Save Seller Financing – Did You Post Your Comment? Do It Now!

Only a few days remain to post your comment on the proposed rule changes that could be the death knell for seller financing.  You can post your here http://1.usa.gov/pF9Fv0.  The comments I submitted can be found  below:

The SAFE ACT intended to protect consumers from big businesses and I applaud these efforts whenever they accomplish what they set out to do.  My concern is when unintended consequences arise and citizens, American property owners as well as future American property owners, can actually be harmed. I am requesting that private individuals be exempted from the proposed rules changes and submit the following comment.

1. The seller did not construct the home to which the financing is being applied.
2. The loan is fully amortizing (no balloon mortgages allowed).
3. The seller determines in good faith and documents the buyer has a reasonable ability to repay the loan.
4. The loan has a fixed rate or is adjustable after 5 or more years, subject to reasonable annual and lifetime caps.
5. The loan meets other criteria set by the Federal Reserve Board.

Under this Act the only buyers who will be able to use seller financing are the buyers who can already qualify for conventional financing with perhaps the exception of how much of a down payment they need.

Seller financing has always been the alternative to government regulated financing. It is a meeting of the minds between two private individuals who negotiate an arm’s length contract to purchase property using an installment sale.
Seller “financing” provides housing for millions who otherwise could not qualify for conventional loans.  It additionally, provides an outlet for properties that do not qualify for conventional or even GSE programs such as older manufactured homes that provide entry level and retirement housing for many Americans.

Homeowners are neither bank officers nor mortgage lenders.  By requiring them (many if not most of whom who take back a mortgage are older Americans) to qualify buyers using bank standards means they will simply refuse to sell with owner financing.  Thus millions of people will be deprived of home ownership.  This will have a near term negative impact on the current economy by reducing the number of sales which pay transfer taxes to our state and county governments and long reaching effects in terms of preserving property rights as well as one’s ability to freely buy and sell property.  Even the Wall Street Reform Act saw fit to allow up to 3 seller-financed transactions per year without MLO requirements.Why should a buyer be required to divulge their income and assets to the very person with whom they are negotiating the terms of a sale? This is not required when there is a 3rd party lender.  Requiring the buyer to turn over all their financial information to a stranger opens the door for identification theft and fraud.  It also deprives American’s, both buyers and sellers, to use their free will to honestly come to a meeting of the minds and transact the purchase or sale of a property in a manner beneficial to the principals (not a 3rd party lender who may have no vested interest).

This also opens the door to an additional risk; predatory borrowing. This is where an unscrupulous buyer knowledgeable about the Dodd-Frank Act leads an uninformed seller (and this will be the majority of sellers) into negotiations not in compliance with the ability-to-repay requirements. That buyer lives in the property trying to resell it for a profit and if they are not successful within three years they rescind the sale and get all their money back.  This will jeopardize the ability of many deserving people who may never qualify under bank standards (Federally mandated or not) to ever own their piece of the American dream because no one would accept that risk.

By not allowing a property owner to negotiate a balloon payment, there is a good chance that a seller 55 years or older will die before receiving all their equity. Many seniors have invested in real property with the intent of selling it using seller financing (an installment sale) in order to supplement their income in retirement, but also with the hope that they would not be stuck with a 30-year investment. The Dodd-Frank Act does the same thing insurance companies do that sell 30 year annuities to seniors. Our government has criticized this deplorable practice because seniors will die before they receive all their investment.
The restriction of no balloon doesn’t affect just seniors, it has financial consequences for anyone using seller financing. Under the Act community banks are allowed to originate fully amortizing loans with a five-year balloon. The rationale is that they hold these loans in their own portfolios and the government recognizes their need to hedge against inflation and rising interest rates. Yet, the Act does not recognize that private property owners who have 100% skin in the game need the same protection. If there has to be a restriction it should at the very least be the same allowance given to community banks of a balloon in 5 years.I have heard the suggestion that a seller financing the sale of his or her own property would completely avoid the issue of licensing by retaining the services of a licensed loan originator. If a mortgage loan originator (MLO) fails to properly follow the ability-to-repay guidelines the buyer still has three years in which to rescind the sale which leaves the seller at risk and will most likely bankrupt them.  As I am sure you can see, the unintended consequences of these proposed rule changes, if accepted “as-is” without exempting individuals will negatively impact millions of American families.

This could be financially devastating to the seller. Let’s not forget that today’s buyer will be tomorrow’s seller. These sellers are a diverse group. They come from all walks of life: low income, high income, non-English speaking, seniors, widows, minorities, but this requirement places the same standards on individuals as banks and mortgage lenders, only with more risk – the banker is in the business of mortgage loan origination and factors that risk into his business plan, whereas the individual seller does not have capital reserves and doesn’t do this as a business. Also, unlike a bank, they do not carry errors and omission insurance.

My mother is 80 years old and owns two properties; a condominium and a co-op.  Neither of these will qualify for bank financing in the current market.  At some point she may need to sell and convert these properties into an income stream to provide for her long-term care unless she can find a cash buyer.  A cash buyer will likely force her to accept a substantially lower price because she’ll have no other option available to her and she’ll be at risk that for up to 3 years, that a case of buyer’s remorse could reverse her sale.  Is that in her best interest?  Additionally, as her and many other seniors in a similar situation exhaust their reduced assets, the government will be forced to pick up the tab for her care, further exacerbating the federal debt or reducing the quality of life for America’s elderly.On behalf of my family and families across America I am asking that you clearly distinguish between banks who are lenders who actually lend money and property owners who are principals in negotiating an installment sale in order to collect their equity in the sale of a home.  In a seller financed transaction both parties are consumers neither of whom need be disadvantaged by these proposed rules.

Please feel free to contact me directly at Augie@PACTProsperity.com

Your decisions will impact millions of American families. Thank you for your consideration.

Your Property Rights Under Attack – Action Required NOW

This just in from The Paper Source Journal – Proposed changes to Regulation Z could threaten the future of property ownership in the United States.   Imagine selling a property and giving the buyer three years to change their mind?

RED ALERT — Seller Mortgages May Be Effectively Outlawed…You Must Act NOW!

by W. J. Mencarow

July 13th, 2011

From THE PAPER SOURCE JOURNAL, July, 2011:

The Federal Reserve, which received sweeping new authority under the Obama regulatory reauthorization, wants to effectively eliminate seller-held (a.k.a. purchase money) mortgages. It will do this by enacting a rule for the Dodd-Frank Act prohibiting property sellers from taking back a mortgage unless the buyer essentially can qualify for conventional financing!

What’s more, Ma and Pa Homeowner, who create 95% of seller-held mortgages, won’t be able to qualify buyers under the same underwriting standards that banks are required to perform, and therefore the cash flow notes won’t be created.

If this is enacted it also will remove access to housing for millions of Americans, because seller “financing” is the only way people who can’t qualify for conventional loans can buy a house.

Moreover, it would allow a buyer a three year right of rescission (they can cancel the sale) if the seller did not properly qualify them. The right of rescission also applies to anyone who buys the note.

We have precious little time to try to stop this. The deadline to comment is FRIDAY, July 22. See the information below, then go to snipurl.com/AbilityToRepay Please do it TODAY!!

(Thanks to Ric Thom [www.SecurityEscrow.com] for alerting us.)

Submit your comments at snipurl.com/AbilityToRepay — scroll down that page for the comments link.

THE DEADLINE IS FRIDAY, JULY 22!

Here Are Some Points You Can Make In Your Comments:

  • Seller “financing” provides housing for millions who otherwise could not qualify for conventional loans.
  • Homeowners are not bank officers or mortgage lenders.  By requiring them (many if not most of whom who take back a mortgage are elderly) to qualify buyers using bank standards means they will simply refuse to sell with owner financing.  Thus millions of people will be deprived of home ownership.
  • Why should the buyer be required to divulge their income and assets to the very person with whom they are negotiating the terms of a sale? This is not required when there is a 3rd party lender.
  • Requiring the buyer to turn over all their financial information to a stranger opens the door for identification theft and fraud.
  • This also creates the opportunity for predatory borrowing. This is where an unscrupulous buyer knowledgeable about the Dodd-Frank Act leads an uninformed seller (and this will be the majority of sellers) into negotiations not in compliance with the ability-to-repay requirements. (An example of that could be a balloon, an interest rate greater than 1.49% above a standard mortgage, or the seller did not know how to calculate the income-to-debt ratio correctly, or know what residual income means). That buyer lives in the property trying to resell it for a profit and if they are not successful within three years they rescind the sale and get all their money back.
  • By not allowing them to negotiate a balloon payment, there is a good chance that a seller 55 years or older will die before receiving all their equity. A lot of seniors have invested in real property with the intent of selling it using seller financing (an installment sale) in order to supplement their income in retirement, but also with the hope that they would not be stuck with a 30 year investment. The Dodd-Frank Act does the same thing insurance companies do who sell 30 year annuities to seniors. Our government has criticized this deplorable practice because seniors will die before they receive all their investment.
  • The restriction of no balloon doesn’t affect just seniors, it has financial consequences for anyone using seller financing. Under the Dodd-Frank Act community banks are allowed to originate fully amortizing loans with a five year balloon. The rationale is that they hold these loans in their own portfolios and the government recognizes their need to hedge against inflation and rising interest rates. Yet, the Act does not recognize that private property owners who have 100% skin in the game need the same protection. A  five year balloon is predatory lending. If there has to be a restriction it should at the very least be the same allowance given to community banks of a balloon in 5 years.
  • There are a lot of small builders that have a spec house or two that they can’t sell unless they offer great terms using seller financing. Otherwise they have to let these properties go back to the bank, which does not help housing or the economy.
  • It has been said that a seller financing the sale of his or her own property would completely avoid the issue of licensing by retaining the services of a licensed loan originator. If a mortgage loan originator (MLO) fails to properly follow the ability-to-repay guidelines the buyer still has three years in which to rescind the sale which leaves the seller at risk and will most likely bankrupt them.

My Comments To The Federal Reserve

By Ric Thom, www.SecurityEscrow.com

The Dodd-Frank Act does not exempt property owners who wish to use seller financing (installment sale) even though no money is lent, there is no table funding, and under the Truth and Lending Act they are not considered creditors. The Dodd-Frank Act (ACT) does exempt property owners who offer seller financing from having to become Mortgage Loan Originators (MLO) provided they only sell 3 properties or less in a 12 month period and they follow the restrictions below. Yet, the Act subjects the property owner to the same liability as an MLO:

Title XIV Section 1401 (2) (E)

1. The seller did not construct the home to which the financing is being applied.
2. The loan is fully amortizing (no balloon mortgages allowed).
3. The seller determines in good faith and documents the buyer has a reasonable ability to repay the loan.
4. The loan has a fixed rate or is adjustable after 5 or more years, subject to reasonable annual and lifetime caps.
5. The loan meets other criteria set by the Federal Reserve Board.

Under this Act the only buyers who will be able to use seller financing are the buyers who can already qualify for conventional financing with perhaps the exception of how much of a down payment they need.

Seller financing has always been the alternative to government regulated financing. It is a meeting of the minds between two private individuals who negotiate an arm’s length contract to purchase property using an installment sale.

The following is a breakdown of these restrictions. I listed them in order of greatest impact on property owners, buyers and the economy:

The seller determines in good faith and documents the buyer has a reasonable ability to repay the loan. The implication is that the seller must use the ability-to-repay underwriting requirements when offering seller financing consistent with the Dodd-Frank Act which amends the Truth in Lending Act. This new, proposed rule is 169 pages long: snipurl.com/fedrule

The Consumer Financial Protection Bureau has spent a lot of energy developing a new, easy to read, two page mortgage disclosure form. It is unreasonable to expect sellers and buyers to fully understand and apply this 169 page rule. If buyer’s and seller’s negotiations deviate in the least the buyer has up to three years to rescind the sale and demand back all money paid to the seller, or anyone that the seller might have assigned rights and interest to, or any bank that takes the note as a collateral assignment.

This could be financially devastating to the seller. Let’s not forget that today’s buyer will be tomorrow’s seller. These sellers are a diverse group. They come from all walks of life: low income, high income, non-English speaking, seniors, widows, minorities, but this requirement places the same standards on individuals as banks and mortgage lenders, only with more risk – the banker is in the business of mortgage loan origination and factors that risk into his business plan, whereas the individual seller does not have capital reserves and doesn’t do this as a business. Also, unlike a bank, they do not carry errors and omission insurance.

Unlike banks and mortgage lenders, both the buyer and seller are consumers. They should both be equally protected. The buyer is purchasing real property and the seller is investing in/creating a financial product where they receive their equity over time. The seller is relying on the buyer to make monthly payments and maintain and protect the property. Terms are not dictated to either party, but rather they are negotiated between the parties.

Requiring the buyer to turn over all their financial information to a stranger opens the door for identification theft and fraud.

Furthermore, why should the buyer be required to divulge their income and assets to the very person with whom they are negotiating the terms of a sale? This is not required when there is a 3rd party lender.

This also creates the opportunity for predatory borrowing. This is where an unscrupulous buyer knowledgeable about the Dodd-Frank Act leads an uninformed seller (and this will be the majority of sellers) into negotiations not in compliance with the ability-to-repay requirements. (An example of that could be a balloon, an interest rate greater than 1.49% above a standard mortgage, or the seller did not know how to calculate the income-to-debt ratio correctly, or know what residual income means). That buyer lives in the property trying to resell it for a profit and if they are not successful within three years they rescind the sale and get all their money back.

The SAFE Act does not put in place the ability to repay requirements, or any other requirements, unless the individual habitually and repeatedly uses seller financing in a commercial context. It is HUD’s position that Congress never intended under the SAFE Act to restrict private property owners from using seller financing, unless they did it as a business.

The loan is fully amortizing (no balloon mortgages allowed). By not allowing them to negotiate a balloon payment, there is a good chance that a seller 55 years or older will die before receiving all their equity. A lot of seniors have invested in real property with the intent of selling it using seller financing (an installment sale) in order to supplement their income in retirement, but also with the hope that they would not be stuck with a 30 year investment. The Dodd-Frank Act does the same thing insurance companies do who sell 30 year annuities to seniors. Our government has criticized this deplorable practice because seniors will die before they receive all their investment.

The restriction of no balloon doesn’t affect just seniors, it has financial consequences for anyone using seller financing. Under the Dodd-Frank Act community banks are allowed to originate fully amortizing loans with a five year balloon. The rationale is that they hold these loans in their own portfolios and the government recognizes their need to hedge against inflation and rising interest rates. Yet, the Act does not recognize that private property owners who have 100% skin in the game need the same protection. Obviously the Act does not recognize that a five year balloon is predatory lending. If there has to be a restriction it should at the very least be the same allowance given to community banks of a balloon in 5 years.

The loan has a fixed rate or is adjustable after 5 or more years, subject to reasonable annual and lifetime caps. This restriction is reasonable, but it will eliminate the ability for any buyer to wrap an existing obligation that has an adjustable rate even if they believe they can afford any rate increase. This is again inconsistent with the SAFE Act.

Moreover, if the seller does not know about the ability-to-repay requirements and that they are not able to have a balloon, they certainly will not know that you have to have a fixed interest rate for the first five years.

The seller did not construct the home to which the financing is being applied. There are a lot of small builders that have a spec house or two that they can’t sell unless they offer great terms using seller financing. Otherwise they have to let these properties go back to the bank, which does not help housing or the economy. There is also that group of unemployed construction workers who built their own homes when times were good and now need to sell. This takes away their ability to use seller financing.

Builders are in the business of building; not of originating loans.

Using a mortgage loan originator to facilitate a seller-financed transaction creates additional risk and expense for both the buyer and the seller. It has been said that a seller financing the sale of his or her own
property would completely avoid the issue of licensing by retaining the services of a licensed loan originator. If a mortgage loan originator (MLO) fails to properly follow the ability-to-repay guidelines the buyer still has three years in which to rescind the sale which leaves the seller at risk and will most likely bankrupt them.

Furthermore, there is no provision in a MLO’s errors and omission insurance that covers seller financing. None of the continuing education classes or the exams that an MLO must complete has a single chapter or question regarding seller financing.

Who is supposed to pay the MLO? MLOs can charge a flat fee or up to 3% of the transaction. The only advertisements I have seen so far advertise a flat nonrefundable fee of $450. This fee has to be paid in advance, which makes sense, because why would a MLO spend hours and hours on an installment sale transaction which might not close? If the buyer pays the fee, then this is a forced origination fee never before imposed on buyers seeking seller financing. Why should the buyer have to pay money just to have an offer presented to the seller?

A lot of buyers use seller financing because they are low income individuals, and seller financing, up to now, has been an inexpensive way to purchase property. If the seller pays they will have to pay money for the simple act of the MLO forwarding them the installment sale offer. If the seller receives multiple offers this could easily run into thousands of dollars in MLO fees just to sell their property.

A lot of sellers are also low income individuals. The MLO will have to be a part of every offer and counteroffer because the sale and terms of an installment sale are one and the same and cannot be separated. For instance, the buyer might be willing to pay a higher interest rate if the seller is willing to come down on the price and down payment.

A lot of seller financing takes place in rural areas that are underserved by mortgage lenders and banks. It is going to be very difficult to find a MLO in those areas who are also willing to take the risk facilitating a seller financed transaction.

This has the potential of pushing seller-financing underground – not a desirable result.

The Dodd-Frank Act allows a property owner to use seller financing without having to become a mortgage loan originator as long as they don’t use it more than three times in a 12 month period and comply with the above restrictions. In the SAFE Act there are no restrictions to the number of times seller financing can be used as long as you are not in the business of being a mortgage loan originator. The coauthor of the Dodd-Frank Act, Representative Barney Frank, sent a letter to HUD on July 22, 2010 urging it to place the maximum amount of seller transactions that an individual could do before becoming a MLO, or
having other restrictions on them, at five in a 12 month period. I would propose that the Dodd-Frank Act adopt that same number and place no restrictions on seller financing until 5 is surpassed. The only restrictions that should apply to 5 or less are those restrictions that the states already impose either through state statute or case law.

Under The Act loan officers at community banks do not have to become a Mortgage Loan Originator if they originate 5 or less transactions in a 12-month period. The rationale is that this is burdensome, costly and there is not enough volume to create a systemic risk. Ma and Pa on Main Street should be granted those same allowances. The Act puts more restrictions and risk on Ma and Pa than it does on financial institutions.

In watching the debates in Congress last summer it was repeatedly said that the Wall Street Reform and Consumer Financial Protection Act would not negatively affect or over-regulate Ma and Pa on Main Street. If this doesn’t negatively affect and regulate seniors, minorities, and lower income individuals on Main Street I don’t know what does. These restrictions will all but do away with seller financing, which will have a negative impact on housing, existing property owners, those desiring to be property owners and the economy.

Ric Thom is owner and president of Security Escrow Co. He is recognized as one of the leading authorities in seller financing on real estate contracts. www.securityescrow.com

Many thanks Bill Mencarow and Ric Thom and to all of you who submit comments seeking protection to property owners who are also consumers and who also deserve to be protected, not penalized for providing seller financing.

When Banks Won’t Lend

One of the greatest challenges facing agents, investors and even the general public today is the fact that qualifying for a bank loan has become increasingly difficult, if not down right impossible for many American families.  In spite of historically low interest rates many deserving families are being turned away.

What if we didn’t need the bank’s approval?  What if there was another way we could help sellers sell and buyers buy?  How would that impact your bottom line?  Not to mention, start a housing recovery that will lead this nation out of the current economic mess.

So the $64,000 question is, “How do we do it?

Answer:

  • Stop letting banks kill your deals
  • Stop letting bogus appraisals kill your deals
  • Learn legal, ethical alternatives to bank financing that work

There are alternatives to banks.  Don’t get me wrong, they are a good solution for some people but in today’s economic climate they aren’t the solution for a great many.  My grandfather used to say the only time you can borrow money from a bank is when you don’t need it.”

I’m excited to tell about a great Alternative Financing Workshop that is being offered in Celebration, Florida on July 28th at The Bohemian Hotel. With more loans getting declined than approved, NOW is the time to learn the tools, tips, strategies and techniques for buying and selling houses using alternatives to bank financing

As a result of this workshop you will be able to:

  • Pre-screen sellers who are able to provide financing alternatives…even when they weren’t aware of it!
  • Offer different buying solutions, even when the buyer cannot qualify for bank financing today
  • Earn commissions on a new set of transaction types
  • Close more deals!

Take action now and register at www.alternativefinancingworkshop.com :

Using these very same techniques I have bought and sold hundreds of houses and have become a nationally recognized speaker, author and real estate trainer.  Because I believe there is more than enough opportunity for everyone I have trained thousands of agents and investors across the country.

Most recently, I was honored to be designated as the national trainer for the CARI designation, Certified Agent for Real Estate Investors, by the National Real Estate Investor Association. In spite of all of this, my primary business remains houses and I continue to use these very same techniques day in and day out.

So take control of your business and join me for the Closing More Deals With Alternative Financing workshop and go to www.alternativefinancingworkshop.com.

You’ll be glad you did!

To your success…

Augie

PACTProsperity.com is a well-known and well-respected company specializing in Home Study Programs, Seminars and Workshops aimed at helping Real Estate Agents and investors succeed in today’s market.  We are here to help you take your results to a whole new level!

Please visit our website for additional information www.alternativefinancingworkshop.com.

 

Get more cash flow…NOW!

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One of the greatest opportunities we may ever see is staring us in the face. Mortgage rates have now been at historic lows for a while, the stock market has proven an unreliable wealth building vehicle for the average person. This has set the stage for building private lending relationships that can finance your real estate deals. But wait…this is an article about cash flow.

Fortunately I don’t have to start over because many of these private lending candidates are also candidates for equity participation deals. Imagine, if you will, you find a great deal you can purchase for cash at a 50% – 60% loan to value. You give your investor/equity partner 60% of the deal in exchange for them coming up with the cash to buy the property.

They come into the deal with immediate equity and you have no debt! If there is no debt there are no mortgage payments. You simply collect rent and pay the taxes, insurance and maintenance (unless you have your tenant take care of it). The remaining cash flow is split between you and the equity partner. Since you have used your skills and secured the deal you’ve already made a valuable contribution to the deal so you might also be able to get compensated for managing the property. You might take 8-10% off the top for management and then after paying the remaining expenses you split the remaining cash with your equity partner based on whatever percentages you agreed to (in writing).

You and your equity partner will divide the benefits from the property on whatever basis you establish. 50/50, 60/40, 70/30. You’ll split the cash flow, the appreciation, the depreciation and the tax benefits. It’s all up to you and whatever you negotiate. If you get really good at this you can even give up your 10% management fee and outsource property management and focus your time on finding more deals and more equity partners. The beauty of this strategy is that when you have a vacancy you don’t have an outgoing mortgage payment.

This is just one of the many strategies I like to use to lower risk and increase returns. While I realize I’m giving up some of the upside, I’m trading it for a perfect risk reduction strategy. Besides, using this strategy I effectively own half a house free and clear because the equity partner and I might be 50/50 in the deal. Let’s say I was a newbie without much experience, I might be willing to give 80% of the deal the equity partner because I’m trying to get started and don’t have cash of my own. Even if you give up 80% of your first five deals you’d effectively own the equivalent of one complete free and clear house! That’s powerful. As you develop your skills you’ll be able to command higher percentages because you’ll be a credible partner!

Do you want to learn how to do a deal like this? If you’re like most investors today, you’re facing no money, no credit, and no idea where to start. That’s where the right instruction can come in! Join us on April 2-3, 2011 at the REI Rainmaker Retreat in Orlando, Florida for two days filled with quality instruction on how to profit in today’s real estate market. From freeing up your time, to finding properties that your competition is missing, to running your business on free tools that you can use from anywhere…we’ve got all the bases covered. Tickets for both days are on sale right now for just $197 is you use the code “CREIG” at checkout.

CLICK HERE to learn more about the REI Rainmaker Retreat

Dress For Success and Generate More Leads

While you can’t always tell a book by its cover, a well wrapped package tends to be more inviting to explore than something that looks like it fell off the back of a garbage truck. I’m always surprised when I attend investor meetings. We’re an entrepreneurial bunch of independent business people that run the gamut in terms of style, appearance, and grooming.

What I find most interesting are the people who go to meetings to network, seek loans, find financial partners, or negotiate deals looking like an unmade bed. Ripped or soiled jeans, beat-up gym shorts, shirts that look as though they double as pajama tops and 3 days of beard stubble don’t inspire confidence. Some show up looking like a million bucks and others look like they don’t have two nickels to rub together. It is said that that average person sizes someone else based on visual cues (appearance) in about 15 seconds.

What’s the biggest challenge facing the new investor? If you’re new there’s probably a list as long as your arm and choosing just one can prove difficult. Is it establishing credibility? Finding leads? Letting people know what you do or want to do? What does an investor look like? A policeman has a uniform, a hat and a gun; a doctor has a white coat. Lots of people can be recognized by the uniform they wear; but what about the investor?

When I first began attending REIA meetings, (that’s Real Estate Investor Association for the uninitiated), I was always impressed by the folks with shirts that had their business logo embroidered on them. They looked more professional, seemed more confident, more knowledgeable, more… well you know…prepared. Why was that? I think it was because they looked the part. They looked like they actually had a real business because if they were willing to invest in branding their business on their apparel, they must also be doing other things well too.

I recently developed a new product called The Ultimate Lead Generation Program for Real Estate Investors. It provides over 100 ways to locate motivated sellers; many of them free or very inexpensive to implement. One strategy listed under the “A” section is Apparel and it can provide multiple benefits. Anything that looks good and says “We Buy Houses” can get conversations started by people asking, “How do you do what you do?” Do you want to buy their house? A professional appearance coupled with a simple marketing message can go a long way.

I’ve been using shirts and hats with my business logo for years. A buddy of mine has his rehab crews wear tee shirts with his log, message, and phone number on them. The workers like the free tee shirts and he likes the free advertising. Even if you don’t go for the logo look, think about the image you project; when you’re a well wrapped package it will definitely make a difference in your business.

To your success

Augie Byllott

One of the best providers for items with logos (and they can help you design the logo too) is Queensboro Shirt Company ; you can check them out right here: Queensboro

Are You Maximizing the Tax Credit? Top Homebuyer Questions…

According to the National Association of Home Builders, the following are top questions asked by prospective homebuyers. In all cases, buyers should check with the IRS or a qualified financial advisor for specific personal advice.

How does a homebuyer claim the tax credit?

The credit is claimed when the homebuyer files or amends his or her federal income taxes. For qualifying homes purchased in 2009 or 2010, the taxpayer must complete IRS Form 5405 and attach a copy of the settlement statement. In most cases, the settlement statement is a properly executed Form HUD-1.

Does the homebuyer have to sell their current home in order to qualify for the $6,500 repeat homebuyer tax credit?

No – a homebuyer does not need to sell their current home in order to be eligible for the repeat buyer credit. They can continue to own both homes and rent or use the former home for something else providing it no longer serves as their principal residence. The taxpayer is required to use the new home as their principal residence and live in it for at least 36 months; otherwise, they must repay the credit.

Do married couples both have to meet the eligibility requirements in order to claim the credit – even if they file taxes separately?

Both spouses must fully meet all the eligibility requirements for either the $8,000 first-time homebuyer tax credit or the $6,500 repeat buyer tax credit, regardless of whether they file joint or separate tax returns. However, if an unmarried couple purchases a home and only one person qualifies, the eligible person may claim the full credit.

Do all home purchases need to be completed by April 30, 2010, in order to be eligible for the credit?

There are two exceptions to the April 30 deadline. If the buyer enters into a binding contract by the deadline, they have until June 30, 2010, to complete the purchase. The deadline has been extended a year, to April 30, 2011, for members of the uniformed services, Foreign Service or employees of the intelligence community who have been on qualified extended duty outside the United States for at least 90 days between Jan. 1, 2009, and April 30, 2010.