3/4/12: Keeping What You Have – Asset Protection Strategies for Real Estate Investors
It’s funny how people will buy a fancy new car or a big new home and invest a bunch of money into a security system. Yet so many real estate investors don’t put any thought or money into creating a security system around the equity and cash flow building up in their investment properties. And if something goes wrong, not only are the rental properties at risk, but so is the fancy new car, big new home and every other of their prized possessions!
Since this is the time of year most investors are neck deep in reviewing their finances and preparing their tax returns, we thought it would be a great time to get an update on the wonderful world of asset protection.
Sitting down at the microphones for this edifying episode of The Real Estate Guys™ radio show:
- The bodyguard of broadcasting, your host Robert Helms
- The body odor of broadcasting, co-host Russell Gray
- A man with a large body of work on the topic of asset protection, attorney Garrett Sutton
The United States is the lawsuit capital of the world. And even though our show is now downloaded in over 160 countries, many folks throughout the world are coming to the USA to pick up bargain real estate (and who can blame them?). Plus, many of the essential concepts of asset protection are applicable in jurisdictions around the world. So no matter where you’re from, there’s something for everyone in this episode!
The basic concept of asset protection is the utilization of entities to create legal separation between assets. These entities can also be useful for privacy, tax and estate planning purposes. And the bigger your collection of properties becomes, the bigger a target you become for financial predators of all types. The sooner you get your asset protection structure built, the faster you can move when adding properties to your portfolio.
If you’re unfamiliar with the basic concepts, we recommend you do some reading before you sit down with an attorney. No point in paying out hundreds of dollars per hour for a basic education. However, with that said, once you’re ready to actually implement a plan we STRONGLY suggest you engage a competent attorney to actually help create the plan and form the entities. There are lots of “fill in the forms” do-it-yourself websites for this type of thing, but they don’t come with professional advice and errors and omissions insurance. If an asset protection plan makes sense for you, then it makes sense to do it right. At least that’s our not so humble opinion.
We’d love to share more, but we’re guessing you’d rather hear from the real expert, so listen in to our conversation with Garrett Sutton. Then jump into The Real Estate Guys™ Recommended Reading bookstore and pick up some books on the topic, including Garrett’s recently updated Start Your Own Corporation. Before you know it, you’ll be proudly pontificating on asset protection principles – and you’ll be the life of the party!
Listen Now:
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The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources that help real estate investors succeed.
Trump, Kiyosaki and Robbins LIVE in San Jose, California April 10-12, 2012
See Donald Trump, Robert Kiyosaki and Anthony Robbins LIVE and IN PERSON April 10-12, 2012 in San Jose, California!
If you’re reading this, then we’re guessing you care deeply about your personal success. You probably want more than you have and are looking for great ideas to help take you to the next level. Congratulations! You’re in the right place.
In every generation there are people who become living legends, icons in their field and powerful brands that millions of people recognize and identify with.
In personal development and motivation, no one is more recognized than Anthony Robbins. Millions of people around the world including actors, athletes, captains of industry, powerful politicians and ordinary people of all types have turned to Anthony Robbins to make life-changing breakthroughs in their personal achievement.
Robert Kiyosaki has impacted the lives of tens of millions of people through his teachings on personal finance, investing and entrepreneurship. His signature book, Rich Dad Poor Dad has been translated into dozens of languages and is the best-selling financial book in history.
And of course, Donald Trump is one of the best known real estate and media personalities on the planet. He almost needs no introduction.
What do these amazing achievers have in common and how can they help you?
We can’t presume to speak for any of them (that’s why you should go hear what have to say for yourself), but based on our conversations with Robert Kiyosaki, reading several of each guy’s books, and having seen them all speak several times, we have some ideas.
First, they want to make a difference in the world. Just like Steve Jobs told John Sculley when he was recruiting him away from Pepsi to join Apple, their businesses are bigger than just making money. They want to change the world.
Next, they know the power of ideas. Each one, in their own way, talks about how super-achievers think. And that the difference between being average and being exceptional starts with what’s happening inside your head. Read any of their books and it becomes very clear that they all believe in the power of the mind.
We also think they understand the power of being there. All of these guys, and especially Trump, can reach millions of people through media for a lot less hassle than flying into San Jose to talk to a few thousand people in a conference center. And none of them need the speakers fees. It’s obviously important to them to be there live.
We know that when you get people in a room to hear a live presentation, it is so much more powerful than watching the TV or listening to the radio. That’s why, even though we’re radio guys, we still do live events. It’s harder for us, but it’s more impactful for the audience.
After all, what is the value of just one good idea? Especially when you hear it in an environment where it can really sink in. We can’t promise this event will change your life. But it might. One thing’s for sure. If you’re NOT there, then nothing they say will make a difference for you.
It’s why we make it a point to attend live events and encourage all of our listeners to do the same. We don’t know how many more opportunities you’ll have in your life to see any or all of these three living legends speak live, but they’ll be in San Jose in April. We’re going to be there and we encourage you to be there too!
DONALD TRUMP – ANTHONY ROBBINS – ROBERT KIYOSAKI
LIVE IN SAN JOSE, CALIFORNIA – APRIL 10-12, 2012
Click here to register now!
2/26/12: Fast, Flexible Financing – The Power of Private Lending
When banks are broken, buyers (and sellers!) are frustrated. But tight lending requirements open the door for private lenders, who can be more flexible about the people and properties they’ll lend to.
In this scintillating episode of The Real Estate Guys™ Radio Show, we visit with two real world real estate veterans who are putting private lenders together with out-of-the box borrowers in a market with the cash flows to support it.
- Your powerful yet flexible host, Robert Helms
- Your somewhat private co-host, Russell Gray
- Special guests, all the way from Memphis Tennessee, Alex Craig and Jeremy Veldman
We’re always excited when we get to talk with guys (and gals) who are doing creative things in the market. So when we met Alex Craig in his office in Memphis, we not only invited him to be a part of our market field trip, we asked him to come on the show and share some of the details about how he’s getting deals done in using private money.
What we discovered is that in markets like Memphis, where the prices are low, the rents are relatively high and the cash flows are strong, there’s a lot of interest from people all over the world in acquiring rental properties. Makes sense to us!
What we also learned is that those very strong cash flows attract private investors who are interested in high yields with the headaches of being a landlord.
So how does THAT work?
Alex and Jeremy explain that even though interest rates are low for qualified borrowers, the key word is “qualified”. And in today’s super tight lending environment, there are fewer and fewer borrowers who fit in the box. The folks could be otherwise well-qualified foreigners who simply lack a credit history in the U.S., or have too many conventional loans (“Fannie / Freddie’s out”), but want to keep shopping.
Whatever the reason, there seems to be plenty of demand for unconventional loans. And people are willing to pay a premium to get it when the cash flow is strong enough to support it After all, some leverage is better than no leverage.
For the private lender, they get a much higher yield with a monthly payout. And the loan is secured against an individual property with as much as 50% protective equity and strong cash flow. Sounds like a win-win to us!
So we ask Alex and Jeremy to explain the whole process to us based on their real world experience. We learn a lot and so will you!
Listen Now:
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The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources that help real estate investors succeed.
2/19/12: Lessons Real Estate Investors Can Learn from the Stock Market
Dogs and cats. Labor and Management. Geeks and Suits. Democrats and Republicans.
Do you see the similarity? No? Exactly.
So when someone (whom you’ll meet shortly) suggested that stock market day trading could teach valuable lessons to real estate investors, we said, “Riiiigghht.”
But being the open minded guys we are (remember: your mind is like a parachute – it only works when it’s open!), we decided to jump on a plane (actually, we rode inside) and fly to Salt Lake City.
Barking into the microphones for this episode of The Real Estate Guys™ radio show:
- Your Big Dog host, Robert Helms
- Your hissy co-host, Russell Gray
- Special Guest, Rich Dad Paper Asset Advisor Andy Tanner
One of the reasons The Real Estate Guys™ radio show and podcast exists is because virtually all of the major media and personal finance gurus look at real estate investing as owning a home. When it comes to wealth building, conventional “wisdom” is to buy and hold stocks, then hope and pray they go up over time.
We think real estate is the PERFECT investment (if you overlook tenants and toilets) because you can buy it with mostly the lender’s money, make the payment with the tenant’s income, put the extra cash in your pocket each month (when properly structured), get favorable tax breaks (keep more of your money), AND you’re hedged against inflation over the long term. In fact, you could say that you benefit from inflation over the long term. And even if the value drops, as long as it cash flows, sooner or later it will be paid off (if you’re into owning free and clear rental property). What’s not to like?
Compare this to buy, hold, hope and pray stock investing, where most stocks don’t pay you cash each month. There’s no tax advantages, unless they’re in your tax “advantaged” retirement (you know, the one that trades deferred taxation for converting your low taxed capital gains into highly taxed ordinary income – what a deal!). And, unless you’re into options (which isn’t really buy and hold, it’s trading), you have to purchase your stocks with your own (often AFTER tax) money. Ugh.
So you’re entire bet with most buy and hold stock investing is long term appreciation of the stock price, which is something over which you have NO control. Have you ever tried to put new paint and landscaping on a stock to increase it’s curb appeal?
So, with this admittedly huge bias, we show up with our mobile microphones in Andy’s office. He’s in trouble.
Then we meet Andy. All six feet eight inches of him.
What do you say to a 6′ 8″ guy?
“Um, hello, sir” we say sheepishly as we reach out and watch our hands disappear into his huge paws. “What would YOU like to talk about today?”
Now Andy is one of the nicest guys you’ll ever meet. So before the microphones are on, we have a little back and forth, and before we even do the interview, we’re fans.
We talk technical analysis, fundamental analysis, diversification, cash flow, retirement accounts, the European debt crisis, and the investor’s mindset. We have a GREAT time!
So listen in to the conversation and pull out some precious pearls of paper asset wisdom that you can apply to your own real estate investing. And if you listen all the way through, Andy tells you how you can get exclusive access to his new book, 401kaos. We haven’t read it yet, but we like the title!
Listen Now:
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- Don’t miss an episode of The Real Estate Guys™ radio show! Subscribe to the free podcast!
- Stay connected with The Real Estate Guys™ on Facebook!
The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources that help real estate investors succeed.
Are your social-networking habits effecting your borrowing power?
Unless you’re Donald Trump, you probably need third-party money to close some deals.
As real estate investors, we want to make the most of our borrowing power. But is it possible your social media habits will effect your next loan?
Yes, it is possible.
Rumor has it banks and lenders are gathering intelligence through social media and how they intend to use this information is debatable. Let’s take a deeper look at what is being collected, how it may be used and what you should do about it.
Banks and lenders have always assembled data to determine one’s ability to pay. Traditionally the sources have been credit reports, pay stubs, previous years taxes, bank statements, co-signers and so forth. Now, one’s “social-graph” (online relationships and habits) may have an impact on a lender’s willingness to extend credit.
Does your social media presence reflect financial distress? Do you have friends who are in distress? Are you changing jobs? Moving back home? Buying a new car? Planning a wedding? Taking a dream vacation? Getting divorced?
Your financial situation is greatly reflected in how you live your life. Nowadays, people are sharing their life stories through social media, which is creating a more connected world. But it’s also offering financial institutions (not to mention employers and business associates) a whole new world of insights into things that may not improve your chances of getting that great loan or employment offer.
For legal reasons, the likelihood of an individual’s social sentiment dictating borrowing power is slim. However, word on the street is that banks and lenders will use this information to better direct their marketing efforts. Those with higher social rankings, within their internal system, will get better offerings than those with less favorable profiles.
We have limited this to just banks and lenders; however, this same approach could certainly be applied by potential business partners looking to finance one of your deals. Obviously, as real estate investors, we want the best offerings and here are some tips to preserve your social sentiment.
- Have secure privacy settings
- Be conscience of what you post and how it could be interpreted
- Understand that you are trackable in the digital community
- If you are not paying for a service, then you (that is, your information) are the product
Social media has created a small-town world and allowed meaningful relationships to develop virtually. This is a powerful thing, which means there is potential for both good and evil – so be conscious of how you use and participate in social media.
Remember, EVERYTHING you put on the internet has the potential to be seen by ANYONE and can live FOREVER. As an investor and entrepreneur, it’s essential to be diligent in building and protecting your personal and professional public appearance. Make sure what you’re putting out there consistently presents the public image most advantageous to your investing and business goals.
Staci Davidson is a social media strategist, coach and consultant. For more information, visit www.stacidavidson.com.
