How I went from NEGATIVE to POSITIVE like B.I.G. (And how YOU can, too.)

Notorious B.I.G.

“D@nm right I like the life I live, ‘cause I went from negative to positive…”

In his song “Juicy”, Notorious B.I.G. expresses his happiness with going from a life of crime to gaining wealth through his hip-hop music. You won’t find any crime stories in this article. But what you will find is me telling you a story of EXACTLY how I made money on a deal I was supposed to LOSE money on — all while setting myself up with some passive, residual monthly income in the process. Not to mention, I helped the buyer live in a home that they might not have been able to afford otherwise. Truly a win-win-win scenario for all of those involved.

You might be thinking to yourself: “How on EARTH did he do it!?”

I have two words for you, my friends: negotiating skills.

Negotiating skills is as essential for real estate investors as proper use of a level is for a carpenter, or a dictionary is for a writer. Develop your negotiating skills early and often. Some of these skills include treating everyone with respect and openness, thinking on the fly, and understanding all aspects of your deal, property and people involved. Of course this all develops better and better with time, but it’s never too early to get started.

Here’s a sneak peak of the 8 POSITIVE POWER STEPS I took to nail this deal:

  1. Grab all info ——————
  2. Comps Search using ? ——————–
  3. Contract property via ? —————-
  4. Immediately start marketing ——————-
  5. Sell the Property via ? ——————
  6. Have an amazing title ———————–
  7. Make sure it is recorded——————
  8. THE BEST STEP COMES WHEN WE ARE ALL FINISHED ———————-

 

Andrew Cruz 5yrs old Franklin Cruz's son“Power! Even with small muscles, like my 5 year old Andrew”

So how exactly did I contract a 3br/2ba concrete block home in central Florida for $27,000 plus a $7,184 profit per month? Stay with me and I’ll tell you, plus I will elaborate on these POWER STEPS that you can take in your own deals to optimize your profits or even help you turn a NEGATIVE deal in a POSITIVE one.

I initially got the “Baird Ave.” deal in Central Florida from a postcard campaign we ran. It was a probate deal, a brother and sister were to inherit the property from their mother that just passed. Our postcard told them why we’re the best at what we do and convinced them they should sell their property to us. Once they called, I ran a comps search using the online software tool Zillow. I HIGHLY RECOMMEND using this site to determine estimate values of properties.

After that, we decided to use Docusign to sign digital contracts. Once the contracts were finalized and we owned the property, I immediately started marketing the property as much as I could. Within a week or so, we had an email response from a guy named Jim. Jim said he could make an all cash offer of $25,000 on the property.

To which I replied:

Hey Jim,

Glad to hear you’re interested! HAPPY DAY! It is a great property. I have a proposal for you. Please consider the following price structure options:

1st Sale Price: $32,000

  •     $27,000 down payment
  •     $3,000 paid in 6 months of purchase
  •     $2,000 paid in one year of purchase

2nd Sale Price: $30,000

  •     $25,000 down
  •     $5,000 paid in 6 months of purchase

#3 Sale Price:

  •     $25,000 down
  •     $5,000 loan
  •     Annual interest rate – 8%
  •     Payments of $188.44/ month
  •     Schedule start date of loan – 12/3/13

We can close as early as next week, plus have our attorneys office write up the note. Which option would work for you?

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Not surprisingly, Jim ended up choosing option number 3 because it gets him into the property for only $184 a month. Jim gets the property at the price he wants and only has to make small payments for 2.5 years at a very reasonable interest rate, a much better rate than Jim would have gotten had he tried to use a credit card or a bank loan for this deal. So when all is said and done, I ended up making a total of $8,760 profit, with monthly cash-flow coming in.

first step to greatness

 Without further adieu, here are the FULL 8 POWER STEPS you’ve been waiting for.

8 POWER Steps Revealed:

  1. Grab any and all necessary and proper information: on the property, the neighborho the seller, and any buyers that might be initially interested, etc.
    Leave no stone unturned. There are no stupid questions when you’re gaining as much initial info as you can on the property and deal at hand. Surprises are almost never a good thing when it comes to real estate deals, so be sure to have all of your bases covered.

     

  2. Do a Comps Search using the online tool ” Zillow.com” or Zestimates for Rental Comps.
    While these sites aren’t 100% accurate, nine chances out of ten, you will get a good idea of the value of the property – instantly and on the fly.

     

  3. Contract property via Docusign.com
    Or some other online e-Signature software. This will save time, possibly save processing fees, and save some trees in the process of signing buying the property.

     

  4. Immediately start Massive Marketing Campaigning.
    This goes beyond “getting the word out there.” Let everyone you know feel how passionate you are about the property, how you want to help a buyer move into it, and if you can offer any payment options.(as I did in this particular deal) Create social media profiles, join any local online real estate groups you can. Sign up for direct mail marketing with Click2mail.com. This is how I get many of my leads on who might be interested in buying properties from me.

     

  5. Sell the Property via Terms
    Be creative with your options. Give the buyer as much flexibility as you can, but don’t skimp on your profits just to make a buyer happy.** I HIGHLY RECOMMEND discussing these options with your mentor! VERY few people in this country understand TERM deals and the proper way of structuring. **

     

  6.  Have a amazing title company structure the note and terms of the note.
    Spending a few extra dollars on a quality title company can leave an impression in your buyer that could lead to future sales if they’re pleased with you. Don’t let the reason they are displeased with you be because you were too cheap to hire a title company.

     

  7. Ensure the deal is officially recorded and that your payments are scheduled for automatic deposit into your bank account.
    This way your buyer won’t have to worry about writing you a check every single month and you won’t have to cash a check – the funds will just show up in your account. Talk to your bank for more details and how to set it up if you don’t know how.

     

  8. Pat yourself on the back You DID IT! YOU ROCK!
    This step is the most fun. You kicked some SERIOUS BUTT on this deal! Keep it UP! You’re doing some amazing work!


    Essential software tools that I used in the 8 power steps:

  • Docusign.com — e-Signature software for completing Digital Contracts
  • Click2mail.com – for leads coming from direct mail marketing campaigns
  • Zillow.com or Zestimates  — for comp searches and instant online property value assements
  • Freedomvoice.com — virtual calling service to conduct conference calls if necessary on a deal

Follow these 8 simple power steps and you too can start to make your negative a positive. Don’t get frustrated or discouraged if you don’t make this kind of stellar deal right out of the gate. It takes time to develop negotiation skills like mine. But that’s why your mentor is available to you, so feel free to call me with any questions. I’m here to help you, because even Biggie had to start out small and then go from negative to positive.

Keep it positive. Stay healthy and wealthy, my friends.
Respectfully,
Franklin A. Cruz
Clever Investor Mentor

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