd and combine real estate investing with a lifestyle that incorporates spending time in a world-class resort destination?”

Newton believes so much in the project that he is now involved with the Belize Commerce Alliance to promote Discovery Trips to Belize. In the past few years, Newton has created a passive income stream and now he is ready to combine investing with pleasure, which leads to an even more rewarding ROI.

— article by Lori PeeblesFor information about Belize and the opportunities in Ambergris Caye, please contact Dr. Michael Newton via email at:[email protected] or at 805-405-3183.

Belize Facts* Only English-speaking country in Latin America* U.S. Dollars are readily accepted* Closer than Hawaii from most U.S. cities* Fee simple title, real estate ownership is exactly like in the US and based on British common law* Belize has strong privacy bank ing and asset protection laws* Rental income is taxed at 1.75% and there are NO capital gains tax* Small and stable government* Undiscovered paradise with vast growth potential - a perfect combination for appreciation

10 Keys for Successful Investments, pg. 46 Mixing Business with Pleasure, pg. 42

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Continued on pg. 61


One of the most exciting things about being a real estate investor is know-ing what markets will produce the greatest long-

term returns — especially while in the middle of a challenging housing market.

In a down market, savvy real estate investors are eager to find out how they can best leverage their resources. And expert forecasts are some of the best tools they can use to back up their strategies. A good example comes from

real estate consulting firm John Burns Real Estate (JBRE), which has recently predicted that homeownership will fall from 70.0 percent to 62.1 percent by 2015 due to a weak economy, weak consumer confidence, limited mortgage availability, higher rates of foreclosures, and short sales, and other factors.

The JBRE forecast, although based on broad market conditions, points out that we are going to see an increasing number of renters and therefore a greater demand and need for rental housing.

Savvy real estate investors choose investment properties that are located in markets with the greatest long-term growth potential. This allows them to invest wisely today while hedging their bets on the future growth and apprecia-tion of their chosen markets.

Our 2012 Housing Market Forecast lists the Top 100 Metropolitan Mar-kets based on future job growth and projected price appreciation. If you are interested in finding growth markets with strong appreciation potential, then the McAllen-Edinburgh-Mission, Texas metropolitan area may be your first choice. We project its 10-year future job growth to surge by 32.3 percent and

home values to appreciate by 37.9 percent in five years. In addition, property values remain relatively affordable with the me-dian sales price around $100,000.

Aside from this Texas residential investment area, our report reveals other real estate markets with great potential including two from Colorado (Colorado Springs and Denver-Aurora), as well as California (Sacramento-Arden-Arcade-Roseville, and Oxnard-Thousand Oaks-Ventura). Other markets that made the Top 10 include North Port-Bradenton-

Sarasota, FL; Las-Vegas-Paradise, NV; Hartford, CT; Springfield, MA; and Phoenix-Mesa-Glendale, AZ. These areas have a five-year appreciation forecast well above 21 percent.

And what does this mean for real estate investors? There’s a gold mine out there waiting for you to take full advantage of it! A fall in homeownership means a rise in rental units to accommodate the surge in demand from those who have recently lost their homes to foreclosure, those who cannot afford to buy property, and those who are still saving up for a new home. Last October 2011, the National Associa-tion of Realtors (NAR) reported that the number of rental homes had gone up to 38 million units in 2Q11 and the vacancy rate of single-family homes and multifam-ily units was at an all-time low rate of 9.2 percent.

Investors never think twice about snap-ping up bargain properties with positive cash flow. As NAR chief economist, Lawrence Yun, puts it, “The dynamics of falling rental vacancy rates mean in-creased landlord pricing power. Naturally as a result rents have been pushed higher...Rising rents mean a better rate of return for real estate investors.”

Cash flow investment properties are indeed your best hedge against the neg-ative impacts of a down market. Take it from Morgan Stanley’s “Housing 2.0 The New Rental Paradigm” report. The financial services company observes that gross rents are “historically attrac-tive relative to current distressed prices. Adding to this attractiveness is the fact that multifamily data shows rents continuing to rise.” More so, it favors single-family homes as the most ideal form of real estate investment in the

market today owing to their huge rental potential. JBRE’s forecast also reveals that homeownership will not be on an upswing until 2025 at 67.1 percent on the back of foreclosed homes return-ing to ownership, improved economic conditions and normal mortgage credit, and an increase in the propensity of households to own a home. That may signal the time to consider selling your portfolio and taking a profit, or trading up into more real estate using the IRS 1031 tax deferred exchange.

There are plenty of investment op-portunities out there today. Be sure to take action, do your homework and invest wisely. As JBRE puts it, “The American dream of homeownership is still alive and well...”

Marco Santarelli is an investor, author, and the founder of Norada Real Estate Investments – a national real estate investment firm providing investors with turnkey investment property in growth markets nationwide, visit online: NoradaReal-Estate.com for a FREE membership.

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Norada Real Estate Investments helps take the guessworkout of real estate investing. By researching top real estategrowth markets and structuring complete turnkey real estateinvestments, we help you succeed by minimizing risk andmaximizing profitability.

Successful Real Estate Investing Beginswith the Right Investment Property!

RENT

WEALTH CREATION MADE EASY

In today’s DIY and finance crippled real estate world, Jeff Ader and his team at

InvestIndy are a rarity. They know long-distance investors need that extra special service to be successful. Property management and seller financ-ing are the two key elements that set InvestIndy.com apart. Their track record for real estate success speaks volumes: “We’ve been doing this for 36 years even before it was being advertised as the thing to do, and I believe we do it better than anyone else.”

Ader operates InvestIndy differ-ently than most conventional investment brokerages. For one thing, clients of InvestIndy don’t have to worry about whether they can qualify for a bank loan.

“Our company provides the loan for the buyer to acquire the property without them having to qualify with a bank. This lessens the need for the buyer to have spotless credit,” Ader explains.

Investors can expand their portfolio with as little as a cash outlay of $13,000. The buyer takes over an existing turn-key rental with a stable tenant already in place. Ader provides the perfect option for people with spotty credit or those who cannot qualify or any more loans. Time is also of the essence, he can close the deal in a week, whereas a conventional lender can take months.

“I own every house that I sell. I’ve owned some of them for one year and others for ten years; which means the in-vestor receiving them will get substantial equity in that investment,” Ader says.

The biggest advantage of seller financ-ing to the buyer is credit worthiness. Banks don’t want to talk to you if your credit score doesn’t exist at a certain level. But a seller with the available resources, like Ader, is often willing to make a deal. This process has another advantage for the potential buyer in that you can often get a lower monthly down payment. Jeff’s deals are amortized for 30 years. “The reason that works so well for the client is that it creates a very low

payment. Sometimes as low as $200 a month, which allows for a great return on investment.”

Many stock-weary investors are now taking advantage of self-direction by purchasing real estate with their 401(K) or IRA (Individual Retirement Ac-count). Ader says that instead

of getting a paltry one to two percent return from certificates of deposit — or taking huge risks with the volatility of the stock market.

Ader and his team are equally known in real estate circles for their property man-agement. Since they have been in business serving local and out of state investors for more than 35 years, Ader and his wife, Miriam, have learned a thing or two. “Our style of property management is based on being a very good mediator in terms

of communication levels between us and tenants. This sends a message to the tenant that lets them know we’re listening to what they have to say, which makes them want to stay longer.”

Since Ader and his family own a sub-stantial real estate portfolio themselves, they know tenant turnover is one of the biggest expenses in landlording. “It can cost up to $1,500 to get the property rent-ready after a tenant moves out. If the tenant feels they’re being treated fairly, they’re much more likely to stick around.”

But it’s not only the tenant that’s the focus of the Dorfman property manage-ment style, it’s the owner-investor as well. Jeff says, “We foster great communication with the owner of the property, 50 percent of whom are out-of-state. Investors get their reports on time, as we’re their eyes and ears on the ground. We do virtually everything for the owners so that it’s a hassle-free operation for them.”

SAMPLE DEALPrice $45,000Downpayment: $13,500No Closing Costs!Annual Gross Income: $8340$695 x 12Annual PITI: $2,774Annual Taxes: $1,028Annual Insurance: $650Annual Management: $834Vacancy Factor: $667Maintenance Reserve: $584Annual Net Income: $1,803Cash on Cash Return* 13.36%

2029 Goodlet AveIndianapolis, IN

30% Down Owner Financed PurchasePurchase Price: $45,00070% Loan Amount: $31,50030% Down Payment: $13,500

Purchase Price: $45,000 Closing Costs: $030% Down Pymnt: $13,500 Total Investment: $13,500*Loan Amount: $31,500 *Annual Gross Income: $8,340 *8% Interest 30 Year term *current rent 695/mo X 12 10 Year balloon payment Annual Principal & Interest: ($2,774)

Annual Taxes: ($1,028)Annual Insurance Estimate ($650)

3 Bedroom 1 Bathroom Annual Management Fee: ($834)825 Square Feet Vacancy: ($667)

Maintenance: ($584)Annual Net Income: $1,803Cash on Cash Return* 13.36% *All figures are projections only and are not guaranteed.

such a great experience, I now own a $1.2 million ocean-front luxury condo in Cabo San Lu-cas, Mexico, and a three bed-room home with a pool in Palm Desert, plus my Hollywood Hills baby, www.Presidential Residence.com.

These three vacation prop-erties offer great benefi ts:1. Cash Flow 2. Tax Benefi ts3. Networking Opportunities4. I trade my properties with other vacation homeowners at NO COST. I can trade time in one of my properties with someone who owns a property in Hawaii or Europe, etc.5. Build equity via apprecia-tion.6. Meet affl u-ent people.7. Own a busi-ness that re-q u i r e s l i t t l e

time and management.8. Build a business that I can sell in the future.9. Have FUN!

Remember there are three necessities in life.

#1. Food. #2. Water. #3. Shelter (i.e. Real Es-

tate). People will always need a place to live, play and work (a.k.a Real Estate). This is why real estate has always been the Number One Investment. But you do need to know how to buy right and invest wisely.

Hector Padilla is president of HP Capital Investments, Inc.,

a real estate acquisi-tion fi rm, and principal broker of SWI Realty, a boutique realty company. For information, please call (310) 204-8971 or email him at: [email protected]

Lori Fouts - Independent Associate510.520.2753 | [email protected]. prepaidlegal.com/hub/lorifouts

What do you get when you’re a member of Pre-Paid Legal?Confi dence in your daily decisions. Peace of mind with your personal affairs. Security for your family. Protection of your legal rights. Advice from courteous and concerned attorneys. Answers to your questions. Call today for more information on how to access the legal system!

Invest in Indianapolis!More Cash Flow • Less Headaches

Seller-Financing Available!InvestIndy.com827 North Capitol

Indianapolis, IN 46204InvestIndy.com | 317.507.4323

35 Years in Business!Our Services Include:•Tenant Screening•Tenant Placement Rehabs•Regular/Emergency Maintenance•Monthly Statements•Online & Yard Sign / Rental Advertising•Outside Network of Legal, Property •Tax and Debt Collection Services

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Rent your property FASTHIRE Dorfman Property Management

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Q: Tell us a bit about Dorfman Property Management, how did the company come about?Jeff Ader: Dorfman Property Manage-ment was founded 35 years ago by Martin Dorfman and his daughter Miriam Ader to manage family owned properties as well as provide fee based property management ser-vices for Indianap-olis investors.

Q: From an inves-tor and managers point of view, what are some common mistakes that in-vestors make?Ader: Overpaying for a property and not doing research about rental amounts. Other

common mistakes are purchasing in a high crime or undesirable neighborhood and not doing a thorough rehab.

Q: Do you have many clients from out of state and other countries?

A d e r : Ye s , w e service many cli-ents from Cali-fornia as well as Arizona, Florida, Hawaii, Illinois, New York, Ohio, Georgia and many more. In addition, we have clients in Italy, Austra-lia, France and Japan.

Q: Why do you think people should have rental properties in their portfolio?

Ader: First of all, it’s always important to diversify your investment portfolio. Hav-ing different asset classifications, such as real estate, stocks, bonds and precious met-als, helps reduce risk in your overall invest-ment portfolio.

Secondly, people can build wealth and accumulate a high net worth by buying and holding rental properties over a period of time. Here is a simple example of why rental properties can be such a powerful wealth generating investment:

Exhibit A: $20,000 lump sum @ 5% inter-est at the end of ten years equals $32,578

Exhibit B: $20,000 cash outlay on a $100,000 rental property, which leaves $80,000 financed with 5% appreciation per year at the end of ten years equals $82,889

Outstanding property management is essential for success and with over 35 years experience, Dorfman Property Management is the industry leader in Indianapolis. The family-run company has owned investment properties since 1960. Jeff Ader, a Dorfman executive, tells us why the company is so special.

Dorfman Delivers Success

Continued on pg. 16

Family-Owned Business, Over 1,000 Properties Under Management

INSIDE INDY: The metro area of India-napolis. was just ranked #1 nationally in housing affordability by the prestigious Wells Fargo Housing Opportunity Index. Plus, the unemployment rate is lower in Indianapolis than the national average.


Call Us for Our LatestDEALS!!!

Jeff Ader

After Ryan Tebbenkamp completed his degree in real estate appraisal from the University of Kansas, he

began to work in the industry helping set com-parables for his communi ty. I t was during this time he observed the benefits of buying rentals for passive income. Since 2001, Tabbenkamp has been not only pricing properties, but also provid-ing outstanding rock-bottom priced deals to investors in Missouri as well as out of state. We spoke with Tabbenkamp recently to get the scoop on the market in this Mid-Western city.

Q: What type of opportunities are you seeing in Kansas City right now? A: Right now, we are seeing fantastic op-portunities with great cash flows in the

Kansas City and sur-rounding areas. We’re able to pick up homes for incredible prices. Q: What is the best part of being an in-vestor in your area? A: Our market is steady. Real estate here doesn’t fluctuate upward and downward like other areas of the United States. Q: Currently, how is the rental market?A: It is really good right now. The typical vacancy rate is low and stands around 5%.Q: When did you start your real estate investment career and how? A: In 1996, I received my degree in real es-tate and real estate appraisal, I saw the op-portunities in the rental market and started buying properties to hold for cash flow. Q: What makes IBuyKCHomes.com unique in the Kansas City marketplace? We focus on aggressively marketing vacan-cies and proper screening to procure good quality tenants in the rental homes, which results in less turnover.Q: Tell us why investors should take a look at Kansas City real estate? A: The cash flow for properties in good ar-

eas are incredible. We truly have one of the best rental markets in the country in terms of Return on Invest-ment (ROI). It’s an area investors from around the world are buying in. Q: How do you handle

property management? A: My company has had a relationship for a long time with a great property manager. They handle everything for me and our clients. Their service is wonderful and it makes our life as investors stress-free.Q: Is there anything else you’d like to add? Can you leave our readers with some advice that can help them?A: The best thing I can emphasize is for investors to be patient. Sometimes as inves-tors we may hit bumps in the real estate rental market, but we have to remember that in the long run, it will work out. Our rewards in this business are long-term, so let the ten-ants pay off your debt, as the house appre-ciates over time.

Market Spotlight: Kansas City, MOLOCATION:Kansas City, MOCOMPANY:Home SolutionsCONTACT:Ryan Tebbenkampph: 816.682.3998web: IBuyKCHouses.com

Most of Bob Hope’s fortune, estimated at $500 million when he died in 2003, came from real estate holdings and sales rather than acting revenues.

Within 24 hours of listing the units with Coldwell Banker, Drake’s properties had netted him a half a million dollars.

INSIDE INDY: The metro area of India-napolis. was just ranked #1 nationally in housing affordability by the prestigious Wells Fargo Housing Opportunity Index. Plus, the unemployment rate is lower in Indianapolis than the national average. Celebrity Real Estate Moguls, pg. 18

Continued on pg. 60


Realtor Jim Nyquist, who specializes in helping celebrities and non-celebrities make money flipping houses, says the rap-

per’s public statements along with a buy-er-friendly real estate market is increasing interest in this arena of investing.

“It is nice to have a celebrity offer backing to the process of house-flipping,” Nyquist says. “Because while some Americans still think of it as decidedly unglamorous work, the truth is that many

adventurous investors make a ton of money doing this.”

Van Winkle said in a CNBC interview that he started flipping houses in the Palm Beach, Florida in 1997. His success even in a time of serious economic challenge garnered him a reality show called “The Vanilla Ice Project.”

“The short sales, the foreclosures are great, but tax auctions are even better,” Van

Photos, left to right: Celebrity icon Bob Hope courtesy of USPS; actress/singer

Cher and hip hop mogul/actor Drake.

how to set up your own Land Trusts? Yes. Is it expensive? No. Is it easy to learn? Yes. And, to prove it, I will send you my book-let, “50 Reasons To Use A Land Trust” for FREE. Just send me an email at: [email protected]

On October 27th,2012 I will be teaching my nationally acclaimed Land Trusts Made Simple Seminar in Culver City, CA. As a bonus day, Dawn Rickabaugh, The Note Queen, will offer her one day Pumping Paper For Profits seminar October 28th, 2012.

Dawn and I will teach at both seminars and show you how to combine Land Trusts and real estate notes for dy-no-mite Privacy, Asset Protection and Profits!

Don’t miss this one-of-a-kind two day event. You can register for one day or both days at: www.realestateforprofit.comor call 866-696-7347.

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Celebrity Real Estate Moguls, pg. 59 Do YOU Need a Land Trust?, pg. 39

The problem is that most practitioners do not know how to set up and administer Land Trusts so many of them consequently advise people not to use them. You may have been told by someone (an attorney, accountant or friend) that you need a Land Trust, but nobody told you how or where to find information to help you get started. The point here is do not trust someone who does not have direct active knowledge of Land Trusts and their benefits.

I have been using Land Trusts in my full time real estate investment business for over 30 years. I have found that many times advisors tell their clients, “You cannot do that” with a Land Trust. Most of the time they are wrong!

You may have heard about the little known technique of using a Land Trust for privacy and profit in this unique real estate market. But, do you really need to learn

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Post Your Blog, Events & Deals

Winkle says. “I just bought the Sea-son Three house on a tax auction. If no one’s bidding against you and it’s an absolute auction, you can steal the homes for pennies on the dollar.”

Cher, one of the biggest celebrities in the world, sometimes has appeared as the queen of re-inventing herself. With the help of architect Steve DeChristopher Jr., the actress-singer tried her hand at renovating a Palm Springs house that she bought for $650,000. She then sold it for $2.5 million.

Rapper Audrey “Drake” Graham took a risk and spent about $1.9 million of his $11 million fortune on two side-by-side condos in Miami. Within 24 hours of listing the units with Coldwell Banker, Drake’s properties had netted him a $500,000 profit.

While it’s not necessary to already have access to millions of dollars to become successful in the art and science of flipping houses, true hor-ror stories are well-publicized on “Flip This House” and created into fictional plots on prime time cartoons such as “Family Guy.” It is all too easy for an inexperienced investor to get seduced by the potential profit and not realize that the home was never really a good investment to begin with.

“For anyone interested in flipping a house and avoiding the horrors, the important thing is to do some research up front,” Nyquist says and adds: “Paying for a good home inspection is a sound investment, and will help ensure that the property in question really can be flipped for a handsome profit.”

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dence within the fear that stops us. When the false evidence is revealed for what it is... “false,” tak-ing action becomes much easier. I use this exercise regularly in my investing workshops to get people over the fear of submitting purchase offers for real estate, but it will work for any fear. To demonstrate how it works, I’ll lead you through the exact exer-cise I do with my students. Go to www.FalseEvi-denceTest.com for a short video demonstration of this easy exercise. The sooner you do this, the sooner your fears will disappear so you can start making that big money.

And Here’s How to Do It, pg. 33

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PACKAGES OF PROPERTIES ARE AVAILABLE!ing only to lose a significant amount of money. On the other side when you are investing for cash flow only invest in quality assets. Typically if you invest in low end assets in your market you get low end tenants also. Instead, you need to invest in quality long-term assets that are going to produce positive monthly cash flow and make you a great return on investment based on conservative numbers.

I truly believe if you do these things, along with increasing your financial IQ, you will be success-ful if you work hard for it. Most of the wealthy individuals in the world work hard for their money and are constantly evaluating their financial situation and investment goals. Putting a personal budget to-gether and reviewing it monthly, creating additional income sources, implementing tax savings strategies, protecting your money from financial predators, and constantly educating yourself are the keys to becom-ing wealthy.

For more information about Mathew Owens, CPA, please visit his website: www.ocgproperties.com

10 Keys for Successful Investing, pg. 55

Should one buy a property to hold or just flip?

The answer is complicated because it depends on many

factors, including finances, risk tolerance and individual

goals. To help readers understand both strategies, we asked

Terica Kindred to share some insight on the differences

between the two. Kindred’s company, Out Estate Investments (www.OutEstate.com,

ph: 323.829.0778) is a full-service real estate investment firm headquartered in Atlanta and

Los Angeles. Kindred offers everything from no-money down opportunities to more tradi-

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“Fix and Flip” versus “Buy and Hold”by Isaac Newkirk III

Buy and Hold (No Money Down)This is the more traditional real estate investment vehicle where property is acquired and held for a period of time (usually a number of years) and sold after it appreciates in value. This model favors the passive investor, one who is willing to buy and do very little other than allowing the property to appreci-ate in value.

Fix and Flip (20K Down)This model requires the investor to acquire the property at below market val-ue, refurbish the property by making strategic repairs, and selling the property

realized in a matter of months.

com/) is a full service real estate investment firm (headquartered in Atlan-ta, GA, and Los Angeles, Calif.) offering everything from no money down opportuni es to more tradi onal investments.

www.OutEstate.com 323.829.0778


Fix and Flip ($20K Down) This model requires the investor to acquire the prop-

erty at a below market value, refurbish the property by making strategic repairs, and then selling it. This

model offers the quicker route to profits. The goal is to make money within a short time.

Buy and Hold (No Money Down)This is the more traditional investment vehicle where property is acquired and held for a period of time (usu-ally a number of years). This model favors the passive investor, one who is willing to buy and do very little other than maintain and allow it to appreciate in value.

“Fix and Flip” versus “Buy and Hold”

by Isaac Newkirk III

Tips from Terica

w w w . o u t e s t a t e . c o m3 2 3 . 8 2 9 . 0 7 7 8

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