Chat 12-19-05
Posted on December 19, 2005
Ralph_Roberts: hi mike, hi kip
Mike_Summey: Hi everyone
MarkCT: Hi Mike
Mike_Summey: I’m not sure how many people we will have tonight. I didn’t get out a reminder email today. We’re having an email problem right now since the switch over to the new T1 line.
Mike_Summey: Hi Mark
Ralph_Roberts: no, we’ll having an AOL problem.. big diff 
Mike_Summey: Mark, I think our first tester is ready to go. More will follow tomorrow.
MarkCT: Excellent. Do they have the program?
Mike_Summey: Mark, I have passwords to get 3 people going. Ralph will give me the rest tomorrow.
MarkCT: Very good. Any decisions on the license issue?
Ralph_Roberts: i’ll be in and out tonight… editing config files on the servers
MarkCT: I’m really looking forward to getting people’s feedback on the program. Its come a long way from where we began.
kip: Mike, when i attended your seminar in Ashevile a few weeks back you mention something about assumable loans can you give me a little insight into the assumable loans.
Mike_Summey: Hi Eddie
kip: hello Eddie
EDDIE-NC: hey every body
Mike_Summey: kip, FHA & VA loans are assumable as well as most private loans.
Mike_Summey: Mark, I’ll get with you tomorrow afternoon on the license issue.
MarkCT: I received an Email from my Dallas property manager and it looks like my last vacancy has been filled.
Mike_Summey: Kip, there is a small fee on FHA and VA assumptions.
kip: Is that based upon you qualifiying and getting the banks to let you assume the loan.
Mike_Summey: Hi Dean
Dean-nc: Hi all
Mike_Summey: kip, no you do not have to qualify to assume the FHA & VA loans.
Mike_Summey: kip, I believe the fee is less than $50 to assume them.
EDDIE-NC: Mike, what are your feelings on double wide mobile homes( with brick underpinnig)
Mike_Summey: Eddie, I don’t like them. They depreciate rather than appreciating.
MarkCT: Filling all my vacancies is a nice way to end the year.
Mike_Summey: Mark, there’s nothing better than 100% occupancy.
EDDIE-NC: I may just try to flip this one I just bought then. 2000 model four bedrooms for 38k
MarkCT: Mike do you own any of your properties in land trusts?
Mike_Summey: met today with an architectural firm about building a possible 6-10 story office tower. I have a meeting with another firm tomorrow and another on Thursday. This will be a $15-$20 million dollar project.
ritchie: wow! sounds exciting
Mike_Summey: Mark, NO! I hold everything in llcs. I do this for estate planning purposes.
ritchie: using your money or other peoples?
ritchie: where is everyone?
Mike_Summey: Hi ritchie, I’ll send you a URL and password to download the beta test version of the program after while.
ritchie: oh ok, great
Mike_Summey: ritchie, small crowd tonight. I did not get out a reminder email.
ritchie: Now I just need some properties to make offers on 
MarkCT: Mike have you ever had an issue of a tenant suing you? If so how did you protect yourself and your assets?
Mike_Summey: ritchie, there are plenty of properties…just not a lot you can purchase wholesale. That takes patience and persistence.
Mike_Summey: Mark, that’s what I carry insurance for.
MarkCT: Sorry I have to cut it short. My 3 year old is screaming about something. Unfortunately just a normal night at my house. Good night all. Have a happy holidays and new years.
ritchie: Mike, the popular media recently has been shifting towards predicting a slowdown in real estate, and suggesting that if you are thinking of selling, now is a good time, and if you are thinking of buying rental property, you might want to wait. I’m wondering if this will accelerate a shift. Would you think it’s prudent to sit still and wait for a year?
Mike_Summey: Mark, tenants can sue, but you have to do something wrong for them to win.
Mike_Summey: ritchie, I never think its prudent to sit and wait. Keep making offers, but expect more and more of them to be accepted as the slowdown…which is inevitable…continues.
kip: Has anyone had any dealings with the Wells Fargo investor rehab program that they offer.
Mike_Summey: kip, I’ve heard of it, but I don’t know anything about it.
Dean-nc: Mike ,I’m about to settle with workers comp and don’t have a lot of cash. I do have some acredge free and clear. What do you think about putting used trailers on this property for cash flow?
Mike_Summey: Dean, I’d much rather see you put in the pads and rent the spaces than get into owning the used trailers.
ritchie: In the interest of stimulating discussion, this is one of the articles I’m referring to: http://finance.yahoo.com/columnist/article/futureinvest/1827
Mike_Summey: ritchie, there are several articles out right now that refer to the impending slowdown in real estate. The good news is that buying the Weekend Millionaire way works best in the slowdown periods.
Dean-nc: Thanks Mike, I’m considering that idea.
ritchie: Mike, the office building: is it your first large scale project? Your money, other people’s, or both?
Mike_Summey: ritchie, it is not my first large project, but it will be the biggest and it will all be my money or borrowed money.
ritchie: is this downtown asheville?
Mike_Summey: It’s not hard to borrow money if you have solid credit tenants ready to go into the building. I won’t start the project until I have 50-70% of the space preleased.
Mike_Summey: ritchie, NO
EDDIE-NC: Mike how ling did it take you to decide to get into commercial real estate
EDDIE-NC: from the beginning
ritchie: As you all can see, I have no trouble keeping that chat moving. Does someone besides Mike have a story they want to share on a recent deal? How did you find it, what terms did you get it for, etc?
EDDIE-NC: Dean, what part of NC are you in
Mike_Summey: Eddie, I didn’t get into commercial real estate for about 15 years.
Dean-nc: I’m just north of Asheville. Weaverville. And you?
ritchie: There is one I want to make an offer on. I’ve been hesitant because the property needs a lot of work. The positive aspect is that it is already rented. I’ve investigated the possibility to get public low interest loans for renting to low income tenants. Rehab money can be obtained for 3%.
Mike_Summey: My first commercial real estate ventures were buildings I leased to my own company.
EDDIE-NC: Thanks, Mike, I’ve just been looking at a few places but I’m very reluctant as I was with my first rental property.
ritchie: The only requirements to qualify for the low interest money, is that the tenant be low income, and the LTV does not exceed 90%.
EDDIE-NC: Dean I’m near Greenville, NC
kip: Mike or any one, I am in Johnson City, TN and I am having a hard time finding someone that deals with investor loans, does any know of someone that lends in the TN market to investors.
Dean-nc: Mike, Why would lease to your own company? tax reasons?
Dean-nc: Eddie, wheres Greenville?
Mike_Summey: Eddie, commercial properties are completely different from residential. there are no landlord/tenant laws to deal with and almost anything goes. You need to be very cautious in the beginning until you get some experience…or have some very knowledgable people advising you.
ritchie: Mike, what do you think is the biggest risk starting out in commercial properties?
Mike_Summey: ritchie, I’ve never understood how you make money renting to people who don’t have money. the subsidies are nothing more than handouts and can be cut off at any time.
Mike_Summey: Dean, I owned the properties personally and my company was a corporation. By leasing back to my company, it allowed it to buy the property for me instead of buying it for someone else.
Ralph_Roberts: hi penny!
ritchie: Mike, the house would be worth 85-95K in good condition. It rents for 795/mo. According to a formula the government uses, the family can earn up to 50K/year and still qualify as low income.
Dean-nc: Hi Penny
Mike_Summey: kip, all banks loan to investors. With that said, you have to sell them on why they should loan to you.
Penny: Hi Ralph, Dean and all.
Mike_Summey: Hi Penny, we’ve missed you tonight.
Penny: Hi Mike, only staying a few mins. Just stopping in for a few. Working on a few things here.
Mike_Summey: ritchie, as I said earlier, government subsidies can change or be cut off at any time. I never would like to have to rely on them to make a deal work.
Mike_Summey: ritchie, I just sent you an email. did it come through?
EDDIE-NC: Dean, Greenville is in eastern NC. About 80 miles east of Raleigh
ritchie: Mike, got it, thanks.
Penny: Hey, its not blocked, my buddy list will not come up
Penny: I can’t even see if you are on-line
ritchie: Mike, have you considered publishing your bubble burst article in popular media? Give you are a real estate millionaire and a well known author I’m sure folks would be interested.
Mike_Summey: ritchie, I’m currently talking with a newspaper about doing a weekly column of articles like that.
Mike_Summey: Before everyone leaves, we will not have another chat until January 9, 2006. I hope everyone has a very Merry Christmas and Happy New Year.
ritchie: You too Mike
Dean-nc: Mike,Thank you for hosting this chat and Merry Christmas to you and yours. Good night everyone.
Mike_Summey: ritchie, the version you will download will only operate for 30 days so you need to get your comments back asap
ritchie: well, looks like everyone is leaving. Mike, yes, I saw that
ritchie: it’s installed already
Mike_Summey: Have fun with it and let me know what you think.
ritchie: so far no glitches
ritchie: ok, I will
Mike_Summey: JS are you still there?
EDDIE-NC: I’m going to do my part in the war on Christmas and wish everyone a Very Merry Christmas too
EDDIE-NC: Mike I hate that I missed the last two chats. I started with Carlton Sheet’s course and I have never written to him to tell him thanks. I had stopped for a while until I heard you on a radio interview and went out and bought your book. So thanks to you also.
Mike_Summey: Eddie, we’ll get things cranked up next year and will start it off with the release of our new book in late January.
EDDIE-NC: lookin forward to it
Mike_Summey: I’ll be with Carleton in January. that’s when we have our winter golf match down at his place in Florida.
ritchie: Mike, what is the new book about?
EDDIE-NC: Sounds like fun
Mike_Summey: It’s “Weekend Millionaire faq” A Q & A book that will be a companion to the real estate book.
ritchie: Cool. I’ll bet you can find lots of faqs from the old chats.
EDDIE-NC: Good, it seems I can never remember the questions that I think of during the week. Maybe I’ll find them in the book
ritchie: In the short time I’ve been attending, I’ve seen several recurring questions.
Mike_Summey: I tis a compilation of the questions we have answered in chats, emails and on the forums only they are grouped to correspond to the chapters in the real estate book and the answers are in much more detail that you get here.
ritchie: nice
Mike_Summey: Well, I’m going to sign off for now and wih everyone a Happy Holiday season. Goodnight and I’ll see you next year.
Mike_Summey: Goodnight
EDDIE-NC: Same to you Mike, Good Night
ritchie: Goodnight, thanks
Ralph_Roberts: good night guys
ritchie: Happy new year all
Ralph_Roberts: ho ho ho
Ralph_Roberts: etc
ritchie: see you in January
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