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5/12/13: No Financial Limits – The Keys to Raising Capital

What do you do when you have more deals coming across your desk than you have money in your checkbook?

Well, some people look for ways to increase their income and decrease their expenses (both good ideas) in order to save up enough money to do the next deal.  But unless you have superstar earning power or an overly lavish lifestyle, you’ll probably find that saving money to get to the next deal is pretty slow sledding.

So what’s an investor to do? That’s the topic of this episode of The Real Estate Guys™ radio show!

Steering the conversing on the compelling keys to corralling capital:

  • Your 5 gallon (beer mug, not hat) host, Robert Helms
  • Your pint sized co-host, Russell Gray

So if you’re looking at your financials and saying, “Where’s the beef?” it might be time to think about rustling up some OPM (Other People’s Money).   And coveting your neighbor’s capital doesn’t necessarily make you a contestant for a future episode of American Greed.  Quite the contrary!

Right now, savers are getting killed by the artificially low interest rates designed to re-inflate asset values.  And if you look at the stock market and rising housing prices, you’d have to say it’s working.  At least as long as Helicopter Ben keeps the printing presses rolling.

But we digress.

Savers lose when interest rates are low and prices are rising.  Essentially, they money that isn’t working for them.  In fact, in most cases, prices are rising at a greater rate than savers are earning in interest, so savers are falling behind.  Naturally, this forces savers to put money into the stock market…or other investment vehicles they hope are likely to rise along with or faster than inflation.

That’s great for you as a real estate investor.  Because the right real estate can provide a combination of income, tax breaks, equity build up and an inflation hedge all at once!  But you probably already know that.  That’s why you don’t have any cash left.

But savers don’t think like you do, and even if they did, they don’t want to get their hands dirty,  so if you’re willing to hustle (in a good way), you can help savers while helping yourself.  And it doesn’t mean you have to have partners.  You can set up limited partners, or just borrow money privately.  Many people don’t know they can use their rollover 401ks and Individual Retirement Accounts to make loans to private parties…like you.

Then there’s the banks.  Every depositor’s savings is a liability to the bank.  So banks need to create an asset (a loan to someone) to offset the liabiity.  And in spite of all it’s issues, real estate is still a preferred form of collateral.  So banks actually are looking to make good real estate loans.  Loosening guidelines and rising prices seem to verify this.

The point is that there are lots of resources out there.  And there are lots of deals.  That means there’s lots of opportunity for resourceful investors like you to use OPM, whether you borrow it, or find partners.

Best of all, when you help move capital to where it can do the most good, you’re playing an important role in the healing of the economy.  That’s not greedy, it’s good.  So…(ready?) go ahead and milk the situation.

Tune in to this episode and get ready to raise your sights (and some capital!) and take your investing to a whole new level!

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