The End is Near ...Sell everything and build a cave

Random Ramblings
21
I also, just like others, am surprised you've done no REI deals over that past year. I am willing to bet that if you got back into this, you could probably flip some nice properties for some great money, rather than holding them.

There is no “getting back into it” - I’m fully in it now. However, I’m no longer in the acquisition phase of my business. I’m simply past that part of the business. I am very happy with the rental business and have no desire to be in the flipping business. As I’ve already said, I had (and have posted) very specific goals when I started this business. I have exceeded those goals and my plans are to simply operate the business I have as the loans are paid off and the equity and cash flow builds.

22

There is no doubt how valuable a guy like Mike is to the cashflow/real estate up and coming investors here…My argument is that I feel we as investors/businessmen/entrepreneurs can do so much more during these kind of times than the bubble decade…Maybe I’m forcing my opinion on others ,maybe Mike is as well…The point of the whole thing is to not be paralyzed by fear…After the banking debacle I saw a loophole in the banking/funding side of things during the worst time in history and put ALOT of capital to work…It turned out to be a great move and a business that I have come to really enjoy…I wouldve never had this opp had we not been in these tragic times…A guy I have done some HML’s for in the past and some RE deals put it correctly when we were having dinner the other night…He said I’m needed now and during the RE bubble times he wasnt needed…He is making more ROI now,more money now,building a real portfolio of properties,buying from sheriff sales etc…You think he is worried what kind of debt the US has,or what BO is doing within our govt…He could care less…All he wants to know if my funding is ready for the next deal…All because of the times we are in…All of this and my HML business would not be nearly as successful if we were not in such bad times…Like I said before these times are when people with money put it to work…I admire the fact that Mike feels he has reached the top of the mountain and is content…Me personally its not a # its I couldnt possibly sit back and see all this oppurtunity pass me buy and not take a shot…But all the same I respect his decision to step back…What I dont agree with is how he is using a real estate forum to spew opinions in how dire the US financial situation is…There are plenty of people making size money out there right now…As we speak…To all the newbies out there I say this…Dont be afraid to get started…If you are young and have time on your side take a shot…The people who make moves in times like this are the ones who sell into the masses when the good times return whenever that may be…Dont be paralyzed by fear…And Mike I say this directly to you,think about how your words influence a young investor…

23

Same here…

DEED IN LIEU…

You want the HOUSE???

You take the deal on MY TERMS…Otherwise…SEE YA!!

I have YET to find a single buyer that passed on a purchase due to this arrangement…They have NO ALTERNATIVES.

NEAT, CLEAN, VERY SAFE for me, and as long as they PAY…They end up with the deed!

My Attorney handles the entire transaction…I even went one step further an set up an LLC as a holding company just for these deals…The BUYERS have no idea I have anything to do with the financing…The payments get sent to the LLC’s PO box just like a mortgage company or big bank, and no one knows any different.

The further you DISTANCE yourself from these transactions the better…Not that you’re doing anything wrong…I just don’t want phone calls from the BUYER with EXCUSES for late payments. DO NOT ATTACH A FACE TO YOUR LOANS…KEEP EVERYTHING SEPARATE!!! If they have a problem, they can deal with my attorney…That’s what I pay him for.

Everyone WINS!!! AS long as they PAY…If they DON’T…They “I” REALLY WIN!!! AS it should be!!!

24
AS it should be!!!

Great model!

-Mike
http://www.youtube.com/watch?v=_BRv9wGf5pk

25

Pete, I am blown away you can find a 300K dollar property for 40K. I can safely say after watching public record transfers for years, that just doesn’t happen in my county. Can you post links to public records for this transaction?

26
I'm not going to be UPSIDE DOWN on ANY of these properties, UNLIKE the IDIOT bankers that loaned people $300,000 on a home which I just paid $40,000 for...(Last WEEK!!)

Nice price point!

I picked one up for $39k in October. Not a flip…but fits in with my plans very nicely.

Heck, the lot, (88 x 220), is easily worth $35k.

Buy 'em when they hate them.

-Mike
http://www.youtube.com/watch?v=SeFiXnEBvBg

27

These are NOT $300,000 houses when I get them…They’re neglected houses that I buy from estates or heirs…NONE of them are ever LISTED on the MLS…N O N E…

I’ll buy a house like that and spend $20K or $30K on it and SELL it for ALL THE MONEY because I AM OFFERING THE FINANCING…

It’s like BUY HERE, PAY HERE cars dealers…They don’t sell at Kelly Blue book…They sell OVER book value because THEY offer the private financing…You can’t be ridiculus, but I can EASILY sell a home for $300K that comps out at $250K. REMEMBER…THERE ARE NO BANKS INVOLVED…NO APPRAISALS…I lay out the terms and the price…They TAKE IT, or LEAVE IT.

Most buyers understand that even at a higher price point than neighborhood comps…They’ll still be OK down the road because housing prices have just been slammed. The house I SELL at $300K NOW…Was sold in 2005 for $500,000.

28

I’m not doubting that you can sell that high that way, I just can’t believe that you can buy a house for 40K up that way! The houses I buy for that price requires a concealed handgun every visit.

If my math is right that is 13 cents on the dollar! No WAY!

Can you post a link to public record transaction for that buy?

29

NO WAY…HUH???

Take a little trip to the CITY OF PROVIDENCE…

Like this one…

www.providenceri.com

Go to the assessors data and look up 226 Vermont Ave…valued at $226,000

Now take a peak at what it’s PENDING for…

http://www.zillow.com/homedetails/226-Vermont-Ave-Providence-RI-02905/65942065_zpid/

$60K!!!

Oh…one more item…

There ain’t a SNOWBALLS chance in HELL that I’m posting an INTERNET LINK to ANY of my properties, which would also link you to my LLC’s, my name, address, ect. Just to satisfy your desire to UNDERSTAND what’s happening here…

This is SIMPLE…You buy a $300,000 house for $40,000 because…

ONE…I’m setting the PRICE based on what I WILL FINANCE someone for…

TWO…It ISN’T a $300,000 house…It’s a $250,000 house (real market value)

Three…You BUY IT for $40K from an IDIOT that had it LEFT TO THEM, OWED NOTHING ON IT, and didn’t want to even CLEAN IT OUT…And SOLD it so he could buy a NEW HARLEY!!!

I actively ADVERTISE for just such MORONS…They read certain papers, they hang in certain circles…I’m not buying a lot of houses from DOCTORS and LAWYERS…I also pay BIG FINDERS FEE’s to these IDIOTS FRIENDS…THOUSAND$!!!

Now how do you think you could CONTACT relatives of DEAD People with FULLY PAID OFF PROPERTIES???

I just showed you a $226,000 house that is PENDING for $60K…You can’t SEE how I could BEAT THAT??? ON a REGULAR basis???

Come on man??? R E A L L Y ???

30

Ok, just can’t believe you can do that up there. Sure wish that was possible here in Raleigh.

31

Fdjake,

I don’t think anyone doubts that you can find deals. That said…

The address you posted… 226 Vermont Ave Providence RI 02905 is listed for $60K

Comes up on Zillow, with a value range of $181 - 250K, with an average of Zestimate of $245K

But on other more accurate sites like Eppraisal.com and Cyberhomes…

Eppraisal - low of $96K to high of $130K, with an average of $113K

Cyberhomes - $118K

At Cyberhomes, the COMPS (within the last 3-4 months) all sold in the $50 - $69K range. One of those was on New York Ave that you listed to check out. You can see them here…

http://www.cyberhomes.com/comparables.aspx?propid=81563449

The reason I am asking this, is I am trying to get a handle on how you are determining value. Zillow is all over the place, so other than knowing the market, and getting a CMA, what other tools do you utilize?

Thanks…

I like the idea of being the banker, but the only challenge I see is, in this market, when people are just walking away from their houses, I’m wondering how many credit-challenged buyers there are that have 20-30% to put down. How are you finding these buyers?

32

You missed something here…

What I said to JOHN was…I’ll never be UPSIDE DOWN in these properties like the BANKERS that loaned someone $300,000 on these houses (in 2005)

They are NO LONGER WORTH $300,000…That’s the POINT of the LINKS…The TAX data is the 2006-07 valuations…Look at what they sell for now!!!

“SO OTHER THAN KNOWING THE MARKET”

There ISN’T anything else…YOU KNOW YOUR MARKET or you LOSE YOUR MONEY!!!

You are 100% correct…The RANGES are ALL OVER THE PLACE.

[b]What ISN’T all over the place is FINANCING!!!

I can show you houses in that neighborhood that recently sold for as little as $10,000…they’re SHELLS…NO HEATING SYSTEMS, NO PLUMBING, NOTHING…

The house I linked IS NOT a property I purchased, or even LOOKED at…It’s an EXAMPLE of how WIDE the price ranges are up here.

AS I’ve said…SOME PEOPLE…are RUNNING away from REAL ESTATE at EXACTLY the time they should be BUYING EVERYTHING THEY CAN…The BEAUTY of those WIDE PRICE RANGES is simple…I can get a price to do what I WANT IT TO…If I’m BUYING, I use the lower end…If I’m SELLING the HIGHER…

I find my end users the same way I find ALL my houses…ADVERTISING!!! EVERYDAY…OVER and OVER and OVER.

Your response is exactly my point…BUYERS looking at these homes see the SAME RANGES you found…EVEN LOWER…The DIFFERENCE is the CONDITION of the homesand FINANCING OPTIONS!!!..SHELLS are dirt cheap because you must be a CASH BUYER, there are NO FINANCING OPTIONS for these properties…Banks won’t go NEAR THEM…AS you move up the CONDITION ladder you move up the PRICE LADDER. I sit at the very TOP of that ladder because I can FINANCE MY PROPERTIES IN HOUSE and I can IMPROVE the CONDITION…I PICK the BUYER, I SET THE TERMS…I want someone with CASH but BAD CREDIT…There are people out there that can pull TENS OF THOUSANDS out of retirement accounts or other sources. They have high incomes but CAN NOT get traditional BANK FINANCING…DIVORCEE"S are a great example…Bad CREDIT because one of them ran up their credit cards prior to leaving…They SPLIT the assets, and someone ends up with a lump of cash but NO CREDIT!!! I actively SEEK these people out…Sometimes they seek ME out…Every deal is DIFFERENT, that’s why I’ll always be involved in this business…It’s NEVER the same thing twice.

Another point here…This is MY way of owning residential units LONG TERM…WITHOUT being a LANDLORD…By financing SOME of my inventory to end users I can make HUGE returns over long periods of time with virtually NO HASSLE. If they WALK AWAY…I ACTUALLY MAKE MORE MONEY!!! I make MORE because I’ve ALREADY received their DOWN PAYMENT, INTEREST, and most importantly…I’M NOT INTO THAT PROPERTY FOR ANYWHERE NEAR WHAT THEY PAID FOR IT!!! That house is MINE…Until it’s FULLY PAID OFF!!

The other thing to remember here is this…I’m not doing 10 of these a month…It’s a OPTION for me if I have a BUYER and a PROPERTY that MATCH UP!!! There are NOT a lot of these buyers out there…But they ARE there…And they DO PURCHASE HOMES THIS WAY. When you can do it…YOU DO IT!!!

For guy’s like POSITIVE who are just starting out investing, there are OPTIONS for him here too…

MOBILE HOMES!!!

IMPOSSIBLE TO FINANCE…As a RESULT…You can buy them for LESS than the price of a USED CAR…If you pay CASH for them…THEN offer owner FINANCING you can win BIG TIME!!! I did this years ago…I would BUY a mobile home for $5000 cash…SELL IT to someone with owner financing for $15,000 with a $5000 deposit…They pay me every month on the $10,000. You set up MUCH shorter pay back intervals on these properties…But…You end up making a KILLING with NONE of your MONEY in the property from the day they purchase…300+++% return with NO CAPITAL OUT LAY (after the buyer’s deposit)

The point here is simple…You DO NOT have to put up with TENANT BULLSH*T if you can be CREATIVE and put some CASH TOGETHER…This is why I STILL FLIP HOMES…It puts consistant 5 and 6 FIGURE deposits in my bank account…Those “soldiers” are then put to work on other “projects” They inturn recruit “NEW SOLDIERS!!!” And on and on!

33

While you may not share Mike’s opinion of the state of the economy, you do have to appreciate that Mike has achieved financial independence and is content to live off his passive income for the rest of his life.

I don’t need the newest and latest gadgets, the biggest house, or the newest car. I don’t need anyone to know how much wealth I have accumulated, and I don’t have to keep up with the “Joneses”.

I understand where he is coming from. I have been financially independent since 1998, and have been "retired’ ever since. I don’t have to do a deal to put food on the table. I don’t need to have a gazillion $ bank account.

34

The point here is this…

IF…IF Mike’s “Planet of the Apes” scenerio comes true…and remember…This guy say’s he’s STOCK PILING…GUNS, AMMO, CANNED FOOD, an not just AMMO…RELOADING SUPPLIES and EQUIPMENT!!

IF his worst case scenerio comes true that “INCOME” he’s living on is GONE!!!

If THAT’S your prediction of our future…WHY wouldn’t you be BUILDING cash as FAST as YOU COULD and transferring that cash build into GOLD or some other HARD ASSETS…OUTSIDE THE USA???

WHY dig a FOX HOLE in “OHIO” and Prepare for WAR with your RELOADING SUPPLIES and CANNED FOOD???

Switzerland rode out WWII UNTOUCHED…Why not move SOME hard assets into GOLD and into THAT banking system?? (Since Mike is constantly telling us how screwed OURS is) Why wouldn’t you be BUYING PROPERTY THERE, he could even rent it to someone, and if your family ever needs a DOOMS DAY BUNKER???..It’s a plane ride away!!! Let me see??? I have a few choices here… A guy that loves to SNOW BOARD and HIKE can stay in the “MOUNTAINOUS REGIONS” of OHIO during the LOOTING, RIOTING and CARNAGE or…ride out the “COLLAPSE” in the SWISS ALPS??? Let me think??? Yea…OK…I’ll take the ALPS with a secure banking system and a FUNCTIONING ECONOMY…I hear the SNOW BOARDING and HIKING are DECENT there too!!! But…then again…with MY PLAN…Your CHILDREN won’t get to experience all the CRIME, the RAPING, and the RIOTING…They’ll miss out on all that “LIFE EXPERIENCE.”

IT DOESN’T ADD UP…THAT’s the POINT…That’s what ROOKIE noticed, that’s what I noticed…Why TELL people you’re living in a country that is DOOMED, FINISHED, BROKE, SEEN IT’S BEST DAYS, and go around buying GUNS and AMMO but do NOTHING to preserve what you spent a LIFE TIME building???

If Mike’s country wide RIOT/REVOLUTION scenerio comes true, I seriously DOUBT his RENT checks will continue to come in…It’s ridiculus…Come on…We’re gonna have a complete financial COLLAPSE & REVOLUTION but Mike’s TENANTS, who are all LOSER/DEAD BEATS, are gonna keep PAYING him??? Or maybe the GOVERMENT that Mike tells us is BROKE and headed for COLLAPSE will make sure his Section 8 checks keep coming…DURING THE REVOLUTION!!!

COME ON…WAKE UP…

You’re looking at a time when there is opportunity EVERYWHERE…If you think this country is DOOMED…GREAT…Start SELLING those rentals and put your money where your MOUTH is…SHUT UP…GET OUT…MOVE…

Transfer your assets…DO SOMETHING…Don’t tell me about stock piling guns and ammo and canned goods…It’s freakin JOKE!

Here’s a guy that tells us he works 12 HOURS A WEEK…The Country is going to COLLAPSE, and he didn’t buy or sell a SINGLE house in 2009 because he’s… HAPPY!!!

WHY…WHY…WHY…doesn’t he really PLAN for HIS predicted upcoming TOTAL COLLAPSE of the USA???
Keep your RENTALS…(in case you’re WRONG)… But Flip as many houses as possible in 2009 and PLOW every PENNY into GOLD and a SWISS Bank account!!!..Buy a small Villa in the Alps…Rent it…REALLY protect yourself and your FAMILY…Not some BULLSH*T RAMBO idea of PROTECTION…with GUNS, AMMO stock piles and CANNED GOODS.

If I REALLY thougth a total collapse was coming…I’d want to know my family was SAFE…I had PROTECTED my assets… and I had LIQUID capital and thus…OPTIONS!!!

Stock piling AMMO and canned goods for what MIKE says is coming is like hoarding CARDBOARD for HURRICANE season.

35
It's a plane ride away

Brian Regan on that:

http://www.youtube.com/watch?v=G9em-ZCddWk

-Mike

36

IT DOESN’T ADD UP…THAT’s the POINT…That’s what ROOKIE noticed, that’s what I noticed…Why TELL people you’re living in a country that is DOOMED, FINISHED, BROKE, SEEN IT’S BEST DAYS, and go around buying GUNS and AMMO but do NOTHING to preserve what you spent a LIFE TIME building???

Absolutely…It made zero sense to me and thats why I started this thread in the first place…What makes Mike feel like his tenants that are deadbeats already will survive a full govermental meltdown…If this country goes broke him and his tenants will go with it…Thats why to anyone with a half a brain his posts make zero sense…He is more exposed than anyone but the kool aid crowd cant see that…Had he gone to an all cash position in 2007 (when real estate fetched a pretty penny) I wouldve thought this guy is serious…I like the guy but he is not thinking correctly when it comes to management of his personal assets…

37

back to fdjake’s babysitting comment…

it’s got too many roofs…too many toilets…that’ll certainly 'cause one to plateau.

but…it IS generating decent cash…not great, but decent.

I know Mike…he’s greedy…just as we all are…well at least I know I am.

if I were Mike, I’d keep things intact but at the same time diversify into something else that’s even more lucrative but with far less headaches.

in fact, he’s probably already at it.

-Mike

38

Here’s my PREDICTION!!!

READY???

SIT DOWN and LISTEN carefully…

Mike…and the UNITED STATES OF AMERICA…PROSPER!!!

NO BUST

NO COLLAPSE

NO RIOTS

NO REVOLUTION

NOT A SINGLE SHOT FIRED BY MIKE in ANGER…

Mike eventually enters a WEIGHT LOSS CLINIC because he EATS his way through 5 YEARS OF CANNED FOOD SUPPLIES stored in his ammo dump.

After slimming down, Mike does what ALL SEASONED, WEATHERED, SMART, SUCCESSFUL Real Estate investors do…

HE UNLOADS EVERY SINGLE ONE of his residential rentals and buys COMMERCIAL PROPERTY…
He does this shortly after buying his FIRST commercial property…When he discovers that if a COMMERCIAL TENANT doesn’t PAY…HE’S GONE…BYE BYE, NO EVICTION PROCESS…NO SHERIFF’s…The LOCKS are changed, and the sign goes up! FOR LEASE.

THEN…and ONLY THEN…Will we read POSTS from MIKE about what a GREAT COUNTRY HE LIVES IN because at that point he won’t be dealing with the SCUM OF THE EARTH on a DAILY BASIS!!!

39

I’ve got to tell you, I don’t know how anyone with an ounce of common sense could think the USA is getting ready for a boom and is going to prosper. To me, that sounds DELUSIONAL! Neither of you have answered the questions I asked earlier - BECAUSE YOU DON’T HAVE AN ANSWER! There IS NOT AN ANSWER!

Look at what happened just today. The President says he’s going to tax the banks, which he claims are now profitable. Here’s a newsflash - THE BANKS ARE NOT PROFITABLE! The banks HAVE STOLEN wealth from the middle class via the biggest scam in history. ANYONE WITH AN OUNCE OF FINANCIAL UNDERSTANDING SHOULD BE ABLE TO UNDERSTAND THAT! The FED GAVE (are giving) the banks money at zero percent interest and then the government paid them 3% for that same money. It’s a shell game and the taxpayer is holding the bag. If the government gave me the same deal, I would be a billionaire or trillionaire today. No risk. No possibility of failure. IT’S A SCAM! By putting a TAX on the banks, that tax is really going to the taxpayer who will ultimately be stuck with fees or higher interest rates on their banking to pay that tax. IT’S A SCAM! (If either of you disagree - explain it to us). Rookie said that he’s a capitalist and a conservative - THIS SHOULD MAKE YOU FURIOUS! This is nothing but socialism - the government is essentially controlling the banking industry and a lot of the rest of the economy.

I’m all for making money. I’m all for you guys doing whatever you want to make money. However, how about thinking for one minute about something other than yourselves and think what this socialistic transformation is going to do for your kids and grandkids. This country has been a great country because we were free and because we were a capitalistic society. That is RAPIDLY disappearing. The government will soon control another 1/6 of the economy by taking over the healthcare industry. They already have the banking industry. They have a big part of the auto industry. They want to dictate how much energy you use. They want to take YOUR money and give it to those that are too lazy to work. Start thinking about someone other than yourself and be concerned about the future of this country!

Look what else happened today. The president is going to put a tax on Cadillac insurance plans BUT EXEMPTING THE UNIONS! So, two people living side by side; working in the same industry; making exactly the same money; with exactly the same insurance will be taxed differently. For what reason? CONTROL! It’s pitting one American against another. That’s an outrage and the American people are getting sick of it. This is NOTHING BUT SOCIALISM and it’s about time that we take the country back. When I say “take the country back”, I’m not talking about voting out the dems and voting in the republicans - THEY’RE ALL A BUNCH OF SCUM! We need a new party and a new country that gets back to the principles that this country was founded upon.

As for your ignorant suggestion that I might want to get out of the country because it is going to fail - I’m not suprised that you would suggest that and I’m sure that you and Rookie might just do that. However, I am not leaving this country. THIS IS MY COUNTRY! I am staying to be part of the this country when the people finally decide to take this country back. The socialists can get the hell out!

Finally, I’m not some newbie that believes your nonsense about the self-storage business or holding notes or whatever else you’ve got going. I have owned several businesses and I know that EVERY BUSINESS has it’s frustrations and that no business is easy. So, do me a favor, and save that crap for some newbie you’re trying to impress! Yes, the rental business can be ugly and so is every other business. If owning self-storage or holding notes was easy - EVERYONE WOULD BE DOING IT!

The only good thing about this thread is that it’s all documented. It will be very easy to tell who was right and who was wrong.

40

AHHHHH YES!!!

JOHN WAYNE!!!

“I’m gonna STAY AND FIGHT!!!”

For WHO Mike???

All the SCUM BAG POLITICIANS???

Or are you fighting for all the DEAD BEAT LOSER TENANTS you’re always telling us about???

Or is it the 50% of Americans that don’t work and are on disability that you’ll lead the charge for???

Or maybe you can stay and FIGHT for those UNION SLACKERS you hate so much???

SELL IT SOMEWHERE ELSE MAN!!!

You say ONE THING…Then HOLD OUT YOUR hand for SECTION 8 CHECKS every month…

U N B E L I E V A B L E!!

You’re gonna ride the GOVERMENT BACKED, SECTION 8 rent check, Bank bail out, Auto company rescue, Health care company backed, GOVERMENT T*T…Just like you have since you received your first SECTION 8 RENT CHECK!!

BULLSH*T someone else Mike. PLEASE

I’ll let all the PATRIOTS here worry about OBAMA and SOCIALISM…YOU can continue to collect your SECTION 8 rent checks while working 12 hours a week, SNOW BOARDING, HIKING and Riding your Motorcycle!!!

Looks a little different my MY VIEW MICHAEL…From MY VIEW…YOU are a SOCIALIST!!! You DIRECTLY benefit from HUGE Goverment backed programs that “I” pay for…I have NEVER received a section 8 rent check in my life…EVER…YOU FEED YOUR FAMILY WITH THEM!!!

Go BS some NEW GUY with your PATRIOT stories!