The Journal of the Daily Adventures of Indiana-Joe

The weather is getting a little colder each day and the forecasts are now including those words we did not want to hear..."chance of snow with an accumulation." The day started a little chilly and by the night time it was even cold and very windy. Chicago is known as the "Windy City". The reason this nickname was coined years ago were some people felt some of the politicians would often boast too much and were "full of hot air". However, as you walk down Wacker Drive and the ice cold wind comes off the Chicago River and Lake Michigan on a brisk cold day; as your face hurts from the cutting wind and feels as though your skin is being peeled off your bone faster than a sharp potatoe peeler, you might argue the basis of the nickname. The winter always has the shortest amount of daylight where it is usually dark and night time between 4:00 PM and 4:30 PM. This can make it dark when you go into work and dark when you come home. You begin to miss the sunshine a little.

I called and spoke to a few new mortgage brokers. As in any profession, some are more knowledgable than others. The loan programs and qualification can change every few months so it is always a good idea to stay on top of the requirements, incentives and what types of programs are out there. A few calls can catch you up quickly as brokers are always interested in new business.

There are several homes that I have on my radar that are under $50k. They need some work but these homes just a little over a year ago were over $100k and the community they are in still has the average home around $90k+. It comes down to figuring out the best exit strategy based on the opportunity. I will run some numbers this weekend and I may make an offer or two. You can make offers a little lower than you normally might when there are an abundance of homes in the similar price range that you are looking at.

I hope everyone has a great week ahead. Be sure to stay updated on what new listings are in your target market area and feel free to make some "agressively" (low) offers. One key to remember is you can always increase your "offer price" with a future higher offer. Good luck on your future real estate deals. Believe and Achieve! - Joe

Thank you so much! Your advice is so helpful. I'm putting together the final touches on my email this morning and will keep you posted when it is all said and done.

Thanks!
Louisa

Can we still claim a tax credit if we owner finance or would the house have to financed by a bank or lender to get the tax rebate? Thanks.

Good luck with your offers and congratulations for taking action. Every day you put forth an effort is a day that you are closer to accomplishing your goals. Keep us posted with these potential deals. Believe and Achieve! - Joe

In regards to your question about the First-Time Homebuyer Credit, the IRS website is an excellent resource for information. Per the IRS website, for the First-Time Homebuyer Credit - "Questions and Answers":

Question: Can a taxpayer claim the first-time homebuyer credit if the purchase is pursuant to a seller financing arrangement (for example, a contract for deed, installment land sale contract, or long-term land contract), and the seller retains legal title to secure the taxpayer's payment obligations?

Answer: If the taxpayer obtains the "benefits and burdens" of ownership of a residence in a seller financing arrangement, then the taxpayer can claim the credit even though the seller retains legal title. Factors that indicate that a taxpayer has the benefits and burdens of ownership include: 1. the right of possession, 2. the right to obtain legal title upon full payment of the purchase price, 3. the right to construct improvements, 4. the obligation to pay property taxes, 5. the risk of loss, 6. the responsibility to insure the property and 7. the duty to maintain the property. (7/2/09)

The link to the IRS Website which has more information is as follows:

http://www.irs.gov/newsroom/article/0,,id=187935,00.html

Winter has arrived in the Midwest. It is now time to get out those thick and heavy coats, gloves, hats and boots! The temperatures were in the low 20's to start the day and we have snow forecast for the weekend. I have to dig out my shovel and snow broom and get them ready for action. Snow for the holidays is good, but it can be a challenge to drive in it. The snow isn't as bad as the ice you normally do not see until you start feeling your car slide, that can be an adventure nobody wants.

I had an idea to find and track some new potential buyers and sellers. I have not tried it out yet, but I think it will work! Whenever people move to a new area or think about selling their home to move, they often get a self storage locker. You have probably seen these mini self storage units all over your area. Well, I thought why not approach the self storage locker office and see if you can leave a few fliers, business cards, etc. or better yet include a small ad or business cards in their monthly billing statement for you. You could be their sponsor that has a card that states "we buy and sell homes". If you have locally owned and operated self storage facilities this could be a way of finding that home before it gets listed or finding that next buyer looking for a home. In any event, it is worth looking into because of the target market.

One of the great things about real estate is each day you can learn and get ideas to better promote you and your business. So it is always very important to not only keep your eyes and ears open for deals, but also for things you can do to help promote your business. The best idea could be something new and creative that others have not tried yet. So try new ways to advertise and see what gets you the most calls in your area.

I hope everyone has a terrific Friday as we get ready for the weekend. Remember to drive your areas looking for those new deals and any other ideas that you can muster to advertise your business. The next deal can only be a new sign or flyer away. Believe and Achieve! - Joe

Good idea on the self storage. Maybe even some of the small moving companies that specialize in local moves might be good as well.

I’m just curious if I might be on the right track as far as the first time home buyer credit. If I understand what I have read, you should be able to purchase a home and lease option or rent it. I don’t see anything saying you have to live in the property yourself unless I missed that part somewhere. So if I'm reading correctly as long as you keep it for 3 years you would be fine. If you sale the property before the 3 years is up you would have to pay it back. Does this sound correct?

Thanks for the additional idea about small moving companies. This would be a good idea as well. You never know which idea will lead to more deals.

In regards to the first time home buyer credit, you do have to live there as stated in the IRS guidelines...it has to be "the taxpayer's primary residence". I located the following summary on the IRS site:

General Information
- "Homebuyers who purchased a home in 2008, 2009 or 2010 may be able to take advantage of the first-time homebuyer credit. The credit:
- Applies only to homes used as a taxpayer's principal residence.
- Reduces a taxpayer's tax bill or increases his or her refund, dollar for dollar.
- Is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed."

http://www.irs.gov/newsroom/article/0,,id=204671,00.html

Very Savvy!

Thanks for stopping by my journal. Good luck with all your future real estate deals. Believe and Achieve! - Joe

Friday sure came pretty fast this week. The temperatures were very low around 20 degrees and this was the first time since last March that I saw frozen ice along the sidewalks and street. In any event, the weekend will soon be upon us. I always believe that December is one of the fastest months that goes by because all of the fun gatherings that take place. It is always great to take the time each weekeknd to experience some fun along the way.

I had an opportunity to attend a pizza party with Santa Claus on Friday evening. It was a lot of fun to see all the kids so thrilled to meet Santa and have fun at the party. It made me think back of when I was young and we were not afraid to play games or climb bleachers or even jump off the bleachers. However, as we get older "common sense" does tell us not to jump off a high set of bleachers because we can break a leg.

I thought, though, does fear often get in the way with common sense. Do we fear trying to be successful with real estate investing? Are we afraid of the unknown, the journey or even the success? Does fear hold you back from making offers or pursuing that next deal? Make sure that you go back to your "WHY" you are doing this as Dean has often told us. Never let anything or anyone get in your way, espcially that emotion of "fear of the unknown".

I hope everyone has a terrific weekend. Be sure to take action and don't let fear ever get in the way of your journey toward success. You can do it and you want to make sure the biggest thing that may not be holding you back is you. Good luck finding that next deal. Believe and Achieve! - Joe

The weekend is here and the temperatures continue to fall. It was around 20 degrees this morning with a high of around 32 degrees (freezing). The first few days like this are always hard to get use to but are considered warm when we get to below zero in January. I watched the evening news and they are forecasting a heavy snow storm for mid-week. It can snow anywhere from 5 to 8 inches. This isn't as bad but it depends on the time of day. If it happens around rush hour, it will be a challenging drive home from work.

There was an arts and crafts fair we stopped at today in my local area. There were plenty of holiday items and ornaments. People tend to be in a more festive mood especially during this time of year. I always believe you should seize any and every opportunity to network. You never know where your next lead or contact may come from. Plus, you meet a lot of nice people along the way. You would be amazed at how many people do arts and crafts as a hobby on the weekends and during the week, they have a regular full time job. You tend to meet people from all types of industries.

I stopped to grab a few fliers on somes FSBOs in my area. I noticed another FSBO that was just listed with a realtor. These FSBOs can be future opportuntities of the sellers become flexible over time. I really enjoy riding through my target area to see all the new listings and keep a pulse on the market. I had a multi-unit on my radar and I knew it was priced right. I just wanted to see how quickly it sold once it was listed. It sold within 8 days from hitting the MLS. Thus, if properties are priced right, they are moving, even in this market.

I hope everyone has a festive and productive weekend. Keep an eye out for the next deal as your driving to the mall or the grocery store. Don't forget to pick-up those free Home books and check-out the bulletin boards at the super market. Your next deal is out there, will you see it? I know you will and we look forward to hearing about it! Believe and Achieve! - Joe

First, I want to thank you for all help. I greatly appreciate it.

If I want to flip a house (REO), what is the best percentage rate below market value that an investor is looking for? I will be double closing these deals.

Thanks again,
Anne

Every investor and every deal can be different. The best thing to do is when you build your buyer's list is to inquire to each buyer the types and price ranges of properties they are looking for. Usually, the bigger the discount the better. It depends on the market your in. In the Midwest, there are many deals out there where you can get 20-30% off the FMV. So investors in our area are looking for usually more than 35-40% off. Good luck with your future deals. Believe and Achieve! - Joe

I bookmarked the info on the First-time home buyers tax credit for future reference. Thanks for sharing Joe.

Sandra

Hey Joe, It is a little brisk today here in NY too. had a little snow come down last night but no accumulations.
There are a lot of great ideas on this site on how to build a buyers list. newbies just need to search around and take notes. besides CL and Backpage, there are other web sites you can look for buyers.
good job on picking up the flyers. I also look on the boards at the supermarkets. It is a good source for FSBO properties.
good luck on your investing.
Richie.

I can't wait for this conference coming soon. I don't know when the conference start, but I still keep waiting unitil it's cominig.I also waiting when my luck coming. If I get the property I am going to jump up to the sky. And prayer to Dean for ever because He hange my life.
kong sourivong.

Thanks for stopping by. The IRS website does have a lot of great information to reference. I am glad you found the link helpful. We wish you continued success on all your future real estate deals. Believe and Achieve! - Joe

Thanks for stopping by. Winter and the snow will be here before we know it. They are forecating a snow storm for mid week with accumulations now forecasted at 6 to 10 inches of snow. This won't be too bad if it doesn't happen during morning or evening rush hours. I always say snow is better than a blizzard. Thanks for the other tips on building those buyer's lists. Good luck on your future real estate deals. Believe and Achieve! - Joe

Thanks for stopping by my journal. Good luck with you next real estate deal. Just keep doing a little each day and this will move you closer to your goals and that first deal. Dean's books are packed with great tips, information, strategies and techniques. I am sure your first deal is closer than you think. I know a lot of people are excited about Dean's Gain the Edge 2010 live Conference event. This is a great event that is packed with a tremendous amount of the latest information, strategies and techniques used by successful investors today. This is a great event to attend and I can't wait to hear all the details. Good luck with real estate investing. Believe and Achieve! - Joe

The weekend sure went by pretty fast. I was under the weather and did not do too many outside activities. I was able to catch up on some real estate articles I wanted to read and spend the afternoon looking through some of the home books and Sunday Real Estate classifieds. The Sunday paper is always one of the best ways to find the new FSBOs. I found a few properties that I want to follow up on later in the week. Many of my neighbors are getting ready for the snow storm forecasted for the middle of the week. I see the salt bags out on the front porches and the shovels out of the garages and ready to go.

I updated some of my properties that I have been tracking on my radar and updated a few properties that have sold in my local target market area. I usually ask my real estate agent to forward me all sold properties in my target area under a certain price that sell every few months. This way it helps me keep a feel of the local fair market values in the market based on the recently "sold properties".

A few days ago I was even at the local Home Depot and ran into an Appraiser I had met a few months back. These types of home improvements centers are a great place to meet new real estate folks and making new real estate contacts. I saw this as a great opportunity to ask the Appraiser about my local market, how was his business and what he sees going on these past few months. It is always nice to get a few fresh perspectives on the real estate market area and to see the area from different perspectives and all angles. I listen and digest all the information I see, hear and read. Then I base my game plan on my thoughts once I digest everything I take in. I always feel that if you have enough good information, it makes offers and decisions that much easier.

I hope everyone has a great week ahead. The holidays are getting closer each day and so is the new year. So as they say, "out with the old and in with the new" because this is going to be a great new year! The deals will be more plentiful than the snow in the Midwest or the sands on the beaches of Hawaii! Good luck finding that next deal. Believe and Achieve! - Joe

I was searching on line at Realtor.com for a real estate agent, and I came across a real estate website with REO properties on there. Does that mean that they are the listing agent for those properties? Sorry for the stupid question....

Anne

You should always believe and understand that there is no such thing as a "stupid question." There are probably various other people that had the same question but did not want to ask. So always make sure to ask your questions because that is the way we all learn. Whenever you go to specific websites it may be difficult to tell whom the listing agent might be. When you do a search on various websites, it usually shows you the property and the real estate agent's information of where your searching from. If you search under realtor.com it will show you the listing agent. Thus, you can cross reference these websites with realtor.com and it should help you find the information you looking for. Believe and Achieve! - Joe

Monday are usually the longest days of the week. Even though you have 24 hours in a day, it always seems like there is more to do on a Monday than you have time for. On Saturday I saw a multi-family building while driving my target area. The building had a realtor's for sale sign but knowing my local market I knew this multi-family was not listed on the MLS yet. I called the number but did not hear back from the realtor, so I kept my eye on the MLS and sure enough it was listed on Monday morning.

This multi-family is located in an upscale neighborhood and has appeal to many renters based on the property location and curb appeal of the building. I called the realtor again on Monday and he stated "Oh yes, I did recieve your message on Saturday but I don't work weekends." I was slightly surprised but pressed on with my questions. This was a bank owned REO that was vacant for more than 2 years. I inquired about the winterizing of pipes and he stated, "yes the entire building was winterized". Then I inquired what about the basement?

The realtor stated you mean the piping? I said the piping yes but doesn't this proeprty have a sump pump? The relator said "oh yeah, the power was off and there was about 4 feet of standing water in the basement. I then went on to say what about the frunaces and hot water heaters? The real estate agent stated that they were being checked. It felt like I had to pry every piece of information from the realtor, but knowing the right questions to ask can go along way. I may take a look at this building but there are so many deals in the area, I hate to get too tied up with this one if it requires too much work.

I hope everyone has a great week ahead and I will keep you updated on the multi-family building with the temporary basement pool. Good luck on all those future deals! Believe and Achieve! - Joe

In escrow...is there a way you can save on escrow fees? Telling them this is short term, or something along those lines.

Thanks again

Joe, a fellow Hoosier that is NEW to the DG Team but looking forward to solving others problems and becoming successful along the way as you have. My wife and I actually ran across a deal like you described with the temporary pool in the basement. My mother and father in law were able to purchase the (foreclosure) property before it was listed with an agent. We helped them in gathering information (and pictures of the pool) to send along to the bank and were able to get the property at a generously reduced price. Most would have rejected this deal but with a little work and deodorizer it turned out to be a fairly good deal for them. We appreciate all the help that you and the other DG team members provide and look forward to meeting each of you in the future. T.Gunn

When you make offers on properties you are required to put down "earnest money" or an "earnest deposit" which can be any amount your propose and the seller accepts. The seller usually has a requested earnest amount deposit such as $1,000.

In regards to "escrow fees", these fees are paid to handle tranactions between 2 or more parties. These fees can be negotiated between the escrow agent and whomever contatcs them for the specific service. The escrow agent is an independent third party to help in handling the transaction between parties. I believe this helped answer your question, if not, please let me know. Good luck on all your future real estate deals! Believe and Achieve! - Joe

Thanks for sharing your story with us. It is true that sometimes if you see the value that others do not see that is where the profit can be made. If a property is messy or needs cosmetic work, or just needs a good clean-up with some elbow grease, the property can be polished up to be a real gem of a deal.

Also, welcome to the DG website. It's great that you are joining the discussion threads. The more participation we get, the more everybody can learn from each other and share stories, knowledge and experience. Good luck with real estate investing and all your future real estate deals! Believe and Achieve! - Joe

"Oh the weather outside was frightful and the drive home was anything but delightful, so since the traffic was a no go, there was snow, there was snow, there was snow!..." The first major snow arrvied in the Midwest. It looked festive but was a slippery drive home. Later in the evening the snow turned to a sleet rain so there was not much of an accumulation. It appears that winter has arrived a little early. On Thursday the artic cold will be upon us with a high of 9 degrees and a forecasted wind chill of - 20 (yes, negative 20). Wind chill is kind of the opposite of the humidity factor in the warm climates. The temperature may be 9 but with the wind it feels like -20.

As I left the city, the wind took the breath right out of me. A heavy coat and a good pair of boots is a necessity for the winter. When I got home, I spent some time looking at the real estate listings on the MLS. I did not see too many new listings. When the weather gets bad I enjoy making more offers because fewer people tend to venture out into the elements. Therefore, this upcoming weekend should be a busy weekend for making offers and driving my local area. Another tip to spot a potential vacant home is the accumulation of mail in the mailbox or a new phone book in those bright yellow bags that have sat on stairs for more than 2 weeks. In early November we received updated phone books in our local area. As I drove the area several weeks later and saw the yellow bag on the top stair of some homes, it told me either the home was vacant, a rental or the owner's may be on an extended vacation. At least it was a smaller target of properties to potentially look into.

I spent some time updating my action plan for the month ahead and made a list of some additional calls I desired to make. My to do list usually is a revolving door because as things are moved off, other things are then moved on. It keeps me focused and I believe I can accomplish more in a given day or week. If you have a long to do list, just try to do a few things each day and this will get you a little closer to your goals. The more you do, the more you want to do and it becomes a fun challanege each day.

I hope everyone has a great week with sunshine and nice weather. Good weather can make your day feel so different. That next deal is just an offer or a phone call away! Believe and Achieve! - Joe

Loved the "frightful" comment in your post! Just wanted to stop in, get caught up with your journal and say Hi! I've been away from the site for a while...working at it!
This morning I got a real workout with the snowblower and my dog nearly go lost in the snow! Nice & warm in the house though! Stay well Joe!!

Dawn