Table of Contents
Table of Figures
ACKNOWLEDGMENTS
Dwans Acknowledgments
First, I want to thank Jesus for all His blessings. Next, my wonderful daughter, Ayla, who was my original inspiration and motivation to become a successful real estate investor. My desire to give her a good life led to my unstoppable attitude. I can proudly say that she has never spent one day in day care, and has traveled more than any teenager I know. We have a special bond, second to none. I also want to thank my fantastic husband, Bill. Along with Bill came two bonus kids, Kris and Billy, whom I love very much. We are a wonderfully blended family of five. God has truly blessed us by bringing us all together.
I also want to thank my fantastic business partner, Sharon Restrepo, for her insights, stories, and support through the years. We have achieved a high level of success by working with each other!
In addition, I want to thank my Mom, Dad & Lois, along with Cindy, Tom, Sarah, and Paul, for all their support. They always encourage me, no matter what I choose to do or how crazy my ideas may seem.
Thank you to the rest of my wonderful family, friends, and employees who helped me accomplish this goal in my life of writing a book. I could not do all the things I do without each and every one of you. I thank my students as well, as without you Id have nothing to write about! I thank each one of you for your public display of support. I sincerely hope you make a million bucks this year!
Sharons Acknowledgments
Where do I begin? First and foremost, I must say thank you to God! I thank my awesome family for all of their support in every one of my questionable endeavors. Thank you, Mom, Beverly, Fred, Jordan, Kirsten, and Sydney.
Second, I must thank Dwan and Juan (talk about a tongue twister!). Dwan, you have done so many crazy deals with me. I remember when we practiced teaching to an empty room just to get prepared for our dreams to come true. Our teaching ultimately led to the introduction into my life of my husband, Juan. Juan, you are an absolute dream come true, and I am extremely blessed to share my life and dreams with you, and most recently our new son, Joshua.
Last, I want to thank all of the Florida Real Estate Investors Association (FLREIA) members, as well as our students across the country, for allowing us to be part of your dreams pursuit. And if youre reading this book, I thank you and look forward to finding out how it changes your life.
May God bless each and every one of you.
INTRODUCTION
It sounds like you are taking ad vantage of people in distressare you?
This is the first question many people ask when they find out what business were in. Investors, were here to tell you that you are not taking advantage of the homeowners. The homeowners find themselves in a desperate situation and see no way out. Something in their lives has changedloss of a job, illness, death in the family, a job transfer, or something else along those lines. If someone does not step up to the plate and do something, the homeowners will lose their home, have a foreclosure on their credit report, and need at least seven years to get back on track. We are offering a solution, right now, that will allow the distressed sellers a fresh start. By letting us handle a short-sale of their property, they will have money to move, no foreclosure on their credit report, and a chance to buy a new home again.
Most homeowners tell us that we are angels sent straight from God. We offer a solution to a problem that most folks never imagined they would encounter. No one grows up intending to be in financial distress someday. We want to be doctors, firefighters, and police officers when we are kids. Then something happenswe grow up and life takes over! We graduate from high school or college, take a job, and assume everything will work out. Unfortunately, it doesnt always work out for everyone.
We use this business as a ministry. We talk to homeowners about a fresh start and offer sincere encouragement. This business has been a blessing for both of us, and we know it will be for you, too.
This is such an amazing way to earn a terrific living!
We love it for two reasons:
1. We get to help homeowners get a fresh start.
2. We get to help you get a fresh start.
We dont know which we like bettergetting a testimonial letter from a student with a copy of a $100,000 check attached or watching the look of joy on a homeowners face when he or she realizes the nightmare is over. We feel so truly blessed to be in the position to do both. Investors, we know you will love this business as much as we do.
Get started now... and start living your dreams!
Why Is America in Foreclosure?
Why did the real estate market change so dramatically in 2007? Is it still a good idea to invest in real estate? When is the market going to turn around? Should I sell the properties I own before the prices drop again? Questions like these may have been on your mind recently. Its important to understand why the real estate market crashed in 2007, so you can ride the wave of opportunity it created. Let us clarify that this is a chance to take advantage of opportunity, not people. This business needs more investors with heart, who are trustworthy and desire to earn a great living creating winning situations for all parties.
The biggest reason for so many foreclosures and bankruptcies has been subprime, interest-only, or exotic loans. These loans are very appealing. Many of them are adjustable-rate mortgages (ARMs) that allow homeowners to purchase a larger house with a smaller initial payment rate. The problem is that when the payment rate changes, many folks cannot afford the larger payment and end up in foreclosure. Also, many people were allowed to take on greater monthly payments than they could handle, especially if they later on ran into financial trouble.
Lets take a look at several of these loans:
Teaser adjustable-rate mortgages. These loans entice borrowers by promising an initial period of very low interest (typically around 1 percent to 2 percent), which later resets to market rates. Over two million borrowers will be jolted back to reality this year when their introductory periods begin to expire. Payments on a typical $200,000 loan at 2 percent are approximately $725 a month; at 7 percent, the payment is $1,340. If the property was purchased based on the affordability of a $725 monthly mortgage payment, what happens when the payment climbs to $1,340?
Subprime adjustable-rate mortgages. Because many of these subprime or nonprime loans require no income verification, they attract low-income people or those with bad or marginal credit. These folks assume that they cant qualify for a more reasonable rate, so they take what they can get. Many are in questionable financial positions to begin with and are therefore in greater danger of defaulting. Subprime ARMs start with a lower interest rate that continues to climb each year. Homeowners can find themselves paying 13 percent interest in just a few short years. If the initial interest rate of 7 percent was the maximum payment they could afford, what do they do now?
Option adjustable-rate mortgages. This type is initially the most appealing loan. It gives homeowners the choice each month of paying the principal and interest, just the interest, or an even smaller minimum amount. If the mortgage payment is $1,000 a month and the homeowners decide to pay $450, the balance of the payment goes on the back of the loan, causing negative amortization. Eighty percent of homeowners with these loans pay the bare minimum. Because the amount paid does not cover the amount due, the balance added to the back of the loan increases the total amount owed. Once the loan balance has increased to a certain point, the bank demands that the homeowners begin to make full payments on the now larger amount.
