Tip for Landlords: Section 8 Tenants

Over this past weekend, I attended a one-day seminar presented by Dave Seymour of the RE Mentor company (www.REMentor.com). For those of you not familiar with this group, this is founded by David Lindahl, a commercial real estate guru.

Certainly, I learned many things that introduced good things to me, but this one keeps resonating through my mind:

Section 8 Tenants: Make it a requirement that they have a job.

Let's explore...

Downside: Less guaranteed money (Yeah, isn't that the BENEFIT of a Section 8 Tenant?)

Upsides: person tends to be more responsible, spends less time sitting around beating up your property, tends to have more ambition (read: might clean the place once in a while--increased self-image equals actions reflecting more pride), and they tend to be more grateful.

More grateful?

A lot of people receiving Section 8 rent subsidy--only partial--often have a hard time finding a place they can live since many landlords are scared by them. Most landlords like Section 8 tenants, because they represent guaranteed money. Tenants with partial subsidy do not provide this; so many landlords get discouraged. However, this tenant base cannot afford housing on their own. That's why they are getting SOME subsidy in the first place.

Here you are willing to provide them a place to live that fits within their budget. They want to keep working, because they won't be able to afford to keep renting from you, otherwise. You are one of the few people who will do this for them.

I'm not sure about you, but after this perspective was presented to me, I know that if I ever become a landlord which type of tenant I prefer.

From my perspective, great idea, Dave!

Market Yourself for Free: Make a Blog

I know a lot of beginning investors who want to advertise their service, but I hear them complain that they don't have enough money to advertise.

How about I talk about one of the ways you can advertise--FOR FREE?

You can advertise yourself writing a blog. (I use Blogger.com, but there are others, if you prefer.) The idea is to provide information that will help people. This way, they WANT to return, maybe even telling other people about your information that you offer. Ideally, you can create a link to your website. Even if you do not, is there anything stopping you from putting in your phone number or e-mail, if you're trying to generate calls?

Some people are worried that it won't look professional like those other websites. Let me put it to you this way. Would you rather visit a professional looking SALES site, or would you rather visit a place that looks so-so but has AWESOME information? I know my answer. You can make your blog look like a sharp website. (Don't use mine as an example. This isn't my objective.)

Plus, there are a whole lot of other twists. Just to name a few: Adsense, Affiliate Marketing links, and Links to Partner Sites.

The biggest thing I see is that is gives a beginning (or anyone else) a chance to advertise (preferrably passively) what they do, and this can be done for free.

So now that you have, at least, one place that you can advertise yourself for free, what's your excuse NOW?

Testimonials: Don't Need to be Perfect: Just Go Get 'em

I know that I don't need to tell anyone that it's always a good idea to get other people saying good things about you. It's also stating the obvious that it helps when we can document these good words about us.

So, why do we all know this, but we still use don't really get them? (I'm included in the guilty party here.)

This post is to honor someone who does a great job with this. Plus, I want to shed some light how easy it could be.

Must all testimonials be IN WRITING? I think you know the answer to that, but here are a couple of examples from a couple of people in a company called The Best Michigan (TBM) Homes (owned by Saravanan Peelamedu and Ron Ristovski) at www.TheBestMIHomes.com.

From a home buyer:



From an outside investor to this company:



How long do you think THESE took to make? No, they're not high-production quality, but the important part is that they have proof from other people that they do a good job.

Basically, if you've done something good for someone, and you know they appreciate it, why wouldn't they want to help you help other people the way you helped them? Just ask for them. Don't be shy!

Quick Tip: Marketing through Networking: Post Comments on Other People's Work

Would you like to bring more people to your site? The more people you have visit your site, the better chance of getting them to buy from you.

Here is a quick tip that only recently occurred to me.

Post comments on other people's work.

1. Will position you to learn something new. This is always a good habit, anyway, but you will try harder to learn new things when you're looking for new places to comment.

2A. Generates intrigue from the Author. Most services send an e-mail to the author when you place a comment. Even YouTube does; so I am using the term "author" loosely for this--doesn't matter.

2B. You will probably earn a warmer lead from that author. Comments help people's pages get a higher search result ranking, bringing them closer to the top of a search. Think the author won't appreciate it?

3. Generates intrigue about you. Especially if you leave an interesting comment. If you make enough of these (or place one on a site that enough people see), you will have people wanting to learn more about you.

4. Could generate more traffic to your site. This occurs one of two (2) ways: profile on that service containing a link to your site or placing a backlink to your page on that site. Be careful! If you have the luxury of placing your link on their site, this will help your sites search engine rankings, bringing IT closer to the top when people search.

Where can we place comments? Just about anywhere: YouTube, articles, press releases, blogs, Facebook, etc.

So let's all try to support each other. Let's find each other's material and place more comments.

Ask for Help: Don't be Afraid

Even if you are not an investor (but it's true especially if you are), ask for help.

Years ago, I remember someone telling me that Ted Turner (You know, the owner of the Atlanta Braves, WTBS, and probably many more things?) got started with a small radio station. He went on the air, and he simply asked people for money. I don't know whether this will work all of the time, but it seemed to work so well for him, I think we'd all be foolish not to try. I don't know comfortable I am asking for people's money, especially when I am just learning something, but I've learned to feel more comfortable asking for help.

Asking for help (often) does a lot of things for me:

• Makes me stop fighting myself: I'm not always happy to admit that I do not know something, or that I cannot accomplish something on my own. Once I realize that I can't or shouldn't go solo, then I stop wasting energy. Many people do not want to "look stupid." I don't mind "looking stupid," but I really do not want to do stupid things.
• Builds My Network: Many people, including myself, love to help people. Other people, including myself, love to be the expert at something. Some people will be irritated by the request, but many people appreciate a chance to share their world with you.
• Provides Me More Information to Teach Other People: This also builds my network of people, which might help build a customer list. Also, learning material that I teach later only forces me to learn things better.
• Supplies You with Help You Need: Duh! Isn't this what we wanted or needed in the first place? The important part of this is that it allows me to spend more time implementing good ideas than simply trying to figure out them. Analysis is really fun for me, but being able to deliver results earn a feeling that is tough to top.

I know that a lot of people have a hard time with this. If you fall in this category and have questions, please ask me. I'll gladly walk you through it. Just like there are benefits to asking for help, providing help does, too.

Thanks for Your Support

This does not count as a "post" that will meet my "committment" that I sent to people (MIN: 4 Posts/Week).

However, I want to thank everyone who is helping me commit to doing something toward my goal and doing it constantly. I am amazed how many people offered support and help.

My personal goal is to post every day. I will have the most difficult time meeting this goal when I have events that last deep into the evening following work. This does not mean that I will not do it, but I'm still struggling to find a way to make it happen on these nights. (Notice that I missed last night.)

So...Thank you, everyone. The response was a whole lot better than I could have ever imagined.

Investors Need a Buyer? Consider Reverse Mortgages: A Solution for Seniors

Many real estate investors already know about Reverse Mortgages.

However, I bet many newer ones do not. Truthfully, I am still trying to wrap my hands around this concept.

Many investors are having a hard time finding buyers, because many buyers have no cash or credit to buy. A possible solution to help is Reverse Mortgages.

Oversimplifying this, Reverse Mortgages allow (some) seniors to get a monthly payment from the bank or some other lending institution as long as they live in the house.

There are some rules. The senior MUST

• Be, at least, 62-years-old
• Have no remaining balance (or nearly no balance) on his or her home
• Live in this PRIMARY residence

A Reverse Mortgage is a loan against the equity in your home that you do NOT need to repay as long as you live in the home. The monthly amount the senior receives will depend upon the person's age and home value.

Let's be fair. There are downsides.

• When the senior passes, the monthly payment he or she was receiving turned into a loan that needs to be repayed. There is interest on top of this, too.
• Also, if the person living in this home dies, the home is sold to repay this debt, and the home cannot be passed onto his or her heirs.
• If the person living in the home decides to move, the loan--plus interest--will need to be repaid.

How can this help an investor?

• Seniors can use the money they get from the reverse mortgages to buy an investment property from you. You now have a buyer with some money, which is a premium quality in this credit-starved market. Don't you think?
• If you have a senior family member who qualifies and wants to live in his or her home until death, this can be a potential income source for your investments, provided he or she trusts you (and you are trustworthy).

If someone reads this and realizes that I explained something poorly or incorrectly, let me know, and I will fix it.

Over 15 Great Things about The Detroit Area

In the last post, I mentioned how I envision Detroit after improvements.

In THIS post, I want to identify things that are ALREADY really good about the Detorit Area.

• Professional Sports Teams: Red Wings, Tigers, Lions, Pistons, Shock
• Proximity to Universities (within 2 hours): UM, MSU, EMU, WSU, Adrian College, Albion College, Alma College, Olivet College, University of Toledo (Ohio)
• Coney Island Restaurants: Coney Dogs
• Arabic/Middle Eastern Restaurants & Culture: Largest Arabic Population outside of Middle East
• Pizza Papalis: Chicago Style Pizza
• Greektown
• Casinos
• Close Proximity to Canada
• Henry Ford Museum
• Greenfield Village
• Italian Bakeries & Fruit Markets
• Eastern Market
• Woodward Dream Cruise
• Mexicantown
• Close Proximity to Beautiful Parts of Michigan, including beaches and parks
• Near Many Orchards

What else have I missed?

My Vision: Real Estate in Detroit

I like to give tips, although it's hard, sometimes, because I'm just learning real estate.

Today, I'm going to share a little about what I envision for the future and how I see real estate being a part of that. Specifically, this is going to be about investing in Detroit, but it will apply to other downtrodden urban areas, too.

This is going to be a heart-to-heart more than a professional focused post. So hang onto your seatbelts, Ladies and Gentleman.

1. Bridging the Gap

This could mean many things, but I am focusing on two things, which sadly have too much connection between them.

I moved to the Detroit Area in 2001, and I've lived in several areas--more than most 37-year-olds have. Nowhere else have I seen the flagrant division between the city and its surrounding suburbs. In fact, most people won't admit they're from Detroit. I even had one person so much as say that Waterford is a suburb of Pontiac (an urban-suburb north of Detroit).

This not only is silly, but it's also harmful. Why? Economies flow when money flows freely. This statement by itself could spur its own article, but I will stick with Detroit and its suburbs for now. How can a metropolis thrive if it's heart (read: Detroit) isn't pumping blood into it's veins (read: suburbs), and the veins aren't returning that blood into the heart? That's exactly what is happening here.

The other thing I'd like to improve, if not entirely solve, is our huge problem with racism. It occurs in so many forms, but in the Detroit Area, the largest--by far--is black vs. white people. This is true in an area that has the largest Arabic population outside of the Middle East, and this relationship isn't always so cozy around here. No questions, though. The black vs. white thing is a big problem everywhere in the United States, but it's an even bigger problem here than most.

What's this have to do with real estate?

I would like to learn how to make money, and real estate is a key strategy for doing this--not the only but a key method. I want to learn the "how" well enough to be able to teach other people how to do this, too.

I remember when I was a kid, I volunteered to help tutor students in a poor section in Chicago on Saturdays. I thought nothing of it, but someone who connected me with the opportunity told me that I may be the only white person who ever smiled at them. At the time, I was too young to appreciate this fully.

However, years later, I got mugged in Winston-Salem. I was in the wrong part of town at the wrong time. I was nearly circled until I just threw my wallet away from me. It was entirely clear that I was targeted because I was white. For about a half an hour afterward, I was pretty shook up, and I didn't trust ANY black person as I waited inside the nearby store until the police came. During that immediate timeframe, I would be avoiding Obama--maybe even Tyra Banks, and she was HOT in the ninties. Seriously! How crazy is that?

Amongst many other thoughts, I started wondering, what if I hadn't ever had good experiences with black people. Once my head cleared, I realized that these were bad people who happened to be black taking out their frustrations on a momentarily vulnerable white person. My previous experiences allowed me this perspective, but not everyone is lucky enough to have good experiences to realize that this horrible situation was an exception--not the rule.

Many people who are different (men vs. women, nerds vs. athletes, etc.) tend to learn to "get along" once they are forced to work together. Another words, these people are forced into a position to realize that helpful people are better than unhelpful people, regardless of any differences. "Oh...THIS is the benefit to this person being in my life." You have enough of these experiences, the "differences" become invisible to you.

I would like to learn how to make money to teach other people how to make money, including people who are different than me. After that, I would like to teach other people how to teach other people. How easy is it for you to hate me if I'm showing you how to enjoy your life more?

Only one color really matters to me, and that color is GREEN.

2. Improving Detroit

Many people see Detroit, and they see a wasteland. "Blow it up, I say." I hear this often, and it's not unfounded, unless you see the potential. Many parts are not sparkling. However, there is a lot of nice architecture there. For those of you a little uncomfortable (or are truly afraid) of checking Detroit, ask around. There are some really nice neighborhoods in the city. Because Detroit has such a bad reputation, many home prices are the price of a nice car. Some homes cost less than a mediocre one.

I would like to improve these nice structures.

More importantly, I would like to improve entire neighborhoods. I envision an entire neighborhood getting renovated. However, there aren't many stores within walking distance. So I would like to find a way to make it attractive to businesses to WANT to move there, beside these nicely renovated neighborhoods. Of course, police presence would have to be premier. I don't know how to do that, yet, but this is essential to reviving Detroit.

You know what else ails Detroit?

Let me answer that question with a few other questions:

• Do you know anyone who lives in the Detroit Area for any reason besides family or business?
• Is there any reason, besides work or family, that you would visit Detroit if you weren't here, already?

I know! It must be the nice weather. Ummmm....Well, how about the pretty area? For some parts of Michigan this is true. Southeast Michigan, however, is not laden with beautiful areas.

So what do we have to offer? Right now? Very little, if anything.

Why not create some reasons? I don't know the answers, yet, but I'm thinking of things like a huge family friendly indoor water park. (Family vacationers bring HUGE money with them, and they spend it!) Perhaps, we can develop the nicest developed bike or snowmobile trails. After we build activity-based attractions, we can build awesome museums or improve the ones we have. We can build a specialty restaurant area that is family friendly, perhaps transitioning with Wayne State University. There's a start there, but there's so much more potential that can be realized there.

This is what I see for Detroit (and other areas that need help, too). Am I nuts, or does anyone else share my vision?

Over 10 Methods to Create Money for Investing

I believe firmly in education. So I take a lot of classes and attend a decent number of seminars. With all of that info coming at me, it's easy to lose sight of all of the cool things I learned.

So I am reviewing my mass of notes. I'm a slow reader, and it takes me a while. The upside to this is that I can enjoy this great stuff for bunches of days.

So...what's this have to do with my title?

You may have guessed, already, but I came across a memory that SHOULD be mental candy. I really like candy, so I'll make a lot of "sweet" references.

Here is one by Darrick Scruggs, the owner of My First Michigan Home and many other companies.

"Most of your problems will disappear if you become world-class at raising money."

Most people will read this and say, "Duuuuhhhhh!" Many of these same people will say that they don't have any money. If they had money, they say, THEY would be raking in millions, too.

I'm here to tell you that you NEED money, but nobody said it had to be your own. I know! Many of us have heard that, too.

Besides using your own cash, have you considered....

1. Making money as a middleman (a.k.a. wholesaling)
2. Borrowing from a lending institution (not always so easy nowadays but still can be done)
3. Refinance your home
4. Cash in on credit cards (for INVESTMENTS--NOT a new TV!!!)
5. Get a second mortgage (tap into your home equity)
6. Invest with your retirement account (401K, 403b, Roth, SEP, etc.)
7. Solicit other investors (they're always looking for good ideas)
8. Team with other investors
9. Finance with friends and family (Be careful with this one! Really!!!)
10. Work with a hard money lender (think cheaper credit card but shorter terms)
11. Explore Land Contracting

My friend took a loan from his 401K. He has to "repay" it at a rate of 4% or 5%. He used it for an investment that pays over 30% annually. Do you think he's being irresponsible using his 401K? I'm not even counting for the fact that he could cash in that investment (about 6-8 months later) and TRIPLE his original money.

Make sure that you have a plan and that you thoroughly thought out that plan. You do not want to make a habit of using borrowed money just to lose it. We all make mistakes, but make sure you do your due dilligence. Calculate your risk.

No matter your investment, remember this! NEVER...I mean NEVER "invest" more than you can afford to lose. That's called GAMBLING on the Hope-n-Pray method. Save this for your fun money. Feel free to ask me more questions about that.

For more information about Darrick Scruggs, the person who provided me this information, see his website http://www.myfirstmichiganhome.com/, especially if you want to learn more about key facts for first-time homebuyers. As a real estate investor, this is your biggest market right now. Go see his website, especially if you're in the beginning stages of investing.