What You Missed January 2017 General Meeting
by Rob Earhart

No More Banks

Larry Harbolt

January 3, 2017

“I have students across the country and some say there are no more deals out there,” Larry started with. He continued, “I know that there are deals everywhere but you have to look for them where others are not.”

Getting rich is going to take time. No matter what the GURU’s are telling you, it’s not a get-rich-quick program. They should be teaching, but instead are only promising to make you rich. You need a fundamental base to build on. “Understand the basics so you know what to look for in investing,” suggested Larry.

“I grew up in a town of 800 people in Michigan but we did not have a lot of money, so I had to learn how to make my own.” “I was a union pipefitter, a builder and a licensed appraiser but, 22 years ago, I left Michigan to make my start in Florida. No one in our family had ever moved more than five miles from where they were born, so it was an adventure,” he informed us.

Larry quipped, “My motivation was getting out of the cold and depressing area. I started doing real estate in the 1970’s while I was still in construction and did not have any money, so I had to get creative.” My key is I do seller financing with land contracts, where the sellers will accept time payments and, once payed off, they get the deed.

I still prefer to do it that way today, though I’m not saying to change what you are doing, but just open your mind to another way of buying.

I’m going to talk about either price or terms. I don’t use the MLS because everyone, as listed in there, wants cash. Sometimes getting all cash may not be the best way for someone to sell a property. They may want to decrease the tax effect by spreading out the payments. Income property is the least taxed since it’s long term because, if you have short-term taxes, you never get it back.

He instructed, “If you don’t like tenants, then just hire a management company to take care of the hassles, but with tenants, they are paying for your property.” We used to say you need 25 houses to be comfortable, but now we are suggesting 30 because of higher future expenses if you need to go to a nursing home.

If you cannot buy it, try to lease it with the right to sub-lease. “You do not have to own properties to make money,” Larry informed us. “You just have to control real estate to make money.”

Larry questioned, “everyone has to have a why; why do you want to do this?”

He continued, “Why is the MLS not a good place?” “Everyone is looking at the list so all you have are leftovers. You have to look elsewhere for the opportunities that others miss.”

At my bootcamp, I teach 10 ways to buy without money or credit, but once you get enough money, you can help others. “I want to provide for my family and still have enough to provide an endowment to my favorite hospital,” explained Larry.

The number of people who own houses spiked in 2005, but has dropped to 1965 levels now. We all need somewhere to live, either owning or renting.

What do investors do to become successful?

• They know what they are looking for and write a contract to hold them accountable
• They know how to recognize opportunities
• They know what they want to make from each deal
• They know how to get what they want

Instead of one big lump sum, I would rather get paid every month, such as 200 people paying me $200 per month. That would give me $40,000 and I could play a couple rounds of golf.

If you had $100,000, instead of buying one $100,000 house, you could put $10,000 down on ten houses with seller financing and could have a million dollars’ worth of real-estate.

We send letters to non-owner-occupied free-and-clear houses. My wife and I do 25 to 50 per week and I buy 3000 names at a time. Since they have no underlying financing, I can pay them off in bubble gum if they will take it. This is my entire marketing program.

You need a buyers list. Start here in SREIA with wholesalers that you can flip the contract to. You can also use bandit signs, Internet, newspapers, etc.

There are four things you need to know about every deal you do:

• What is the best use of the property? Highest and best use for that property.
• What will the property be worth after getting it fixed up? An appraiser can do a pencil list to find out the real numbers.
• What will the repairs cost?
• What’s the most you can afford to pay for that property?

There are four basic types of real estate:

• Bank owned, REO’s, etc.
• Houses you don’t want
• Houses you can fix up and retail
• Long Term Income properties

There are thousands of ways to make an offer on a property if you are not paying cash.

So I care how much I pay for a property if I could pocket $150 and the tenant is paying for the property.

Larry talked about some of the houses he put under contract, sold the contract and made upwards of $25,000 without ever owning the property. These came mostly from responses to the letters he sent out.

3 types of sellers you will be dealing with.

• Very motivated – These people are easy to deal with
• Somewhat motivated – You have to do more convincing
• Not motivated – This type is an uphill climb

You make your money in real estate during your negotiations. Don’t tell me what you won’t do, tell me what you will do.

Who is in control of the negotiations? The seller has one house to sell but the buyer has hundreds to look at. So just remember that you are in control.

How do you profit in Real Estate without money or credit?

• Wholesale deals for cash
• Lease, then sublease
• Lease option
• Trade deals for equity
• Subject to for non-recourse financing
• Get an option to buy, then sell on option for cash
• Trade stuff for equity for cash and cash flow
• Prepay several months for payments
• Memorandum for payments – 6 to 10 months with no payments
• Trade skills for equity

Larry then talked about his four-day bootcamp and how he would go over the many ways to buy for one entire day. His next one in Tampa is Feb 16-19th

“If you can learn how to think outside the box, there is no reason you cannot make a lot of money in real estate,” encouraged Larry.

He then talked about https://www.facebook.com/LarryHarboltEducation/ where there are podcasts you can learn from and www.larryharbolt.com is the website for his classes and more information.