• Home
• Chat
• Success Tips
• Chat Transcripts
• Contact Us

• Mailing List

  • Email Address:
    
    subscribe:
    unsubscribe:

• Store

  
  We feature a growing selection of books, CDs, tapes, and other items that enhance real estate investment. Become an Affiliate Shop Now Buy the Offer Generator Offer Generator Tour

• Pages

  • Meet Mike Summey
    • Mike Summey Audio
  • Meet Roger Dawson
  • Weekly Chat
  • TV & Radio Appearances
  • Radio/TV Interview Request Form
  • Press Kit
  • Inspection Form
  • Write a Testimonial
  • Contact Us
  • Sitemap

Chat Transcript – February 2, 2009

Posted on February 3, 2009

Deb Hi
Ken Hello
Ken we’re early
Jonathan Hi Everyone
Deb I was hoping to get a question in early before everyone shows up
Deb I must have a major mental block or I just dont get it
Ken Me either, I can’t see your question
Deb I read, read, read, grasp the consept of negotiating a seller financed property, but I just dont understand where you go from there
Ken You mean setting up the contract?
Ken If so, I never done that Mike will be better to ask. I would contact an attorney or someone from your local REI club
Deb do you have a lawyer or what, where do you go to do the paperwork,
Deb How does the property transfer into my name, who records the deed etc… none of this info is in my books!
Ken I am sure it’s pretty simple. You just set up the contract for you to pay and what happens if you default, then you record your property at the courthouse. but again Mike will be best to ask
Mike_Summey Hi everyone!
Ken Long time no chat
Jonathan Hi Mike!
Deb I know I sound stupid, but I am missing something major here, and it’s preventing me from trying my first offer
Mike_Summey Hey Ken. We decided to host the chats once a month for a while since so many people have gotten turned off to real estate. Besides I’ve been too busy buying properties.
Ken Retype the question I don’t think mike can see it
Mike_Summey Hi ncbob & doug
doug_in_CT Hi Mike, Glad to hear you are “too busy buying properties.”
markl hi everyone
Mike_Summey Deb, it’s called “guts”
ncbob Hi Mike and all
Deb Sorry you missed my question.
Corey Hey Mike.
Mike_Summey Deb, calculate offer that you know will work for you and present them. Don’t worry if they get turned down. You’ll have a lot more rejected than you will buy.
Mike_Summey Hi corey & david
doug_in_CT These are the few, the proud, the die hards, the last of the Mohegans, who still believe real estate is a good vehicle.
Mike_Summey Hi roger
Ken Doug, I havn’t been even looking for RE sense 06 I am hoping to pick something up this year.
davido hey mike – got your note last month about people dropping off. i read the transcripts because this is a tough time for me to make. but people should be investing now more than ever.
Mike_Summey doug, my son and I will be inspecting 10 houses, 5 duplexes and 1 4 plex tomorrow.
Lon Hi Mike
Mike_Summey Hi lon & joshua
Ken Mike I get bored if I look at more than 5 properties.
doug_in_CT I thought we were not going to be seeing Roger….but maybe this is a different Roger.
Mike_Summey Hi Jones
Mike_Summey Hi hawkeye
Deb Im looking for the details, after Ive made an offer ,its been excepted by the seller, seller financed, where do I go with it, a lawyer, bank, courthouse, etc…how do I recieve the deed
hawkeye775 Hi Mike
doug_in_CT That is a big day Roger…..I hope it goes well.
Mike_Summey doug, it’s a different roger.
Jones Hello Mike
hawkeye775 Hi Everyone
roger34 hi i am a first time chatter
Corey Mike with the economy the way it is have you seen a change in where you
Jones Hello hawkeye
Corey getting your deals. sorry
doug_in_CT I mean That is a big day Mike…… I hope it goes well.
Mike_Summey Ken, after looking at several, it does get a bit tiring, but the trip tomorrow as originally scheduled to look at just 2 properties. Now it’s up to 16. It will be a long day, but I’ll bet we buy some of them.
davido Hey all I got a question about mortgage loans. I heard that loans won’t be sold to Fannie and Freddie if you have more than four mortgages out at one time. This includes your personal home. This number used to be 10. anyone else hear this? Makes it tough to get bank financing that way.
Mike_Summey roger, glay you could join us. Just jump in any time.
Ken Mike I just wanted to say that was a good article for Jan 13th
Ken Keep them coming
Mike_Summey Corey, I’m seeing a very different circumstance now. ther are more deals than anyone can buy.
Mike_Summey david, that is true and it’s the way it should be. Investor loans are different and should be treated that way.
Mike_Summey Hi Larry & barb
markl That is good Mike because I live in Asheville and am hoping you do not get all of the good buys
davido I’d like to buy more, but in the position i am in today (two rentals), i have wait until later this year or wait for the banks to lend freely again (not going to happen of course)
Mike_Summey Hi Penny
Penny Hi Mike1
Mike_Summey markl, all of the properties I’ll be looking at tomorrow are in SC. The Asheville area still has a long way to go before it comes back to reality.
Corey Mike I read where some of the apartment owners were buying single family because they could capture so much equity in this market off each home
Mike_Summey Hi uileineeuq
davido Has anyone seen rents come down in this environment?
doug_in_CT Mike as you look at the 16 deals tomorrow…What is your strategy? Are you thinking of using Bank Financing? Or is that a non starter?
Jones Hey Mike, I live up in Seattle, nothing cashflows in my area, (Properties cost more than the rents command) what would you do if you were in my shoes?
Mike_Summey Corey, I just closed on one last week that is a 3BR 2B – 1650 sq. ft. with double car garage. Brand new…never been lived in. I bought it for $80,000 which included $5000 I paid the man who found it for me.
Deb First time putting in an offer. Once my seller financed property offer is excepted, where do I go with the paperwork? Am I suppose to have a lawyer? Where do we sign all the paperwork, and record it?
Jones A trailer might go for 80,000 here but that is about it.
Mike_Summey doug, it will depend on the seller’s circumstances. I know that 10 of them are bank foreclosures for which I will offer cash. Eventually I’ll have to put loans on them to get my cash back out.
Mike_Summey Hi sparky
sparky37 Hi Mike, nice crowd tonight
doug_in_CT What about the other four?
hawkeye775 Mike have you ever had a contract get held up because of a lien on a property. I was supposed to close on a house in December, but one of the heirs owes the IRS. The title company is waiting for the IRS to clear it. The IRS is now saying in the next 2 to 4 weeks. Patiently waiting
Ken Deb, I contacted my attorney and told them I wanted a contract for selling a property, They gave me one that looked like it was writen by a 2year old. We added lines in as needed then intialed and dated those then we went to closing
Corey Mike what range will that house rent for?
Deb Mike, what do you mean by cash, literaly paying them with cash or some kind of paper instrument
Mike_Summey Jones, keep making offers that will cash flow if one is accepted. You might be surprised at what some sellers will do when presented with a written offer and a check. Forget about asking prices or appraisals. They mean nothing to a long term investor.
Mike_Summey hawkeye, can you close and have the closing attorney hold the money for the IRS in escrow until the lein is cleared.
Deb Thats my question Ken, where did you go for closing?
Jones Thanks Mike, I have to get another agent because he is disgruntled because I keep getting a lot of the offers rejected.
Ken My attorney
sparky37 Deb, you can go to the title companies office
Mike_Summey Hi krspack
Jones So who is your suprise guest tonight Mike?
krspack1 Hey Mike. Full house
Ken They reviewed the contract called me if things needed changed, set up a date. I go in and sign then leave and the buyer/seller goes in when ever that day
uileineeuq Hi all. Does a lawyer have to get involved in Seller’s financing? I live in CA and I don’t know any lawyers.
Mike_Summey Deb, when I say cash, I mean cash. Fortunately, I’ve been able to get myself in a position where I have access to cash.
Deb How do you find a title company and how much does this cost
sparky37 do a local search on google or contact any realtor in your area
Mike_Summey Jones, Carleton Sheets said he might join us if he could get to a computer. He is on the road traveling as is Roger.
Ken Deb, My attorney does that. I think it was around $500
Deb Thanks Mike, Smart man, wish I could do the same
Jones oooh I see
hawkeye775 The heir owes more than his share so the IRS won’t clear it until they make sure the house is being sold on the up and up. Hopefully, it will clear soon.
Deb ok great ken, now Im getting somewhere, I need a lawyer, and also need to factor in those exspenses to
Mike_Summey uileineeuq, in CA I think you use title companies to handle closings. They can prepare the documents for seller financing just as they do for bank financing.
Mike_Summey Things are moving pretty quickly, so if I miss your question, jsut ask it again.
Ken Deb, usually closing cost $800 but more if you finance. you might be looking at $1500 if the owner finances? not 100% sure. Make a list to ask the attorney
krspack1 Mike, suppose you are an individual who has a good income, good credit score, but no extra cash to invest. What is the best way to get financing if you have found a deal according to the WM way?
Joshua Jonathan, where are you located? Vegas by chance?
Jonathan Actually I’m in Anderson, SC and this is my first time in the chat room
Mike_Summey Deb, I didn’t always have cash to work with. When I started, I was just like most people and had to be very careful about the offer I made. It took me a whole year of making offers before one was accepted, but I still own that property as I do all of the others I’ve purchased over the past almost 40 years.
Corey Mike on the 80,000 house what rent range would it be in?
Ken Jonathon I just did a job in Seneca, SC. Nice area
doug_in_CT What kind of work are you doing Ken?
Jonathan Ken, what do you do?
Lon Ken sounds like a hit man.
Mike_Summey krspack, in that case, you will probably need to find a seller with a large equity in the property. A technique I have used several times is to get a small 1st ortgage from a bank (20-40% LTV) and then ask the seller to finance the balance. The seller gets the cash from the bank and you make the payments on both loans. Just be sure the NOI will cover both.
Ken Electrical and instrumentation Tech. I was at the power plant for 2 months
doug_in_CT Watch out there are a couple of guys heading down there — to SC — to buy a lot of properties tomorrow.
Mike_Summey Corey, it will rent for $950 – $995. We’re asking $995, but will take as little as $950 if needed to get it rented.
Ken I live in PA, I am in Myrtle beach now for a training class (Lame)
krspack1 Mike, suppose you can get 80% from the bank and nothing from the seller. Do you ever look for other investors to make up the 20%?
Mike_Summey Jonathan, I’ll be coming to Anderson tomorrow to look at properties.
Jonathan Tell me about Ken… I just finished my Broker A&B courses in Columbia, SC
Ken I should have brought my golf clubs instead of my mountain bike.
Jonathan Mike, what areas in Anderson will you be looking in?
Mike_Summey krspack, I have done 80/20 deals, but I’ve found that if I can buy for cash and finance later, I can usually get 70-80% of appraised value. If I pay more than that for a property, I’ve probably paid too much.
Mike_Summey Hi Akunauba
hawkeye775 mike, how did you find someone in SC to help you find houses?
markl mike, would you say i am definitely wasting my time looking for deals in asheville?
Akunauba Hi Mike
Mike_Summey Jonathan, I’m not sure. I have a Realtor picking me up at the airport and I will ride with him for most of the day, then he will drop me off at another Realtor who has some others to show me and will then take me back to the airport.
krspack1 Mike, when you first got started, on average, how much time did you spend weekly on your investing career?
Deb Massachusetts has no deals either
Mike_Summey Makrl, difinately not. Just understand that the deals are not as plentiful in Asheville. As they say, the market is not ripe yet.
Deb At least not for newbies. You need money here
markl thanks mike
Ken You guys and gals see how much the Pheonix and Los Vegas properties have dropped? Pretty crazy. i would sit down and cry if I bought a hosue there in 05
Mike_Summey krspack, I’ve averaged spending about 4-6 hours per week for the past 37 plus years. My sons used to complain about going to look at houses with me on Saturdays. They’d say, “Daddy, do we have to look at houses again.” Now they understand why I was doing it.
Deb But ken, is arizona a good place to buy right now?
krspack1 Mike, that is funny. My girls are starting to say the same thing
doug_in_CT The president of foreclosures.com believes the worst of the housing market crash is behind us. She cites affordability being at the highest rate since 1994, when median home price equaled 18% of median income. She also cites dropping interest rates and plummenting housing construction and a growing population that will mean increased demand. What do you think of this forecast?
Ken Who knows, I just read about how prices have dropped.
markl good going mike, bye the way nice going in the asheville citizen times about teaching children fiscal responsibilty
Mike_Summey Jonathan, I’ll probably be arriving in Anderson about 9:00 am. If you live nearby, feel free to stop by and say hello. Sorry, but I won’t have much time to do more than that.
krspack1 Mike, thanks. That gives me a good idea from a time commitment / requirement standpoint. 4-6 hours per week is definitely doable.
Mike_Summey doug, I think we are still at least a year and possibly more away from a bottom and even once we hit bottom, I don’t anticipate seeing a big rebound for several years. Too many people have been burned to expect things to turn around quickly.
Ken Doug IMO soon as the market stabilizes Interest rate will rise to keep housing prices flat. Government needs your money
Mike_Summey krspack, that’s where the title Weekend Millionaire came from…the fact that I built my portfolio by spending a few hours on the weekend while working a fulltime job.
hawkeye775 Until the job market gets a lot better, i don’t see how the housing market can improve. There are a lot of people without jobs.
krspack1 Mike, when you buy your first home, conservatively, how long should you plan the home to be vacant until the property manager fills the vacancy?
Ken Mike other than the Offer Generator how do you keep track of your contracts or other things? Do you have a software, You mind, or something else? I find myself sending postcards to the same people which might not be a bad thing.
doug_in_CT Now Mike if you think the 16 houses you are going to look at will cost less a year from now…. Why buy them tomorrow? Why not wait until next year when they may be much less expensive?
Mike_Summey krspack, there is not difinitive answer to that question. I bought 2 identical houses at the same closing last summer. One rented within 5 days, the other one took 3 months.
Mike_Summey Hi Kel
Joshua Mike, I know you recommend investing within 10-20 miles of where you live if possible. Does Anderson have such good deals that it’s worth extending? Have you identified your property mgmt company for that area already? You concerned about the distance?
Ken krspack1 in my experience a PM will take longer to fill a place because they screen more.
Lon Doug, someone else will buy them before then.
Mike_Summey Ken, I use the OG to prepar the offers. I save the offers on the computer by date.
Kel Hi Mike and all
Ken Mike thats what I do but I need something to log what I say to a realtor or other contact. Soemtimes I forget what I said.
krspack1 Ken, thanks. That is not a bad thing. I think Mike has recommended 6 mos reserves.
krspack1 Ken, try using ACT
Mike_Summey Joshua, I’ve been investing in Anderson for over 30 years. The property manager I have there has been working for me the entire time. The reason I have the block of properties in Anderson is because I used to have to spend at least one night a week there with my job. I didn’t ahve anything else to do in the evenings, so instead of going to the bars and getting drunk, I went out and looked at real estate.
Deb Is there a tactful way to put an offer or let the next of kin of my elderly nieghbor that was just put in a nursing home, Im interested in buying her house
Mike_Summey Ken, I usually make an offer, give the seller a time to respond and if I haven’t heard anything if forget about it and move on to the next one.
Mike_Summey Deb, she might be a prime candidate to seller finance the property. If she is in a nursing home, she can probably use the money each month to help cover the cost.
Deb Thats what Im thinking, but dont know how to contact anyone who might make that decsion for her
Kel Mike, I was late so sorry if you have already discussed this but have you seen and increase in late payments or no pays on the rent with the economy the way it is?
ncbob Mike, Single or Multi-family to get started…or either
krspack1 Mike, for interviewing property managers, do you recommend any other information besides what is found in your WM book?
hawkeye775 Mike, when using the OG, if it says that you can offer for example $50k for a property using 20% down, and 80% over 20 years @ 7%, would you make your offer specifically for this amount or start lower? In this example, let’s say they are offering the house for $58k.
doug_in_CT Deb, contact a realtor in your area and ask them to make the call to the next of Kin…..They may have some tools to help discover the people you are looking for.
Mike_Summey Kel, so far rents have been holding up pretty well. That is my biggest concern about this recession/depression. The only thing that can put a damper on the market for long term investors is if the economy gets so bad people can’t pay their rent. It could mean a higher turnover rate as slow paying tenants have to be evicted and replaced with better paying ones.
Deb But if I do that, then the realtor will list it and will defeat the whole purpose of making a good deal
Ken Mike have you heard from Al lee lately?
Mike_Summey ncbob, single family is always best for starters. They are the easiest to finance, draw the best tenants and are the easiest to sell if you find that real estate investing is just not for you.
doug_in_CT Deb, you could explain your plan to the realtor and tell them you will pay them for their time….by no commission.
Joshua Mike: What has been your avg rent increase percent recently on contracts coming up for renewal?
Mike_Summey krspack, if you follow the advice in the book, you should be fine.
Mike_Summey hawkeye, it never hurts to start lower than what you can pay…you just might get it…especially in today’s market. You can always come up but it’s very hard to go down.
Mike_Summey Joshua, we’ve probably averaged 3-5% per year for the past 2 years.
Deb I hear yuo guys talking of properties for 50 60 70 80 grand, here its easily 230 and up, where do you go for these prices
Ken Deb, Lots have to do with rents and the local economy.
Mike_Summey Deb, do the blue collar workers in your area live in $230,000 homes?
Deb Yes
Mike_Summey Deb, what do they pay for rent?
doug_in_CT IN CT the blue colar wokers live in $150,000 homes.
Corey Mike I have leave. Gettin ready to go work in New Zealand for a few months. glad to be int he chat tonight
Deb 1000-1500 ish
krspack1 Mike, is the offer generator a downloadable program or are you sent a CD in the mail?
Mike_Summey Corey, good luck. Are you fixing dents in New Zealand?
Ken The northern states have high taxes. atleast in PA and a vacancy in the winter will kill profits.
hawkeye775 mike, do you own any property in the candler area? or west asheville?
doug_in_CT Rents on the $150,000 homes can be $1,500/mo and higher.
Corey Mike unfortunatley yes. but one of the top motorcycle touring destinations also
Deb Doug from Ct you have homes for 150000?
Akunauba Does anybody know of a good REO agent in the Los Angeles area?
Mike_Summey Deb, make your offers based on the rents a property will bring and expect to be rejected more often than not. Remember, you only have to buy 1 property a year over a number of years to become wealthy.
doug_in_CT Yes.
Mike_Summey hawkeye, yes I do. I have several properties in both areas.
hawkeye775 Doug, what part of CT are you from? I’m currently in Poughkeepsie, NY on business.
Mike_Summey Hi sujaykaycee
sujaykaycee hello mike
hawkeye775 just curious, i live in Candler.
doug_in_CT We are North and EAst of Hartford and own properties in and around the Hartford area.
sujaykaycee t finished reading your book and i must say that it is the best book that i have read
Corey Mike have you been there?
Mike_Summey sujay, thank you! Which of the books did you read?
sujaykaycee realised a lot of mistakes that i have made while renting my apartment
Deb Mike own anything in mass
Mike_Summey Corey, no I haven’t. Let me know how it is.
sujaykaycee the secrets to investing in real estate and FAQ
Corey Mike ok buddy take care
krspack1 Mike, is the offer generator a downloadable program or are you sent a CD in the mail?
Mike_Summey Deb, no I only invest in NC & SC
Deb What are your thoughts of investing in Arizona?
Mike_Summey krspack, the program is on a CD that is mailed to you. If you want to know more about, others in the chat can tell you what it can od.
Ken Visit in the winter?
sujaykaycee i have just started to invest ….i am not sure how to proceed from here to get a loan for my second investment. I live in arkasas and i wanted to know what ur thoughts are on this?
Deb LOL
hawkeye775 krspack, i used the program to generate the offer on the house i’m waiting to close on.
Mike_Summey Deb, there are good investments in all areas. Teh art is learning how to find them and the best way to do that is to make offers.
hawkeye775 it’s easy to use, and allows you lots of options on how you might want to finance a property.
krspack1 hawkeye775, it looks good. How about the printable forms?
Deb I get nervous, what if they start asking questions, that I have no clue how to answer and sound rediculous
hawkeye775 it allows you to print offers
Akunauba Mike Do you oown properties in Greenville, SC. If yes what kind: single family or multi?
Mike_Summey sujay, don’t overlook the possibility of seller financing or third party financing. Bank financing is just one option.
sujaykaycee i will start looking out for them this weekend.
doug_in_CT Deb, You have got to be bold…. You can tell someone you will get back to them if you don’t have an answer and then research the answer.
hawkeye775 it will generate offers based on the financing, and will allow you to make changes, add contigencies, etc…
Mike_Summey Deb, if that happens, you will have learned about questions you can get prepared to answer on the next deal. Remember, it’s better to look stupid on one deal than to stay dumb the rest of your life.
hawkeye775 there is some good information on the website.
Mike_Summey Hi Jess
Deb Cant carry my weekend millionaire books with me huh?LOL
krspack1 Hawkeye775, Thanks!
hawkeye775 Mike, how is the best way to find third party financing?
krspack1 Mike, Thanks for hosting the chats! Have a great night
hawkeye775 I saw some adds today in USA Today related to financing RE.
Deb Your absolutely correct Mike. Thanks for the words of wisdom
doug_in_CT Deb ….Now is the time to be buying….It is a perfect storm for buyers.. … Lower cost houses.. low interest rates…. little competition… No wonder Mike is going out looking at 16 properties tomorrow!
Akunauba Mike Is the chat back on weekly?
Mike_Summey Deb, if they are a security blanket, by all means thake them with you. Many people keep the CD program in the car and listen to it on the way to look at properties. That keeps info fresh on your mind while you are looking.
sujaykaycee mike…i am a student doing my masters currently …would financing be available for a student like me.
Mike_Summey Akunauba, no we will be hosting the chats on the first Monday of each month for a while. We’ve had a good turnout tonight. Maybe we will increase the frequency later in the year.
doug_in_CT What did the USA today adds say hawkeye?
Akunauba Mike The market is making a transition. Please consider hosting weekly chat again. We have a lot of questions to ask.
sujaykaycee i agree with Akunaauba…we need more chats
Mike_Summey sujay, as a student, you will probably have a hard time getting bank financing. You may be limited to seller or third party financing until you become gainfully employed and establish a credit rating.
Akunauba Sujay Thanks
Deb Well thanks all for the good info, have a good night! Hopefully I will have made an offer on a property before the next chat!
doug_in_CT A worthy goal Deb!
hawkeye775 one was for bridge loans, one add for foreclosures “u find/we finance split big profits!”,
Akunauba Mike Do you know of a good REO agent in the Los Angeles area.
sujaykaycee my credit is pretty good..730 last month and i know i will have a job lined up in July… do u think that this market will remain the same way till then.
hawkeye775 another was for private capital for RE
doug_in_CT I think it is true Hawkeye775 if you find a good deal that you can find the financing.
Mike_Summey Akunauba, & sujay, make a list of the questions you need answered and bring them to the next chat on March 9th. For the next few months we will only be hosting a chat on the 1st Monday of the month. Right now I’m so busy looking at properties, it’s hard to do just one chat a month. By summer we might try 2 per month .
sujaykaycee will do that
Mike_Summey Akunauba, no I do not. Roger Dawson might, but he couldn’t be with us tonight
hawkeye775 thanks Mike
Mike_Summey sujay, I think the market will be even better in July. We’re a long way from the end of this downturn.
Akunauba Mike Thankks
Mike_Summey I expect to make at least 6-8 offers tomorrow. maybe 1 or 2 will be accepted.
hawkeye775 good luck tomorrow, Happy House Hunting!
Joshua Thanks for a great chat Mike!
Akunauba Mike Thanks for the information.
Mike_Summey We’ve had a good turnout tonight. That’s what I like to see instead of just 5-6 people. Everyone should make a list of the questions you would like answered before the next chat so we can maximize the time.
ncbob Thanks Mike
Mike_Summey Untill next month…goodnight all. Thanks for joining me a HAPPY INVESTING!
sujaykaycee all the best for tomorrow mike
Akunauba TMike Good night
doug_in_CT Thanks for the imput Mike and best wshes on the big buying trip…. I hope you bag a couple!
markl good night
sujaykaycee thanks for the input
sujaykaycee good night all
sparky37 nite all

» Filed Under Chat Transcripts

Comments