All Forum Posts by: Sherman Ragland

We have a program called The 21 Day Quick Start Challenge.  It costs $19.97, goes for 21 days, and includes 2, two hour mentoring sessions each week during the 3 week program.  It has a 4.7 Rating on Trustpilot with 47 people making the time to rate it.  You can access it by Googling “21 Day Quick Start Challenge”, Sherman Ragland.  The best way to evaluate someone is to invest your time and energy with their time and energy for a short period and see for yourself if it is a good fit.

what service are you guys using to post tents payment history to the credit bureaus? 

Bought a few properties, over the years, on Hubzu.

Be sure to calculate ALL of their fees when submitting your bid, and don’t get “auction fever”.  

Also, very difficult to flip a deal with the (strict) timelines they impose, but if it’s a fix and flip, or buy/hold deal, it’s a good resource.

MLS, however, is still going to be your most consistent place to find deals.

@Calvin Williams yes we do. Nothing scheduled during the summer, but you can reach out to Lisa and she’ll let you know what’s planned for Fall.  http://www.NeedHelpAskLisa.com

Private investors are (by definition) private, or Hard Money Lenders (HML), meaning they are not in the business of lending money. As such, you should not compensate them the same way you would a HML. Most private investors are cultivated through relationship building and unlike HMLs, they are not prepared to step in should you screw up. They are primarily investing in you first, and the deal second. Totally (180 degrees) opposite what a HML does. As such, their compensation should be in line with any other "passive" investment they are used to getting. If they customarily invest in 1-2 year bank CD's they're used to 2-3%. If they're in Mutual Funds, 6-8%. If they are an active stock market investor, they know how to command 10-12%. I'd start with what they are used to, then get them to "beat you up" to another 150-200 basis points (1-2%).

@Jeffrey Mcintyre - Thx!

@Calus Glispie it’s not a “Myth”, but I think you’re asking the wrong question and as a result getting some seriously “bad answers”.

Technically, you can offer “anything of value” as consideration to ratify your contracts.

A dollar, a promissory note (which is a glorified IOU), a promise to perform in the future, $1,000.00, $10,000.00 even a million are all considered valid forms of consideration and could be used as Earnest Money Deposits (EMDs).

...but the first two questions you need to ask (and answer) are:

A) How badly do I want this deal and, (more importantly);

B) How do I make sure I don't lose my EMD, whatever it is.

A) If you really want the deal, you need to show you’re serous, as most people have said in their responses).  While a dollar can work, it usually demonstrates that you are randomly sending out hundreds of offers (usually sight unseen) and do not really care if it’s a yes or no.  You’re playing the volume game.  If that’s what you’re doing (and it’s working), keep doing it.  But if you really want a specific deal, step it up. Offer above what would be considered “normal” to get the other sides  attention!  If $1,000.00 is “normal”, offer $5,000.00!

B) More important than what you offer, how do you make sure you (never) lose it. This is the part no one is talking about and they should. If I know for a fact that my EMD will NEVER be lost, then I can offer $5,000.00 to $10,000 EMD all day long, and probably beat any competitor on a close deal.

Here's how you protect your EMD...

#1 NEVER let your EMD leave "Friendly Hands". I could care less what the MLS or Seller says, I put my EMD in the hands of my Broker, or my attorney. Never in the Hands of the Title Company (They're Neutral) AND CERTAINLY NEVER in the hands of the Seller, or the Seller's Attorney our Agent (They are the Enemy). Any money you give to the Seller, or Titke Company you should consider as "lost" the second you give it to them, regardless of what the contract says. If you're ok with this, then you should stick to offereing $1.00 for your EMD;

2) Cobsider using "Promossory Notes". This will probably not work for deals in the MLS, but it works frequently for commercial, land and residential FSBOs. Promissory Notes are easier and cheaper than giving up cash. I don't advocate being dishonest, so understand that a Promissory Note is a promise to pay, but to actually get paid they'd have to take you to court. Some gurus say you'll never have to honor a Promissory Note, but that's only if you're dishonest;

3) Regardless of your form of EMD (Cash, Cashiers Check, Promissory Note, etc) make sure you have at least one good "weasel clause" in your contract that Gurantees you can legally (and ethically) can walk away. Get one in their that is good up until the minute of Settlement. If you can't, be sure to know what your deadlines are and walk (if you need to) before your EMD goes at risk. As an example I always (freaquently) use "Subject To The Approval of my Hard Money Lender". I use this even if I'm not using a Hard Money Lender for the deal. The way it's written, it's open ended and I can get him to fax me a rejection notice at the Settlement Table. If for some reason the Seller gets me to agree to modify it to say "Up until 12:30 AM on XYZ date..." then I better be prepared to lose my EMD at 12:31 AM if I don't exercise my weasel clause by 12:30 on that day and somethings goes wrong later.

Even if my EMD is in friendly hands, if I screw up and don't have a good weasel clause, eventually the Sellers can sue (and probably win) to get my EMD turned over to them.

@Quintin Gulley Jr, an LLC (or L.L.C.) is a Limited Liability Company. It is formed at the state level and by having one, you can do business in that state through an entity. If you choose to do business in a state without an entity, such as an LLC C-Corp, or Limited Partnership,then you're doing business as a sole proprietor and are given no (legal) protections if something goes wrong.

Because LLCs are regulated at the state level, every state is different. First place to check is with your state agency that regulates business activity. Same place you file paperwork to form a corporation is usually where you get the forms and instructions to create an LLC. 3) Again, the formation of your LLC is at the state level. Some states allow you to do this online by filling in the blanks. Some states provide a (pdf) downloadable form and instructions, and some states give you zero help and require you go get a lawyer. Check with your state first, before paying for a bunch of forms at Legalzoom, etc, because you may not need to incur this added expense.

Here’s a couple of things to keep in mind:

1) You (generally) do not want to do business as a sole proprietor. Forming (either) an LLC, or C-Corp will give you protections you don't get as an "unincorporated" person doing business;

2) Forming your entity (LLC, or C-Corp) is just the first step. After you form it at the state agency you'll need to get an EIN number from the IRS (you can do this online at IRS.gov) to be able to open and bank account. When you request the EIN, you'll also need to decide how you want your entity to be taxed. Best to discuss this issue with a CPA. However, my opinion (not a lawyer) is don't spend too much time thinking it over. Just get the paperwork done, start making money, and from the money you make go get (better) accounting and legal advice to change what you've already done.

Most important thing when getting started is just get it done.

@Tj Hock - Unfortunately, the MLS is not a viable substitute for Loopnet. Even in it's diminishing state, Loopnet still has more commercial listings than you will find in the MLS. Also, the parent company of Loopnet continues to use the court system to kill off any legitimate competitors.

Loopnet was a great place to find deals, until...

They got a new owner a few years back.  Every day it appears that the acquisition was really to kill Loopnet, not improve it.