When you are preparing to do your multifamily deals, remember that your mindset plays a crucial role in your success. You must believe that you are worthy of success and of the financial freedom that you desire. The money that is available to you is unlimited and you need to grasp a hold of that. Not only that, but you need to be aware of how words that you use when working with your private money sources affect your ability to seal the deal.
The labels that you attach to yourself play a major role in your ability to succeed. The word investor is thrown around a lot and this can create confusion. An investor is someone who has money and is looking for an investment vehicle. You need to refer to yourself as an entrepreneur.
An entrepreneur is someone who uses other people’s time, talent and resources to achieve his or her vision. This is what you are! An entrepreneur is someone who brings deals to the money while the investor is someone who brings money to the deals.
Entrepreneurs get in the marketplace and solve problems and then move onto the next challenge. They are the “movers and shakers” and make things happen. If you call yourself a real estate entrepreneur, that language alone will empower you.
Once you have established your role, you then need to realize that the potential money sources are limitless. This mindset that you have limitless funds available to you is critical in helping you keep your focus. You need to determine how you are going to use it. Whether you think $20,000, $200,000 or $2 million is a lot of money, there are plenty of people out there who think that any of those dollar amounts is just a drop in the bucket for the right deal.
The bottom line is, don’t let your mindset get in the way. There is so much cash looking for places to be invested that finding the money is actually the easy part. Finding the deals is the harder part. You can find people who will write you a check for $2 million for the right deal.
If you’re going to do the work, just do the work once and then get it to work for you forever. Direct your energy into finding other people’s money and putting it to work for you. Part of all of this is rising above your doubts and fears and projecting positive energy to your investors.
We live in an attention deficit age where you have many things pulling on you and demanding your time. As a result, you lose focus and things slip by the wayside and don’t get done. If you have a Performance Dashboard in place, you will have something to help you move forward with your goal of financial freedom on a daily basis.
The beauty of the Performance Dashboard is that you can create one for your business, and your personal life. You have the flexibility of setting up the Performance Dashboard to accommodate your individual needs but here are some ideas for row headings to get you started.
Your columns would indicate days of the week and each row would represent a critical activity that needs to be done during the week in order to move toward your vision of financial freedom. Here are possible headings with the data that would need to be collected:
Deal Finder for Single Family Homes: you would record your lead generation activity here with how many leads came in, how many offers you made and how many contracts you signed.
Multifamily: here you would note all activity related to multifamily units.
1. How many letters for 2-4 units went out?
2. How many letters for 5+units?
3. How many emails went out to new brokers?
4. How many emails to brokers?
5. How many leads came in?
6. How many were analyzed?
7. How many offers did you make?
8. How many contracts were signed?
Funding Finder: this would be where you would detail all information regarding your funding sources.
1. How many calls to new investors?
2. How many calls to old investors?
3. Were emails sent out to your investor list?
4. How many testimonials were collected?
5. How many networking events did you attend?
Goals for the Week: this one might seem unnecessary but it is extremely helpful in keeping you focused. You need to determine what your goal is for the week. Is it to send out 200 letters for multifamily deals? Maybe it’s just getting 5 calls for a multifamily deal. The important thing is that you have goals listed.
Once you meet your goal, check it off. You don’t need to do anymore for that week. Establishing a “finish line” is important and you need to stick to it. Once you have accomplished your goal then work on other areas.
The great thing about the Performance Dashboard is that it is portable. It’s a great way to keep track of where you are for the week. You can quickly assess what goals have been reached and what goals haven’t. You can take the appropriate action to complete the goals that haven’t been met.
We’re all familiar with the saying “It’s too good to be true.” Sometimes, that’s what you encounter when presenting deals to investors.
Hear one student’s comments regarding how to address the skepticism you might be faced with.
“The example you gave yesterday about the deal with the investor, how they were uh, how their money, their investment, the initial investment was protected, the 800,000 – with that ratio because I’m in the residential real estate and that to me, going to an investor and saying “Look, based on what else is out there right now, you’re, look at your investment. You’re protected by this big of a cushion.”
It’s just like you said, just like you said yesterday; it’s like they’re going “So, what’s the catch?”
You’ve learned how to create a real estate business. But at the same time, you want to create your net worth. The steps to getting this done are a 5-step process. Not only can you apply this process to your business, but you can apply it to your personal life.
The five steps to Getting it Done are:
1. Define what role you will play
2. Establish your vision
3. Create your storyboard
4. Create your plan
5. Create your performance dashboard
Defining your role: The roles that you can play in your business are that of bird dog, wholesaler, rehab and retail properties or rentals (income) properties. The more focused you get in defining the role you wish to have, the more effective you will be. Don’t try to do everything or you will get distracted and bogged down by stretching yourself too thin.
Establish your vision: Your vision is your reason “why”; why you are creating your real estate business. Make this a “three-year” vision. Ask yourself where you want to live, what do you want to do and what do you want to have over the next three years. This timeframe is long enough to keep you focused and energized.
Create your storyboard: This is a physical representation of what you want your vision to be. Your mind thinks in pictures so keep this board in front of you everyday. Cut pictures of your “dream” items out of magazines. Post pictures of properties that you have closed on.
Create your plan: What is the sequence of steps to get you to your three-year vision? What are the milestones along the way? Create a storyboard that steps out your plans all along the way. Define the action steps that must be taken in order to reach each milestone.
Create your performance dashboard: This will be your daily and weekly “scorecard” of how you are doing in accomplishing your goals. You will be able to see what goals you haven’t met each day and each week.
Once you put this five step process into place, you will be able to “see” the big picture and more effectively work your business. As you progress and begin to achieve goals that you have set for yourself, you will begin to realize your dream of financial freedom.
When you present a potential investor with a deal, probably the number one thing running through the investor’s mind is how good the deal is and how good the person running the project is. This is why you need to have a credibility kit for your deal and a credibility kit for yourself. The bottom line is that you are what the investor is evaluating. You need to know what to include in your credibility kits.
Credibility Kit for the Deal
This is where you fall back on your deal structure sheet. You need to use the features of your deal to build credibility. You could have the property information packet, flyers, pictures of the property, and a summary of the attributes made available for the investor. Not only does this build credibility for the deal, but it builds credibility for you and it is another way to prove that you have thought through the process for the investor.
Credibility Kit for You
Starting out, you will need to collect referral letters or recommendations from whatever occupation you are in right now. Don’t hesitate to include problems you have overcome, and projects you have completed – even ones that don’t involve real estate. Everything you have done adds value so be sure and be thorough.
As you gain more experience, you can make it more real estate specific. You can include trainings you have participated in. Be sure and include any clubs and associations you belong to. Also include any volunteer work that you do.
If you have gaps in your experience, you need to “borrow” experience. You can bring in partners and get testimonials on your partners. Testimonials on your contractors could be included as well.
Testimonials can be extremely powerful. You need to be sure and build in testimonials from everyone who is satisfied with you into your credibility kit. Get their permission to use it because this is an influential marketing tool that doesn’t cost you a dime.
You can start by carrying a notebook with your testimonials to show people. You don’t have to go to the expense of a website. That can come later.
Photos are also very effective. Include photos of properties that you have rehabilitated as well as a photo of yourself in flyers that you hand out.
The importance of building credibility cannot be stressed enough. Your reputation is at the heart of what you do and it will build with each deal that you close. Your credibility kits play a significant role in getting your name out there.
What do you do if the bank won’t allow you a second mortgage?
Listen to what Jennifer, a student of Lance’s, has to say:
“I liked the concept where if the bank is not going to allow the second mortgage, then you use your stock in your LLC as collateral. That was a nice tool.”
“Always be prepared” is the Boys Scouts motto. And that motto can be applied to what you are doing as well.
A student of Lance Edwards’ observes:
“I really like the…having this extra Master Lease concept in your quiver. Probably you won’t want to use it often but it’s there for that case, that instance where you go “Oh, now what do I do with it?”"
You don’t have to spend a gold mine on your marketing strategies. In fact, there are some very effective ways to market your multifamily deals and not spend a dime doing it. Let’s take a look at these free marketing strategies.
The most effective marketing strategy you have available to you is your referrals. This strategy that is used throughout the business world is also applicable to what you are doing. Referrals are absolutely fabulous at bringing in new investors.
Another free marketing opportunity is helping out at a charity fundraiser. You are able to get in touch with people that have money and money that they are looking to invest.
Good old-fashioned networking is another free marketing method. Network with fellow members at clubs you belong to. Reach out to those people that are in your focus groups.
Another method of free marketing that is sometimes overlooked, is spying on your competition. Find out where they are getting their money and how they are funding their deals. Use your network to do this.
All of the strategies mentioned above are effective and cost you nothing. Take advantage of these strategies and put them to work for you. You will be pleased with the results and at the money you save.
There are many facets to marketing. You want to be sure you target market. The more you can target market, the more precise you can get with your benefits and the more likely you will find buyers and investors.
Here are some possible target markets:
* People looking for retirement funding
* People that need income or more income
* People looking for more passive income
* Nurses in real estate
* Women in real estate
* Teachers
* Realtors
The list can be endless. The only limits are your imagination. Be creative and don’t hesitate to think “outside the box”.
If you have colleagues, don’t forget to include them. If you have associations with other groups of people such as those who share a hobby or past-time with you, you can possibly count them as well. If you sit on the board of an organization, you might very well have potential investors there waiting for an opportunity such as yours.
Remember, define your target market and then focus on relating to why they need the money. The more you can emphasize the benefits of your deal, the more you will be able to grab their attention and be able to sell them on it.
It’s amazing how simple changes can greatly increase your cashflow.
Here is one student’s “Aha Moment” on how a slight rent increase affects cashflow.
“$10 per rent increase and it gave you such an incredible increase in total, you know, cashflow.”
SECURE AND CONFIDENTIAL