There are many areas in which you can invest. Since I was 15 years old real estate I have searched for the fastest and most effective way to accumulate a lot of wealth, with the least risk. I am now 58 years old. While searching for this path to truth, I spent a lot of time in the school of difficulties. The school of difficulties is a very interesting but painful school to go to. It’s also the most expensive way to learn.

Graduate

But when you graduate you’ll have a Ph.D. in what to do and what not to do with your time and money. The schools I attended were: Investing in companies as a silent partner, owning my own business, working for another family member, in my case my father, buying publicly traded stocks and securities, penny mining stocks , trading raw materials, invest in gold and silver. , private real estate loans, real estate development, real estate remodeling, purchase of foreclosed properties. I have also worked as a real estate problem solver/matchmaker, matching entrepreneurs with corporate buyers and matching real estate owners with real estate buyers.

Writing about all of these activities would take an encyclopedia, so we’ll limit this essay to the kinds of situations you might encounter in hard-hitting real estate school. I will present my solution with the given situation. There is more than one possible solution and I invite you to think of other possible solutions as you read. If you take anything of value from my experiences, hopefully that will reduce your real estate school tuition considerably. Feel free to email me your feedback, workarounds, or stories. Please let me know that it’s okay for me to post them.

My real estate philosophy

In introducing myself, I thought you might find the lessons I’ve learned after all these years in real estate interesting. Buy real estate instead of stocks, bonds, mutual funds, or commodities. When you pick a winner in one of these non-real estate areas, you can earn 5-10 times your money. If you’re wrong, you can lose up to 90% of your money in any of these non-real estate areas. In real estate.

If you’re not greedy, if you’re not trying to get rich, in a year you can make 100 times your money, on the plus side. Downside risk is only based on how well you have looked at all the possibilities beforehand. If it did, the downside risk is limited to just waiting time to recover from an error. If you hurry up and don’t explore all the possibilities of a trading venture, you can lose 100% of your money. In my opinion, a 100x win advantage is better than 10x win.

My philosophy on real estate has changed in the last 15 years. I always thought that selling at the top of the market was the smart move and buying at the bottom. I now feel that buying when prices are low is still a smart move, but never selling is the way to go. Holding a property in a falling market requires good planning to survive the crash. This is what I call a back door or contingency plan. This is having a plan and knowing what to do if everything goes wrong with your original plan. If you have a backup plan, you will rarely need it. This is the basis of my philosophy. With this understanding, you may be able to better see why I did what I did in these situations.

The stories and the article:

The field of real estate investment is one of the most complex as it is a combination of law and real estate. It is one of the most interesting because fortunes are made and lost in this area, and the numbers are huge. Finally, it is an area where scammers can make a lot of money and often get away with it. Below are some stories (case histories) I have covered and some articles I have written on the topic of real estate fraud. Finally, for your interest, I have included an article on the basics of bankruptcy and real estate in general. I hope you enjoy.

It was early March 2000 and I got a call from Kevin We met for lunch and he told me the story of his life. The gist of this conversation is that he had purchased a 14-unit condominium in downtown San Bernardino, across from one of the toughest high schools in California.

At the end of the meeting, I discovered that I had overpaid about $75,000 for the building, had already wasted $200,000 remodeling it, and was still $100,000 away from completion. He had bought it 1.5 years ago and a large part of his costs consisted of the interest on all his loans related to this project. Now he was broke and in big trouble, but in his mind much-needed money was coming.

The stories:

It is interesting to note where he got the money to invest in this project. 4 years earlier, his father gave him money to buy an apartment building. He got enough money that he only needed a very small loan of $150,000 to buy a building in Pasadena that cost him a total of $525,000. To purchase the San Bernardino rehabilitation project, he first refinanced the first deed of trust for the Pasadena building and increased the loan balance to $385,000. When that money ran out.

He borrowed $74,000 as a second deed of trust on the Pasadena and San Bernardino properties. Plus, that loan cost him 15% interest and $15,000 in down payments to get the money. Before we broke up, I told him that he made a huge cost mistake buying San Bernardino. I explained to him that from the day he bought the building, the project was certain to fail. So I had to tell him that he wouldn’t lend him any money in San Bernardino to save his ass.

For the next 2 months, I received regular phone calls informing me of the progress of the fundraiser. In one of those updates, I was told that the existing lender on the second deed of trust said he could give Kevin the additional $100,000 he needed to complete the project. At the same time, Kevin also believed.

That he had found a bank that could refinance all of San Bernardino’s loans. The difficulty with the bank loan was that the appraisal fee was $3,000 and had to be paid up front even to apply for the loan. Again Kevin asked me for money. Once again I refused to put any more money into his black hole.

Then one morning I got a call from Kevin: “If I don’t make the $2,000 payment to the holder of the second deed of trust, the foreclosure will begin in 2 days. Kevin also told me, “The lender of the second deed of trust He said he would buy the apartment.

Building in Pasadena for what I paid for it, 4 years ago, $525,000.” The offer had a stipulation. Kevin had to bring the loan first. Why would he even bother to sell the property at that price? I couldn’t believe what I was hearing.

After hearing all of this, I decide it’s time to stop saying no and start helping. What Kevin thought he wanted was a real estate loan for a lot of money. The truth is that money was not the solution to his problem. The problem had to be different from what Kevin thought, so the problem persisted. The real situation was not more loans. Borrowing more meant more money down the drain.

Experience has taught me, “If the problem was what Kevin thought it was, it wouldn’t be a problem.” What does this sentence mean? A businessman has a financial setback. He believes that with some short-term financing he can bounce back from the setback and get back on top. After looking around, our entrepreneur will usually find the money, but strangely the problem is not solved.

If the problem solved itself, the businessman was right about what the problem was and the problem would go away. Normally money doesn’t help, but the employer doesn’t understand that. He doesn’t realize that the problem wasn’t money in the first place. If so, the problem would be gone now.

Let’s continue with the explanation. The last borrowed money is gone and the problem persists, so our businessman looks for more money to solve the problem that was not solved with the money he borrowed the first time. What happens the second time? Same. The money is gone and yet the problem persists.

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