I want you to succeed ! If you read this page and implement these strategies and actions into your business, you will be assured of success.
Continue reading How to GUARANTEE Your Success Wholesaling Houses
All posts by Duncan Wierman
Word Of Mouth Advertising
4 Rules of Word of Mouth Marketing
Word of mouth or "buzz" marketing has always been a necessity for any business. But since tools on the web make it easier than ever to talk about a product it’s becoming vital. Look at Amazon reviews or yelp.com.
1. Be interesting, be remarkable – Ask yourself, what have you got? Create a 10 Second commercial for yourself.
2. Make people happy –
3. Earn trust and respect –
4. Make it easy for people to talk about you – What do you do? You talk about it.
You’ve got to collect email address and communicate to them. Email is just the number one way."
Email Marketing – The Basics
E-mail marketing strategies are not really very complicated and can easily be used by just about anyone.
This form of advertising is being used by hundreds of thousands of companies all over the world. If your small business hasn’t joined the movement then you could be missing out on revenue, customers and brand recognition. Like all things in small business, you have got to start somewhere. Now is the time to begin your company’s e-mail marketing campaign. This report will get you started quickly and easily. Continue reading Email Marketing – The Basics
10 Traditional Powerful Methods of Real Estate Lead Generation
Are you lacking in sources of good quality leads? Even tho I teach guerilla marketing, these traditional "old school" methods still work.
Here are the 11 most profitable o f these old school methods I’ve used for lead generation
Sphere of Influence
Create a list of at least 100 people you know. Send out an introductory letter telling them about your service. Talk with each person at least every three months. Send them information of interest at planned intervals throughout the year. Consistently ask for and receive quality referrals. Remember, if each person you know also knows 100 people, well you get the idea. ( Bird dogs, Private Money, )
Cold calling
Using cold calling effectively for sales lead generation requires five key ingredients. Target the market you are going to call. Know your objective (get an appointment, get a name). Have a memorized script. Smile. Be prepared for rejection. Have fun! ( Motivated Sellers)
Knocking on doors
This method is much the same as cold calling. I used this very effectively in real estate. I used to knock on doors year round. Do you think people would remember someone who knocked on their door in the middle of winter?
(foreclosure marketing)
Farming
This is another technique that is used effectively in real estate and can be adapted to any product or service. Pick a market of 200 homes or businesses and become the only person they think of in regards to your product or service. ( Pretty Home Selling – Realtors Use this method still )
Seminars
Seminars are great for sales lead generation. People who attend your seminar have an interest in the information you are presenting and a need your service. (Motivated Sellers, Hungy Home Buyers – Private lenders)
Mass mailing
Also known as direct marketing. Successful used of this method requires mailing a well written sales letter to a targeted mailing list. (
Newspapers
Pay attention to the local news, business and announcements sections. Look for the people who get promoted, have babies, buy and sell homes and start up new businesses. There may be leads here for your product or service.
Email publications
Getting email addresses of past and current clients, your sphere of influence and any one else you come in contact with is a great way to keep in touch.
Hairstylist
Most everyone has a barber or hairstylist they use on a regular basis. When ever I’m in the chair the conversation covers a variety of topics.
Offer them a $1 for every card they pass out or motivate them even more by offering a percentage of the sale that result from their referral.
I’ve even picked up business myself while getting my haircut. Keep your ears and eyes open at all times.
Daily Contacts
Every day when you leave the house take twenty business cards with you and make it a point to give them away. That’s twenty cards times five work days. If you’re really ambitious, do it on Saturday and Sunday also.
When you’re looking to generate lots of quality sales leads the more lines you have in the water the more fish you’re apt to catch.
These are all effective methods of sales lead generation and should be used regularly.
Email Formats – Text versus html, which is better?
There is some debate over whether the traditional “text only” or the newer HTML email is superior. Each has its proponents. “Text only” devotees argue that since most personal email is in that format, email marketing should be done that way, too. They argue that HTML email literally screams "advertisement".
On the other hand, HTML email has some advantages … the ability to include graphics, and the fact the result can be visually pleasing, chief among them. Many newsletter publishers use HTML format to "jazz up" and dazzle their subscribers.
One big advantage of HTML email is that most autoresponders can track the “open rates” of HTML email, whereas “open rates” cannot be tracked for text messages. Another is that you can "mask" links, in the same way you would on a web page.
It would seem you have to choose one or the other format, but it is possible to have the best of both worlds. How?
Create an HTML email that looks like text. You can still include graphics, and have the chance to track your “open rates”, but you don’t suffer the drawback (if there is one) of turning off some of your readers with your flashy “web page within an email”.
Here’s what you do. Create a table that is 65 characters wide (you DO break your lines there, don’t you?) and put your content inside it, using a standard email font such as Courier, Times New Roman, or Arial, using black type on a white background. Include any graphics or links that you care to.
The finished product is then sent as HTML email. It looks exactly like a text email at first glance, except for any graphics or links that you included. Most people will probably never notice that it isn’t a standard email. A few may think you are pretty clever for being able to get that graphic inside an otherwise conventional email.
The big advantage for you is the ability to track your open rates and include those graphics and links. You can even mask your affiliate links, if you’d like to. Limit yourself to one graphic, though, or you’ll run the risk of triggering a spam filter, and keep in mind that the mere fact your email is HTML will earn you fractional points from the spam filters.
Maybe you, like most email marketers, still prefer to send the standard “text only” email, but have wanted a few of the major advantages of HTML …
Now you can have the best of both worlds.
How To Buy and Sell Real Estate with Your IRA
Did you know that you can invest in real estate, mortgages, leases, and LLC’s and many other investments all in your IRA? Your Self Directed IRA can even lend and borrow money. It has proven to be a powerful vehicle to build investment wealth and limit risk; all while reducing or eliminating future tax considerations and thus being truly DIVERSIFIED. How is this possible? Self-Direction.
Continue reading How To Buy and Sell Real Estate with Your IRA
How To Make An Extra 25K on Equity Splits
Have you ever come across a seller who is motivated to do a lease option with you, but not quite motivated enough to give up on all the future appreciation of the property? This is a perfect scenario to try using an Equity Split.
You may be familiar with the concept of “equity splitting.” This is where you and the seller essentially partner up and agree to split the profit from the resale of the property according to some specific ratio.
Here is how I teach my students to make up to an extra $25,000 or more on every equity split they do. It’s call a Hybrid Equity Split and I think you’ll like this simple yet highly profitable technique and want to add it to your toolbox of investing ideas.
The best way to understand the concept is to walk through a case study of a deal we did with the owners of a two bedroom, two bath property. The sellers were motivated because the husband had been transferred in his job. When I met with them we talked through doing a 8 year lease option on the property. Right at the very end they balked and I pulled out this Hybrid Equity Split idea to sweeten the deal just enough to get it closed.
The terms of the lease option were as follows: A term of 8 years with a monthly rent of $913 and a purchase price of $102,000. The up-front option consideration I paid was $1.
Now most investors would structure their equity split as follows: anything they as an investor sold the property for over $102,000 they would split with the seller on a 50-50 basis. For example, if they sold the property on a 2 year rent to own for $120,000 then they would give the seller the first $102,000 and split the remaining $18,000 profit 50-50. In other words, they would make $9,000 from the resale plus any cashflow the property generated over the two years.
The way we structured our Hybrid Equity Split was as follows: we did the 8 year lease option as described above and agreed that we would also do an equity split on anything we re-sold the property for above $127,000. In other words, the first $25,000 in profit would be ours alone and we would do the equity split on any amount above that.
By the way, why offer 50-50 to a seller when they will often times be thrilled with substantially less? We agreed they would get 12% of the amount we resold the property for over the $127,000!
How did we get the seller to agree to this? We simply asked the seller, “Mr. Seller, if there was a way where you would get your full $102,000 we talked about and on top of that you would get a chunk of the future appreciation from the resale of the property is that something we should talk about, or probably not?” (Those of you who have gone through any of our books or courses will recognize the “negative phrasing” I just used there.)
Once the seller says that yes he is in fact interested in talking about that you simply go on to explain, “Well, I don’t know if we could do this, but what if we set a percentage that you would get from the resale of the property. Obviously we would need to build in a minimum base profit of $25,000 in to make this worth our time, but what if we said that anything we sold it for down the road over $127,000 you would get set percentage of that? What I mean is that you would get ALL of the first $102,000, that’s completely yours, and you would also get lets say 10% or maybe a little more of any amount we sold it for over $127,000. Is that something we should talk through, or probably not?”
Our seller agreed to this, after negotiating strongly to move the percentage from 10% to 12% (notice he just accepted the $25,000 base profit!) We then sold the property on a 2 year rent to own with $3,000 non-refundable option money, for a rent of $1,000 per month, and a final price of $120,000.
While it looks like this tenant buyer will end up buying at the end of their term, if they don’t then we pocket the $3,000 option payment plus the $2,088 of cashflow ($87/month x 24 months) and simply go find a new buyer. At that point the we’ll sell the property for more money (probably $134,900) collect another option payment, and get more of a cashflow because the market rents have increased.
Key Point: You are only doing the equity split on the money from the resale of the property. You get to keep all of the cashflow and all of the option money that is left if a tenant buyer decides not to exercise their option.
Notice in this case, even if you offered the seller a “50-50” equity split on the amount over $127,000, you would still make 90% of the total profit! How? First you made $5,088 from your first tenant buyer, you’ll make at least another $2,000 in cashflow from your second tenant buyer. Plus you will make $28,950 from the difference in your option price and your selling price (you get 100% of the first $25,000 plus 50% of the next $7,900.) All totaled you would make 36,038 from your equity split. Your seller would pocket an extra $3,950 (50% of the amount you sold it for over $127,000.) In this case you made 90% of the profit from your “fifty-fifty” equity split!
Just remember to build in a base profit for yourself on any equity split deal you do. Even if it’s only $10,000 or $15,000 before you split the rest of the money that is PURE profit for no extra work.
The final point when you are negotiating an equity split is the manner in which you approach the seller. It’s critical that the seller doesn’t feel you are chasing after them like a hungry buyer desperate to make a deal. You need to maintain your “reluctant buyer” status.
The best way to be a reluctant buyer is to use the language patterns that reluctant buyers use. Qualify your statements with phrases like, “Well, I don’t know if we could do this, but what if…” Or, “My partner might not go for this idea, but what about…”
Tax Liens in regards to Property
Tax liens in connection with property taxes
Unlike personal debts, tax liens on real estate “run with the land”; that is, a property owner becomes responsible for payment even if the tax obligation was incurred by a prior owner. Depending on the law of the State or jurisdiction, the owner of the property may also be personally liable for payment of the taxes.
Payment of a tax lien may occur through various methods:
- Payment may be made directly by the property owner or, in many cases, indirectly by the mortgage holder using an escrow account. Notice is given both to the property owner and mortgage holder when a property tax is delinquent; thus, even if the property owner does not have an escrow account on the mortgage, the mortgage company will receive notice of the delinquency and may pay the tax. The mortgage company will then demand repayment from the owner/borrower and/or create an escrow account to recoup the proceeds, since the mortgage company might lose some of the value of its mortgage lien if the property were sold by the taxing agency to satisfy unpaid taxes foreclosure.
- If a property is sold by the owner prior to tax foreclosure by the government body, the tax lien (which is generally discovered as part of a title search) is usually paid as part of closing costs from the sale proceeds.
- Procedures vary from State to State. Generally, in the event a tax lien on personal property is not paid within a specified time (and after several notices are generally given), the property may be seized and sold at foreclosure sale. On real property, one of two methods may be used: either the property may be seized and sold (a tax deed sale), or in some States the tax lien may be offered to investors (in the form of a tax lien certificate) with an accompanying right for the investor, after a specified period of time, to institute foreclosure proceedings (a tax lien sale).
Federal tax lien in the United States
In the United States, the Federal tax lien may arise in connection with any kind of Federal tax, including but not limited to income tax, gift tax, or estate tax.
Federal tax lien basics
Internal Revenue Code section 6321 provides:
-
- Sec. 6321. LIEN FOR TAXES.
-
- If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belong to such person.[1]
The term “assessment” refers to the statutory assessment made by the Internal Revenue Service (IRS) under (that is, the formal recording of the tax in the official books and records of the U.S. Department of the Treasury). Generally, the “person liable to pay any tax” described in section 6321 must pay the tax within ten days of the written notice and demand.[2] If the taxpayer fails to pay the tax within the ten day period, the tax lien arises automatically (i.e., by operation of law), and is effective retroactively to (i.e., arises at) the date of the assessment, even though the ten day period necessarily expires after the assessment date. Internal Revenue Code section 6322 provides:
-
- Sec. 6322. PERIOD OF LIEN.
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- Unless another date is specifically fixed by law, the lien imposed by section 6321 shall arise at the time the assessment is made and shall continue until the liability for the amount so assessed (or a judgment against the taxpayer arising out of such liability) is satisfied or becomes unenforceable by reason of lapse of time.[3]
Under the doctrine of Glass City Bank v. United States[4], the tax lien applies not only to property and rights to property owned by the taxpayer at the time of the assessment, but also to after-acquired property (i.e., to any property owned by the taxpayer during the life of the lien).
The statute of limitations under which a Federal tax lien may become “unenforceable by reason of lapse of time” is found at . For taxes assessed on or after November 6, 1990, the lien generally becomes unenforceable ten years after the date of assessment. For taxes assessed on or before November 5, 1990, a prior version of section 6502 provides for a limitations period of six years after the date of assessment. Various exceptions may extend the time periods.
Perfection of Federal tax liens against third parties (the Notice of Federal Tax Lien)
A Federal tax lien arising by law as described above is valid against the taxpayer without any further action by the government.
The general rule is that where two or more creditors have competing liens against the same property, the creditor whose lien was perfected at the earlier time takes priority over the creditor whose lien was perfected at a later time (there are exceptions to this rule). Thus, if the government (which is treated as a “creditor” with respect to unpaid taxes) properly files a Notice of Federal Tax Lien (NFTL) before another creditor can perfect its own lien, the tax lien will often take priority over the other lien.
To “perfect” the tax lien (to create a priority right) against persons other than the taxpayer (such as competing creditors), the government generally must file the NFTL[5] in the records of the county or state where the property is located, with the rules varying from state to state. At the time the notice is filed, public notice is deemed to have been given to the third parties (especially the taxpayer’s other creditors, etc.) that the Internal Revenue Service has a claim against all property owned by the taxpayer as of the assessment date (which is generally prior to the date the NFTL is filed), and to all property acquired by the taxpayer after the assessment date. (As noted above, the lien attaches to all of a taxpayer’s property such as homes, land and vehicles and to all of a taxpayer’s rights to property such as promissory notes or accounts receivable.) Although the Federal tax lien is effective against the taxpayer on the assessment date, the priority right against third party creditors arises at a later time: the date the NFTL is filed.
Subsequent liens taking priority over previously filed Federal tax liens
In certain cases, the lien of another creditor (or the interest of an owner) may take priority over a Federal tax lien even if the NFTL was filed before the other creditor’s lien was perfected (or before the owner’s interest was acquired). Some examples include the liens of certain purchasers of securities, liens on certain motor vehicles, and the interest held by a retail purchaser of certain personal property.[6]
Federal law also allows a state — if the state legislature so elects by statute — to enjoy a higher priority than the Federal tax lien with respect to certain state tax liens on property where the related tax is based on the value of that property. For example, the lien based on the annual real estate property tax in Texas takes priority over the Federal tax lien, even where an NFTL for the Federal lien was recorded prior to the time the Texas tax lien arose[7], and even though no notice of the Texas tax lien is required to be filed or recorded at all.
Notice of release of Federal tax lien
In order to have the record of a lien released a taxpayer must obtain a Release of the Notice of Federal Tax Lien.[8] Generally, the IRS will not issue a notice of release of lien until the tax has either been paid in full or the IRS no longer has a legal interest in collecting the tax. The IRS has standardized procedures for lien releases, discharges and subordination. In situations that qualify for the removal of a lien, the IRS will generally remove the lien within 30 days and the taxpayer may receive a copy of the Certificate of Release of Federal Tax Lien.
The difference between a Federal tax lien and an administrative levy
The creation of a tax lien, and the subsequent issuance of a Notice of Federal Tax Lien, should not be confused with the issuance of a Notice of Intent to Levy under , or with the actual act of levy under . The term “levy” in this narrow technical sense denotes an administrative action by the Internal Revenue Service (i.e., without going to court) to seize property to satisfy a tax liability. The levy “includes the power of distraint and seizure by any means.[9] The general rule is that no court permission is required for the IRS to execute a section 6331 levy.[10].
In other words, the Federal tax lien is the government’s statutory right that encumbers property to secure the ultimate payment of a tax. The Federal tax levy is the actual seizure of that property.
In general, a Notice of Intent to Levy must be issued by the IRS at least thirty days prior to the actual levy. Thus, while a Notice of Federal Tax Lien generally is issued after the tax lien arises, a Notice of Intent to Levy (sometimes misleadingly called simply a “notice of levy”) generally must be issued before the actual levy is made.
Also, while the Federal tax lien applies to all property and rights to property of the taxpayer, the levy is subject to certain restrictions. That is, certain property covered by the lien may be exempt from an administrative levy.[11] (Property covered by the lien that is exempt from administrative levy may, however, be taken by the IRS if the IRS obtains a court judgment.)
A detailed discussion of the administrative levy, and the related Notice, is beyond the scope of this article.
In connection with Federal taxes in the United States, the term “levy” also has a separate, more general sense of “imposed.” That is, when a tax law is enacted by the Congress, the tax is said to be “imposed” or “levied.”
Notes
- ^ .
- ^ See 26 C.F.R. section 601.103(a).
- ^ See .
- ^ 326 U.S. 265 (1945).
- ^ See .
- ^ .
- ^ See and Tex. Tax Code sections 32.04 and 32.05(b).
- ^ See .
- ^ See and (italics added).
- ^ See Brian v. Gugin, 853 F. Supp. 358, 94-1 U.S. Tax Cas. (CCH) paragr. 50,278 (D. Idaho 1994), aff’d, 95-1 U.S. Tax Cas. (CCH) paragr. 50,067 (9th Cir. 1995). The IRS may, however, be required to obtain court permission in the case of bankruptcy; see .
- ^ See .
Glossary Of Real Estate Terms
Search Engine Optimisation
Search engine optimization (SEO) is a subset of search engine marketing, and deals with improving the number and/or quality of visitors to a web site from “natural” (also known as “organic” or “algorithmic”) search engine listings. In effect, SEO is marketing by appealing to machine algorithms to increase search engine relevance and ultimately web traffic. This is analogous to foot traffic in retail advertising. The term SEO can also refer to “search engine optimizers”, an industry of consultants who carry out optimization projects on behalf of clients.
How Does A Lien Priority Affect You?
How does Lien Priority affect you?
To explain this as simple as possible, when you buy a home and get a loan for the home, the lender puts a lien on the property. By doing so, the property becomes collateral for the loan. So, in the event the homeowner is unable to make payments, the lender can force the sale of the home to get paid. There can be several liens at one time on a single property?
Lien priority is based on when things get recorded. So let me give you an extreme example to illustrate lien priority.
Here is an example situation with about everything that you could possibly come by. We have a 1st mortgage for $250,000 with $15,000 in arrears. This would include all back payments, late fees, attorney fees and all the other fees they tack on. This was recorded 6-20-1999. We have a 2nd for $60,000 with $5000 in arrears. Again this includes the back payments and fees. This was recorded 7-21-1999. We have two judgments. One for $2000 recorded 3-2-03, and one for $4000 recorded 4-2-03. We have $3000 in state income tax recorded 5-5-04. We have a $6000 IRS tax lien recorded 10-20-04. And finally we have $5000 in property taxes recorded 2-11-05. Believe it or not all of these are different which we will talk about.
If we take a look at this example, we have a 1st mortgage and we can clearly see it was recorded first in 1999. We also have a 2nd who is clearly in 2nd position. Then we have a couple of judgments. The judgment for $2000 is in 3rd position because it was recorded before the $4000 judgment. So the $4000 judgment is in 4th position. Then we have state income tax for $3000 which is in 5th position.
Here is a simple version.
- 1st Mortgage -$250,000 recorded 6-20-1999
-arrears $15,000
2nd Mortgage – $60,000 recorded 7-21-1999
-arrears $5000
Judgment 1 – $2000 recorded 3-2-2003
Judgment 2 – $4000 recorded 4-2-2003
State Income Tax $3000 recorded 5-5-2004
IRS Tax Lien – $6000 recorded 10-20-2004
Property Taxes – $5000 recorded 2-11-2005
Are you starting to see the pattern? It’s all based upon when you record. Whoever records before another would be in "Senior" position and the other would be "Junior". Hence the terms senior or junior lien holders.
Now we get down to the last 2. These last two have rules which we need to discuss. If we look at when these were recorded, the good ole IRS tax lien would be in 6th position. Now even though the IRS is in 6th position, they have what’s called redemption rights. So here is the rule for IRS. It doesn’t matter what position they are in, they could be in last position. If there is still equity in the property, they have 120 days to redeem the property. Why would they want to redeem the property? If there is a great deal of equity in the property and they know it, they can use that money to satisfy any tax liens. It is very rare the IRS does this, but is can happen.
Then we finally get down to the state property taxes. All of you need to remember this. This is very important. Here is the rule for property taxes. State property taxes have priority over EVERYTHING. It does not matter when it was recorded. If you look at this example, there is $5000 of unpaid property taxes that was recorded after everything else. It was recorded 6 years after the first mortgage. Guess what? It does not matter. Property taxes always get paid first.
So if we take a look at this example from what we just discussed, and the first is foreclosing – what is the opening bid at the auction? $250,000 + $15,000 + $5000(property taxes) = $270,000. All the other junior lien holders are wiped out if they don’t protect their position except for… the IRS tax lien. Remember, they have their redemption period. Now here is something else you need to understand. Even though everyone was wiped out, the junior lien holders can still go after the borrower. This is called a deficiency judgment. Again this does not happen very often but it does happen. A deficiency judgment is an unsecured debt and does not attach to any property. Then depending on your states laws they can collect this debt.
If the 2nd is foreclosing – what is the opening bid? $60,000 + $5,000(arrears) = $65,000 and you are responsible for anyone senior, in this case the 1st of $270,000 for a grand total of $335,000. And everyone junior to the 2nd lien holder is wiped out except for IRS. See why it’s so important to know who is foreclosing?
Best Legal Advice For Pennies – Legal Shield
A Legal Shield membership gives you access to quality law firms for $26 a month or less.
Have you ever…
- Been overcharged for a repair?
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- Needed Real Estate Advice?
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- Been Messed around by a contractor?
- Security deposit issues?
- Signed a contract or needed one reviewed?
- Prepared a will?
Even though most people find themselves in these situations, the majority do not seek the advice or help of a qualified lawyer. Why?
- It may cost too much.
- They may not know where to begin.
- The process is intimidating.
You only get as much justice as you can afford. If you don’t know your rights, you simply don’t have any! The top 10% of income earners can afford to have a lawyer on retainer and are accustomed to asking their lawyer for advice before making decisions. What about you?
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