Half Way Through 2009 … Are You Where You Want To Be?

I was just on the phone yesterday with my brother (my much older brother) wishing him a happy 33rd birthday. We couldn’t help but talk about how fast time seems to fly.

Have you ever woken up one day and thought to yourself, “Where did all the time go?”

I had a moment like that earlier today when I suddenly realized that we’re half way through 2009! It seems like just yesterday I was writing down my goals and formulating my plan for the year.

Just like in a football game, now is the perfect time to take a “half time” so that you can rest, think about what you’ve done well and what you’ve done poorly, and invest everything you’ve learned into your game plan for the remainder of the year.

Check out the video below . . .

With that said, it’s time to reflect on the first half of this year. Are you where you want to be? Is 2009 turning out to be the kind of year that you know it could be . . . or are you still just doing what you’ve always done and getting the same old lousy results?

What’s holding you back? Why aren’t you achieving what you know you should be?

Here’s what I want you to do . . . in the comment section below, tell us what one major roadblock or obstacle is holding you back? If you’re not sure, just imagine that you are sure and know what one thing is blocking your road to success, what would it be? And tell us why you think that is?

We’re here to help. We want to help you formulate a game plan for the 2nd half.

We’ll be checking back here regularly to respond to your comments.

Get ready to put your game face back on . . . 2nd half is about to start.

- Patrick & Trevor

Want more private money videos? Check out our YouTube channel by clicking below (subscribe to our channel while you’re over there so you don’t miss out on any new videos) . . .

PMBP Quickstart Call #4

Whew! Gotta love the technical difficulties… but we perservered and got it up in your members area for ya.  Better late than never huh!

Anyhow, this Quickstart call has been one of the most popular ones based on the number of questions and comments we’ve gotten so far.  Basically, we’ll walk you through how to use the internet to generate a ton of leads for your real estate business and to get more private money for your biz.

Quick note my attorney makes me say. Before you start to do any marketing run it by an SEC attorney first. Well worth the couple hundred bucks it’ll cost. I’m not an attorney so don’t take this vid as legal advice… capishe?

Enjoy

P.S. – It’s a solid 2 hours long… but 100% full of content. Grab a pen and pad and get ready to implement when you’re done.

Resources:

Here are some of the resources mentioned on the workshop.  These are resources we personally use in our own businesses everyday.

• Autoresponder to automate email follow up and to manage your email database – Aweber
• The Internet Marketing free workshop mentioned
• REItheme highly search engine optimized real estate investor websites

12 Powerful Tips to Getting Private Money

What would your real estate investing business look like if you had an unlimited source of capital to fund your deals? Let’s just say you had access to a million bucks in private money at your disposal . . . what kind of profits could you turn that into by doing great real estate deals? How would that affect your lifestyle?

Well, that’s a reality now for one of our students (and this kid is in his mid twenties). He just locked up access to a million dollar credit line from a private investor and is about to go gangbusters in his market down in Florida.

Anyway, let’s dive right in and get to the meat and potatoes . . . because that could be you! You can have access to all the cash you want and need for your real estate deals . . .

12 Powerful Tips to Getting Private Money

1) It’s Easy to Get

I recruited my first private money lender when I was 22 years old . . . and if you’ve ever seen a picture of me, you know that I look young for my age. Soooooo, when I signed up numero uno, I looked like I was 17.

People talk about getting private money like there’s a big mystery behind it and say, “Everyone that I talk to wants to hold on to their money right now and is worried about the real estate market.”

That may be someone’s conditioned response but when you educate them on the process, how it works, why it makes sense, and you ask them good questions to elicit their needs and goals, the investment opportunity sells itself.

Come on guys . . . if a 20 something college drop out that looks like a teenager can do it, you can too!

2) Private Money Is All About Personal Relationships

By personal relationships, I mean relationships that YOU build in order to get private money. I often times get asked what one of my private lenders would charge to finance a deal. And I have to tell them, that’s not what it’s all about.

Get out there, spread the word that you’re a real estate investor, that you have great investment opportunities, and cultivate rock solid personal relationships.

3) No Credit . . . No Problem

Private money loans are based on the property, not the person. When you have a great deal under contract . . . let’s say for $120K that’s worth $180K . . . the person that lends you the money is doing so based on you buying the property far under value.

4) Virtually Unlimited Quantity

A private lender is just an everyday person who lends money to you as an investment rather than investing the traditional way through CDs, mutual funds, stocks, and bonds.

Anyone that you know and everyone that you meet is a potential source of private money. Most people, especially in today’s market, are looking for good opportunities to invest.

You’ll never run out of private money prospects for your real estate investing needs.

5) Process of Harvesting Funds

Check out the article 4 Steps to Harvesting Private Money for Your Deals. It breaks down the process to … till the soil, plant seeds, nourish your field, and harvest the crop.

6) Go for the Formal Appointment

This is one of the vital pieces to the private money getting puzzle. Investing in anything is a serious matter and should be treated as such. Once you pique someone’s interest with your 30 second commercial, you go for the formal appointment.

This is where you meet with all decision makers to present your investment program and educate each prospect on your business model and how it relates to today’s market.

7) Use a Professional Presentation

The presentation that you present to your private money prospects should be professional and specifically crafted for optimal success. If you don’t already have one, you can download the private lender PowerPoint presentation that I cultivated over the years.

There’s a script included to show you exactly what to say and how to say it as well. Also, I’ve studied sales extensively and integrated an advanced sales process into the presentation. It’s some pretty powerful stuff . . . enjoy!

8 ) Make Your List

Here’s your first action step . . .

Now, this is a brainstorming session. Which means, do not attempt to qualify your answers . . . just write down what comes to mind. One of the biggest mistakes I see people make time and time again is to disqualify people.

I want you to write down the first five people that come to mind that you could set up an appointment to present your investment program. DO IT NOW!

If you are already reading this sentence, you didn’t listen to me. Please stop reading this and write down five people.

OK, now write the date by which you will have called them to set up your first private money presentations.

By committing to following through on this action step, you are on your way towards getting your next deal financed with private money.

9) Listen to Henry Ford

I thought I would bring in the wisdom of Mr. Henry Ford to help us out a little bit . . .

“If you think you can do a thing or think you can’t do a thing, you’re right.”

This is powerful advice! Your expectations will play a major role in your success or failure at getting private money. The simple fact that there are thousands of investors all across the country that use private money to finance their real estate deals should be proof enough that you can do it too . . . regardless of age, race, your network, your net worth, or any other excuse you may come up with.

10) Follow Up Until They Buy or Die

The key to my success over the years at building my base of private lenders was aggressively following up with people (after I had shown them the PowerPoint presentation) until they lent me money on a deal or told me to get lost . . . and the latter never happened.

After you formally present to someone, you will have gathered some much needed information from your prospect about their needs and goals. Now as you follow up with them, only present deals that match the criteria that you gathered at your meeting.

And use my philosophy when you need to get a deal financed . . . “Ask until.”

11) Where to Find Private Money Prospects

One of the best places to find potential private lenders is at your local real estate investment club meeting. Often times, these meetings are filled with people who have heard real estate investing is lucrative and want a piece of the action but don’t really want to go through the process of learning how to do it themselves . . . that’s where you come in!!

Educate them on how they can get involved investing in real estate without having to do anything other than writing a check.

Also, check out this article on the 4 Types of People Most Likely to Lend You Private Money.

12) Business Card Reversal Trick

This is where you use the back of your card for a marketing message that piques someone’s interest in your investment program without you having to bring it up in the first place.

Here’s what you do . . . on the back of your business card, have a phrase like, “Learn How to Make High Returns Backed By Real Estate! Email at _____ For More Info …”

Now, when you hand out your business card, you’ll have people ask you what this means. Instead of you just telling people about your investment program, people are asking you about it . . . which is where you want to be.

- Patrick & Trevor

P.S. – Here’s a great free resource for you that we found that will save you a ton of time in looking for great real estate resources online.   We thought you’d enjoy it so we’re passing it along for you.

How To Buy Apartment Buildings With Private Money

One of our PMBP Platinum students called Patrick and I this week to get some last minute questions before he does his first “private lender group
pow wow” for a bit of our advice.

Anyhow, we got to talking and he just got a HUGE property under contract ($1mil apartment building) and already has all of the private $ lined up for it… 30 days before close (we taught him how to get those lenders).

Long story short… Tim’s business model for buying apartment buildings with private money is just like mine.

Buying Apartments With Private Money Simplified Process

Here’s how it goes:

1. Market for sellers who have owned the property for 10 years or more (the more time the more equity)
2. Negotiate with seller to have seller  carry as much of the note back as possible. I prefer at least 80%.    – Tim got a 10% rate which still helps him cashflow the property, I usually go for between 6-8%.
3. Bring in private money lenders for the downpayment.
   1. Tim brought in $80k in private money from two lenders for this deal.
   2. Own a property w/ HUGE leverage, positive cashflow, and little to nothing out of your own pocket.

Sounds simple… cause it is.

The trickiest part of the whole thing is finding enough property owners to talk to on properties that match your buying criteria.

Not all sellers of course will want to or have the means to be able to carry the note.

However, when you really target the RIGHT sellers you increase your odds and closing percentages big time.

Types Of Property Owners I Target

I like to target this type of seller for apartment buildings:

• Owned property for 10 years or more
• Is nearing or in retirement (45-60 years old)Property is in good shape but might need a bit of cosmetic work/upgrades…
• …and as a bonus. If they seller manages the property themselves it’s even better!

It’s better because when you say the right things you can show them how you can pay them the same or more than they’re currently
making in cashflow per month if you buy the property… and they no longer have to worry about managing the place, doing repairs,
fixing toilets, etc.

Once you’ve negotiated with the owner on the purchase price and seller carry, now it’s time to get a hold of your private lender prospect list and start using the 30 second commercial, setting up 1 on 1 appointments… and gear your presentation a bit toward the end on this specific deal.

Let the strength in the deal numbers “sell” the deal for the private lender to show them it’s a no lose for them.

For Tim, our student… he got the property under contract and the seller agreed to close in I think it was 60 days… don’t quote me on that though.

Then, Tim had already been talking to people and planting seeds about what he’s doing and giving his 30 second commercial.

So, he went back to those people who showed interest and told them about the deal… and asked for a 1 on 1 appointment to show them more details.

He secured the one lender for $40k using his presentation…

… then asked that lender if he knew anyone who would be interested in this deal.

(KEY: Ask for referrals… that’s one of the best sources of instant credibility and makes it much easier to built trust with the referral).

Tim talked to the referral, presented his presentation and deal… and locked up the other $40k he needed right then and there.

Done deal.

The only difference between Tim and other people who haven’t seen this kind of success is that he took what he learned and took action on it.

He did a great job finding a great deal… and we helped him get the confidence to get the private money for the deal.

Here’s the stats:

• Purchase Price: Approx. $1,000,000
• Seller Carry: Approx.   $      920,000
• Private Money: $        80,000
• Money out of Tim’s pocket = $        0

(I believe the private lenders are paying for the closing costs too for Tim!).

That goes to show that there are great deals to be had out there and that those deals go to those who take action on what
they learn.

So, get out there and use some of the tips from this article to find a great property and fund it with private money so you don’t have to take a dime out of your pocket to own a million dollar property.

Lol, I get emails every week from people asking if the “no money down” deals are real… they’re skeptical.

Well… they’re 100% real… they’re all over the place… and if you don’t think they are out there… well… more for me and Tim!

- Trevor

How Do You Ask Someone For Private Money?

This is one of the top questions asked by investors wanting to get private money for their real estate deals …

“How do you ask someone for private money?”

When I got started on my private money getting journey, I found myself dreading asking people for money. Money was just one of those subjects you didn’t bring up let alone go into explicit detail.

So, we were under the gun to get a deal financed, and I didn’t know what to do. I was in a very unmotivated flat out negative mind frame. I was sick and tired of asking people for private money! Doesn’t sound like a very good place to be, does it?

It was about that time when I knew something had to change.

Sooooo, I tweaked my approach. I remembered something that I had read from a book earlier that month (I’m an avid reader if you didn’t know it already) and like magic … EVERYTHING changed!

Check out the video now to learn “the difference that made that difference” …

Now you don’t even have to ask for private money … and you can still get it!

Isn’t that cool?

- Patrick & Trevor

How to Get Private Money at Your Local REIA Group

Got a question from one of our private money students recently and wanted to share it with you …

Great question, Gene …

At my local REIA (real estate investment association) meeting, the group leader always asks if anyone has a deal they want to pass by the group … what a GREAT opportunity to present your deal to potential private money prospects.

For those of you that don’t already know, I’ve turned tons of people that I’ve met at my local REIA group into my private money lenders … even ones that are active investors themselves.

Check out the video below for a complete script of what to say (even if your REIA group doesn’t give you a chance to pitch a deal during the meeting, the script can be crafted to a single person or small group).

Soooooo, when you need to get a deal funded ASAP, here’s what you say …

I thought I’d make it really easy for you and type out the meat and potatoes from the video for you as well …

4 Fundamental Elements When Presenting for Private Money to Your REIA

1. Paint the Big Picture
2. WIIFT (if you don’t know what that stands for, guess you have to watch the video
3. Promote Scarcity
4. Disqualify Them

**Private Money Power Script**

WARNING: When using this alluring script, you may have to break up a fight … a fight between everyone who wants to fund your deal!

————————————————————

“We have an excellent deal under contract … a 52 unit building that we’ll be closing in the next <X> days. We’ve already done our homework and KNOW that this deal is rock solid.

Now, this opportunity isn’t for everyone … but there is a chance for one lucky individual to jump on board with us and make a great return. We’re bringing in a private investor for $ <X> Dollars to provide the cash needed to do the deal.

This person will … simply by writing a check … make a great safe return on their investment dollars … not have to deal with the hassle of owning and managing real estate … not have to deal with contractors or tenants … (because we do EVERYTHING for you) … not have to spend an ounce of their time … and still receive all the excellent benefits that real estate investing has to offer.

As you can imagine, this opportunity will not last long … they NEVER do … because we’ll have a private investor committed to fund this deal by next <X>.

Soooooo, if you want to jump on this opportunity before it’s gone, write the best time for me to call you on your business card and get it to me before I leave tonight.

Thanks and again … we know that this ISN’T for everyone … just those looking for a easy, hands off, safe, excellent return backed by real estate.”

————————————————————

The primary way we teach to get private money isn’t to “pitch” a deal to a prospect first … it’s to pique a person’s interest and get them into a formal appointment. BUT, if you have the opportunity to present a deal to an entire room of real estate investors … DO IT! And, this script can come in handy when you’re under the gun to close fast.

Not sure if Gene already has his deal funded so if anyone wants to hear more about his private money opportunity, throw a comment below, and we’ll hook you guys up.

- Patrick & Trevor

Are You Asking the Right Questions to Borrow Private Money?

The most effective strategy to borrow private money is to ask your prospect the right questions. Questions that elicit motivation, questions that uncover goals, questions that make the prospect imagine themselves enjoying and benefiting from your investment program.

When you borrow private money, here are 5 questions to ask prospects . . .

(Quick Tip: Make sure to write down everything a prospect tells you when you’re going through these questions. This is valuable info!)

1) What experience do you have investing?

Find out if they are or have invested in CDs, mutual funds, bonds, stocks, real estate, race horses, or gold. This will help you get a good picture of the type of investor you’re dealing with, their expectations, how knowledgeable they are with investments, etc.

If they have any experience investing in real estate, you want to know the details. What did they like? What did they dislike?

The prospect’s answer will indicate whether they primarily move away from pain (losing money or earning meager returns) or towards pleasure (making more money/better returns/financial freedom). Note whether they move away from pain or towards pleasure. You will present your investment opportunity to them based on this information.

2) Are you happy with the performance of your investments (investment portfolio)?

Whether they are happy with it or not, you ask the same question next . . . “What average rate of return have you been getting from your investments?”

At this point, if they tell you a 20% annualized return, you can let them know it was nice talking with them and move onto the next prospect. You just saved yourself some time.

Let’s say the prospect said he or she was earning a 6% return on x-investment. At the end of your presentation, you could say something like, “Well, I’m not sure if we can do this or not but . . . what if we could offer you a 8% annualized return backed by real estate . . . would that be something that might work for you?”

3) Whether or not our program is a fit, is it important that you find the right investment opportunity soon?

If they say “no,” this may be a good person to add to your follow up list. You could also say something like this to them, “Sooooo if the money stayed in x-investment earning x% for say another 6 to 12 months, you would be fine with that?” Or, “If your money just sits there earning you nothing for x-time, you’re ok with that?”

If they say it’s important to find an investment soon, you have a green light to continue moving forward towards turning them into a private lender.

4) Are you more interested in making a quick buck or building wealth?

This is another way of asking if the prospect is interested in a short or long term investment. We would prefer that the person invest long term. So by saying “quick buck,” we’re already putting a negative connotation around that idea. The longer term you can negotiate, the better.

If you find out the prospect just wants to make a quick buck, it may be best to move on.

5) What would the right investment provide for you?

This question is key to get the prospect visualizing a positive experience with your investment opportunity. And we’re not even referencing our investment.

Get your prospect to imagine retiring one day with complete financial security, going on that dream family vacation, feeling safe and secure and your prospect will associate those feelings with your investment program.

Remember, borrowing private money is all about asking good questions. So ask good questions and then keep your mouth shut. The more you learn about your prospect, the better the chance of converting them into a private money lender.

- Patrick and Trevor

PMBP Quickstart Call #3 – With Special Guest

Hey, here’s your Quickstart Call #3… and this one is a pretty cool one.  We invited on a full-time investor out of my home state of Oregon to share with you how he gets private lenders for his own real estate deals.

He specializes in probates… and every now and then needs private money to close on the deals he doesn’t flip right away.

So, press play and let’s get rolling!

7 Effective Follow Up Phrases To Win More Private Lenders

No matter whether you realize it or not… there’s a VERY fine line between successful people and unsuccessful people.

There’s an even finer line between someone who successfully “gets” private money… and someone who says “I’ve tried all of this and it doesn’t work” (aka, an investor wannabe who would rather make excuses than work to get better at what they’re doing).

And, one of the ways that you can separate yourself from the “wannabe” group and put yourself in the successful group like us is to just sharpen up what you say to people.

So, Patrick compiled 7 extremely effective (but extremely simple) phrases you SHOULD be using to be the most effective in your life, business, and “private money getting”.

If after you read these you say, “I already knew those… and it still isn’t working to make me successful”… I can already say that you’re currently in the “wannabe” category and need to make the decision to go out, stop making excuses, and start actually implementing in the real world what you learn.

So… write these phrases down, memorize them, and use them every chance you get. No matter how simple they sound… these could mean the difference between you securing private money which leads to a deal with $35,000 in profit… or flushing those $35k smackers down the toilet.

1) Did I catch you at a bad time?

I already explained in detail why we phrase it “bad time.”

If you do catch a prospect at a bad time, you want to know it because they likely will not be paying attention to what you’re saying. You want their attention to be focused on you. When it’s not a good time to talk, ask them what would be a better time for you to call back. Do not let them tell you that they’ll get back to you. You want to remain in control.

2) I thought of you when this opportunity came up and called you first . . .

People naturally have an urge to want to feel appreciated and important. That’s one of the things that people want most out of life (whether they realize it or not).

By saying, “I thought of you,” and “called you first,” your prospects will feel appreciated and important.

3) This probably isn’t right for you but . . .

This keeps you in the unmotivated role . . . which is always where you want to be. You’re also disqualifying the person from what you’re offering. People hate to think that they would not be qualified for your opportunity.

This also takes you out of the salesman role in their minds. When most people think of a salesman, they think of someone shoving nothing but positive features and benefits down their throats pushing towards a sale. Although saying, “This probably isn’t right for you . . .” may seem counterintuitive, it’s a powerful way to use language to your benefit. Use it and see for yourself.

4) I’ve got an excellent opportunity for the right person, not sure if that’s you . . .

This statement conveys that it’s not a question whether or not the investing opportunity is sound, the only question is whether the prospect is the “right person.” Then, you finish it off with “not sure if that’s you” to again take you out of the salesman role in the prospects mind.

5) I’m going to have this deal financed by x-date, so if you are interested . . .

Promote scarcity! Having a limited number or a limited time frame will always increase sales no matter your product or service.

Letting the prospect know that you’ll have the deal financed by a certain date does two things . . . It tells them that they need to act fast if they want to get involved and promotes you as a confident businessman.  It’s not a matter of whether or not you’ll get it financed; it’s a matter of who will take advantage of your opportunity the quickest.

If you have confidence in yourself and your investments, other people will too.

6) When should I expect to hear back from you?

So, the prospect has shown interest and told you that they would think about it or check on the availability of their funds or talk to their spouse. Ask this question so that there is a clearly defined next step as far as your communication goes.

Make sure they are specific with their answer (as in next Monday). I usually follow up their response with, “Ok, Monday sounds great. And I know that we’re both busy people. If I haven’t heard from you by Monday afternoon, do you mind if I follow up with you?”

7) Would you like me to notify you of our next opportunity?

This ensures that the people on your follow up list do in fact want to continue being contacted with future opportunities. I found that everyone I contacted was delighted to hear from me and be presented with the opportunity even if they weren’t interested at the time.

So, write those down… and start to use them.

Being a successful real estate investor and “private money getter” is as much about the way you talk to people as the numbers in the deal.  People who learn even the simplest of sales, negotiation, and persuasion techniques will be cleaning up in this buyers market while the others will be left scratching their heads wondering why all of these deals that “pencil” aren’t turning into profits for them.

Now, get out there and start kicking butt!

- Patrick and Trevor