50 Reasons Investors FAIL or lose $$$$

How about: Never getting started in the first place because they think they need a 700 credit score and down payments to buy houses. That is the typical mindset of most people when they first want to get started in RE...and the feeling of needing to have EVERYTHING set up before they begin. Like they think they have to have a top notch website, and business cards, and an office, etc...that's how I felt before I began, and all I had was a cheap $9 a month website and I did my first deal. Now of course I have the business cards, etc...but you don't need all that fancy stuff to get started. Heck, I didn't even have my own computer when I started. I would go to the library EVERY day to do research and send emails etc...those were the days!!!

The more I do the more I move away from that conventional lending and realtor think! The more business I do the less I use my selling websites. The big time REIs that I know do not face book, twitter or whatever. They don't have websites either. They are out trying to acquire properties and execute their exit strategy and that is ALL they do.

Michael

I love all these posts on this thread. This subject means a lot to me.
Keep this in mind as you are moving forward as a business owner / real estate investor.
Winners actually fail more than Losers fail.....
Winners fail and try again, and again, and again.
Losers Fail, and QUIT.
Winners fail 10,000 times until they finally invent the electric light bulb (Thomas Edison)
Winners lose 5 political elections before being elected President of The United States (President Lincoln)
Winners miss 51% of the shots that they took in their NBA Career (Michael Jordan)
Winners fail 65% of the time when they step up to the plate to bat. (Babe Ruth)

Michael Jordan was quoted as saying "I've failed over, and over, and over again in my life,,,, and that's why I succeed".
Believe it or not, Michael Jordan missed 26 game winning shots in his career. How many people out there would be willing to shoulder that kind of burden so many times?

Keep this in mind as you are investing in real estate.

It's not the "early bird that gets the worm", but instead "the persistent bird who gets the worm"

Work hard, and you'll see results.

Happy Investing.

Matt W.

Michael,

I think #1 wraps up everything for me. I was taking some action trying to be perfect "before" the deal so I would hopefully know everything when asked a question. I was telling myself that I WAS taking action, but that was just an excuse not to call people or send out those postcards.

Now, that I am knee deep in this real estate investing stuff, sending out postcards, putting out bandit signs, making calls, running comps, etc is just part of my daily routine. Now, I just learn from my mistakes so I want hopefully make the same mistake twice.

For people like me who think they have to be perfect to succeed - STOP thinking so much and as so many have said - TAKE ACTION!!!

Thanks for the post Michael - you hit the nail on the head. Hopefully, it will inspire others to not quit and keep moving forward.

#24 you didnt LEARN enough about REI b4 you went out and looked like a fool and quit

#25 forgot what you thought you learned

#26 overwhelmed and QUIT

#27 just looked at prices and numbers and thougt you knew what you were doing and mad lowball offers if any at all

#28 didnt have buyers list

#29 did not know how to match strategies/techniques with seller/property situation

#30 tried to learn EVERYTHING about REI and quit or never got started ...yet.
Just choose ONE, learn about that ONE to get started and make some deals, THEN broaden your knowledge with more

#31 "I read 2 books and still dont know where to start". Great - you have to STUDY REI. Study it until you KNOW it like the songs you've memorized!!

#32 I saw this guy do this and when I tried it didnt work

#33 "I'm getting SUED by the seller for non performance", = Lack of Knowledge and is very sad and could have been prevented

There are NO accidents, just lack of attention

Everyone should print this list of reasons and have them where they can see them while doing deals. It is so important that each investors take these things into consideration and most importantly read and listen to Dean. He teaches principles to help people avoid these problems and find success! thank you for sharing!

Thanks Mike.

Michael

#1... Being afraid of FAILURE! The only thing you should be afraid of is REGRET and NOT doing enough to achieve your goals. If you aren't failing often, you aren't trying hard enough! When is the last time you failed?
#2....Not setting goals; clear concise goals, how you'll feel if you MEET them, how you'll feel if you DON'T meet them, with dates and times you're going to achieve them.
#3....Not getting your mindset right! People come into this thinking they are going to be handed money without doing work, they will never make it!
#4....Listening to naysayers and people that have NO clue about real estate. NEVER let other people determine your success for you! You are in control of your destiny, NO ONE ELSE (except God!)

I didn't read the whole thread, only the first page; hope I didn't replicate any!

# ? "I dont have time"

My ? has always been, "since we ALL have 24hrs a day, how are YOU wasting yours?"

you seem to find time to make excuses

Ok, I added yours for a total of 38 reasons why new investors fail. I know we can make 50! Keep them coming guys.

Thanks!

Michael

I dont know why people think they have to curse in order to get their point across. thats just plain out rude and disrespectful.

38. They don't find out what they don't know
39. They're too tired or have a headache or have "doing nothing" on their to do list
40. They try to get to "Doing a Deal" before they devise a strategy or gather the A.B,C's
41. They sweat the small stuff
42. They don't turn their Dreams into Goals
43. They don't turn their goals into tasks
44. They don't turn their tasks into manageable baby steps
45. They don't step off the curb
46. They fear-- everything. There is NOTHING to lose here, but a little sleep or "TV" time-- NOTHING!

okay, someone take it to 50!

Thanks Michael, et al.

Sorry, being a hog here, but had to add this....
47. They don't DRIVE AROUND and SEE the neighborhoods for themselves, AND find out where the Investors are buying--

Broken Focus

The battle of the mind is for focus. We all kind of struggle with this!

Nice useful thread really, Thanks Mike and everyone - we can all use these tips!

Cris

Thank you Michael and all for this post. I WAS wide eyed when I started compiling all the Reasons that came in, but it's a work in progress.

Not quite to 50, yet. Need at least 1 more.

Michael, please combine and condense as you see fit. I left the integrity of each post I copy/pasted, with little license taken, however I did sum-up some of the thoughts.

Drum roll, please...

1. They never take action.
a) “The only real failure in life is the failure to try.”
b) Never getting started in the first place because they think they need a 700 credit score and down payments to buy houses.

2. They don't know and understand market numbers. Neighborhood by neighborhood supply and average DOM analysis.

3. They have inaccurate repair estimates.

4. They do not determine an accurate ARV. They use Zillow, Truila, e-appraisal or an average of all three! CMAs are a must.
a) Investing in property below sea level.

5. They use bad contracts.

6. They have no real marketing plan. They rely on agents only. There are not enough good deals on the MLS to make a living.

7. They have no WRITTEN over all business plan. No written plan is a plan to fail!

a) Not planning and executing mindful growth of their RE Business [Blowing the 1st thousand, $10K, $100K a noob makes on crap they don't need, instead of paying off debts, improving their credit, and re-investing in their business and education.]

b) Not building a team and utilizing experts. [Trying to shortcut the process and make/save $$ by pretending to be someone they're not. Examples: "I've got a toilet in my house, how hard can plumbing be?", investors trying to be banks, REA's pretending to be lawyers and misquoting the laws to the point of committing FRAUD, REI vets pontificating from their ivory towers of experience trying to be gurus, investors expecting their title company to do their lawyer's job and vice versa, etc., etc. You guys get the point.]

c) Doing anything blind - meaning without any due diligence and without a clearly defined goal in mind beforehand.

8. They get severely stuck in over analysis paralysis! They must know everything and FEAR failing.

9. When they do their first fix/flip they choose the wrong contractor and let the contractor control the project. FATAL mistake!

10. They choose the wrong legal entity. LLC? C or S corp? They do not consult a tax professional before choosing.

11. When they first start talking to people they have no idea what to say. How to converse with a distressed home owner is not the same way you work with an agent on an REO acquisition.

a) Being too scared of what they're saying to say it with a straight face. "I'm not a lawyer, so don't sue me for saying (fill in the blank)."

b) Not listening to the buyer/seller-- putting the focus on them takes to fear out of intimidating conversations

12. They rely on and try to find one agent only.

13. They do a couple of deals then become arrogant and think they know everything.

14. Using weasel clauses when submitting offers. You WILL be guaranteed no bad deals. Why? No offers will be accepted 99% of the time!! Use the inspection period only.

15. Reading too much into some of these posts and believing it is impossible and giving up!

16. Not being professional. [Just goes to show you, don't curse, it's not and people take you less or seriously.]

17. Not handling their contacts efficiently and backing up. [Some people are just dumb enough to lose their phones and lose all their buyers contacts...Like me! lol.....]

18) Believing someone when they tell you "you can't do (fill in the blank)."

a) Believing every negative thing they hear, then growing it into a tidal wave of doom and dread that keeps them scared on the couch.

19) Losing that Contrarian mindset. Or even worse, not even knowing what that is.

20) Not learning enough about REI before you went out and looked like a fool and quit

21) forgot what you thought you learned

22) overwhelmed and QUIT

23) just looked at prices and numbers and thought you knew what you were doing and made lowball offers if any at all

24) didn't have a buyers list

25) did not know how to match strategies/techniques with seller/property situation

26) tried to learn EVERYTHING about REI and quit or never got started ...yet.
Just choose ONE, learn about that ONE to get started and make some deals, THEN broaden your knowledge with more

27) "I read 2 books and still don't know where to start". Great - you have to STUDY REI. Study it until you KNOW it like the songs you've memorized!!

28) I saw this guy do this and when I tried it didn't work

29) "I'm getting SUED by the seller for non performance", = Lack of Knowledge and is very sad and could have been prevented

30)... Being afraid of FAILURE! The only thing you should be afraid of is REGRET and NOT doing enough to achieve your goals. If you aren't failing often, you aren't trying hard enough! When is the last time you failed?

31)....Not setting goals; clear concise goals, how you'll feel if you MEET them, how you'll feel if you DON'T meet them, with dates and times you're going to achieve them.

32)....Not getting your mindset right! People come into this thinking they are going to be handed money without doing work, they will never make it!

33)....Listening to naysayers and people that have NO clue about real estate. NEVER let other people determine your success for you! You are in control of your destiny, NO ONE ELSE (except God!)

34) "I don't have time"

35. They don't find out what they don't know
36. They're too tired or have a headache or have "doing nothing" on their to do list
37. They try to get to "Doing a Deal" before they devise a strategy or gather the A.B,C's
38. They sweat the small stuff
39. They don't turn their Dreams into Goals
40. They don't turn their goals into tasks
41. They don't turn their tasks into manageable baby steps
42. They don't step off the curb
43. They fear-- everything.
44. They think there is something to lose. There is NOTHING to lose here, but a little sleep or "TV" time-- NOTHING!
45. They don't DRIVE AROUND and SEE the neighborhoods for themselves
46. They neglect to LISTEN to their buyers (or sellers) to optimize success
47. The battle of the mind is for focus. We all kind of struggle with this!
48. They don't place an offer!
49. They get stuck on a particular "how to" and neglect to step back and take a common sense overview of the deal-- it's only a deal if some one will buy it, rent, etc.... By the book, is not for every situation.

Happy Spring!

I would like first of all to thank Micheal for starting the REASONS "Project"

Second, I would like to ask about reason #4 regarding getting CMA's for properties. Where else can you get it except from realtors. If you are not working with a realtor right now, how can you get a Comparative marketing analysis (I assume that is what CMA means). Right after I read about the reasons, and I read all the thoughts about it, I went to google to see if there is a way to get cma without a realtor. I was able to get some information from Keller William website. Are these figures reliable enough.

Thirdly, and I am asking for your imput. I recently placed an ad in Craigslist, seeking realtors to work with. I got some responses. But I am not sure what to tell them as to the question of money (earnest money)and whether or not to tell them about possibilities of flipping or not flipping, or wholesale or not wholesaling, etc. Any help will greatly be appreciated. Meanwhile I am researching what information is available on this DG site to refresh my memory of what needed to be done. I believe I need a RE agent even though I have done a number of bandit signs and have been getting some responses.

Thanks again Micheal.

Matthew

Hi Matthew,

You asked about Michael's #4-- "Where else can you get it except from realtors?"

In #4. "They do not determine an accurate ARV. They use Zillow, Truila, e-appraisal or an average of all three! CMAs are a must."

Michael is saying the Comp needs to come from a Realtor, the MLS, and I will add Public Information that YOU can get if your county has a good website. He is saying that the Zillow, Trulia, etc. sites do not give us reliable, accurate, true comps-- they are robot acquired and may include errors.

I have found that MLS (Realtor) comps, as well as comps a Title Co. may supply as well are the most accurate done two ways-- alike properties in a 1/2 mile (sometimes a mile) radius AND by subdivision. Just a note, I look at the comps differently when I am buying and when I am selling or putting together a prospectus. I use the most conservative ones when buying and the more desirable comps when I'm selling, afterall each investor should go over the comps themselves.

As for your next question, re: Real Estate Agents- "I am not sure what to tell them as to the question of money (earnest money)and whether or not to tell them about possibilities of flipping or not flipping, or wholesale or not wholesaling, etc."

There are many, many threads on this site on the subject of Finding a Real Estate Agent to build your Power Team. I'll bring a New Thread to the top for you....
but will answer the EMD question--- don't worry about the Earnest Money subject when you first talk to agents-- it's a negotiable item and something you'll discuss with the agent when you begin writing offers.

I am Brand new to investing. I have a LONG way to go, and this list will be helpful. Thank you Michael and everyone else who commented. I know I will probably fall victim to #8 a few times, but I have invested in the academy and plan on following their advice to the T. I am reading Dean's books and trying to take notes. I have people in mind to start building my power team list (REA's, other investors, mortgage brokers) and I have even got an REI club I can go to. I started going to it a few years ago when I thought I was gonna start. Now that I found Dean, I KNOW I'm gonna start.

So thanks again Michael. The list was the first thread on this website that I visited. The information will be very useful.

Hopefully I'll talk to everyone more often. I dont know when my first deal will be, but hopefully soon and hopefully it will be positive.

-Dawna (newbie)

That is so true!!

Bumping it up!

Hey guys,
Here's one I need to work on.

I try to answer all my calls, but I have been inundated (and spending way too much on the site, here) for over a month or so with calls from my signs and ads.

I have not gone the route of DG with recorded messages and 800 #'s and relays.

Please advise, share recommendations.

I think not promptly repsonding to calls is a BIG failure item!

Thank you Michael M for starting this thread and all the others who enhanced it. Great, great stuff!

Linda

As great as this site is, that's no excuse for not answering calls! Heck, if I did that, I would've lost about 4 cash buyers & a contractor. The site is secondary not primary.
If you have calls going straight to your phone, clear the recent calls every morning so you can see the calls you missed and return them as the day goes on.
Out of maybe 8 missed calls, I failed to contact 1. The other 7 appreciated me calling back and were more than willing to talk business. Do not be scared folks! You're leaving money on the table by not calling back missed calls.
800 #s are not a necessity, and I, in my opinion, think expecting people to leave a message is just as bad as having a missed call you don't call back. To me, an 800 feels corporate. I want people to feel like they will get a live person at the other end.
If you have been inundated will calls for a month, maybe you should ramp down the advertising so you can catch up/keep pace. Better yet, find a friend or intern that will help you out.
Google Voice is great for a lot of things. It keeps track of all your missed calls, with time, date and location. It also can be forwarded to any phone you choose. So if you have somebody answering phones for you, have it forwarded to their phone and they can do it from home.
Okay, that's my 2 cents, keep the change

The list of why investors fail could go over 50 I am sure.

The reasons investors are successful is a very short list I believe. Here are the 3 main attributes that ALL successful business people and entrepreneurs share.

1. Determination
2. Persistence
3. Creativity

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

Great post Michael! Makes you realize what I need to change in order to succeed!

Great post Michael! Makes me realize what I need to change in order to succeed!

Break your neck trying to answer ALL calls!!
Return missed call quickly
Be prepared and have all forms needed close by to gather the needed info

HERE......

I'm too tired

don't have time

don't want to this any more

I have to watch TV show/game etc

I CAN'T

Either way YOU made a choice