Cash Flow Guys Podcast

1031 is a tax savings tool that many Americans take advantage of every year.  A benefit to some, a nightmare for others.  Allow me to explain Before we get started…. I’m NOT a CPA or Tax Professional; the info herein is my opinion...wait, why do we say that?  What has ever happened to a non-CPA giving advice?  I have no stories to tell on the topic...if you do, email info@cashflowguys.com because I’m curious A 1031 exchange is a legal vehicle for deferring capital gains taxes. By electing 1031 exchange status when selling one property and investing in other investment properties, you get spared from capital gains taxes. (temporarily)  Why?  Because those taxes are deferred, not excused or forgiven… To get the facts on the 1031B program right from the Internal Revenue Service, go to irs.gov and search 1031 for further details. Let’s talk about deferment for a minute...  At the time of this recording, the US Debt Clock shows our current debt at almost 28 trillion dollars.  Our elected bottom feeders are about t

Currently, there is a Federal Eviction Ban in place until March 31st, there’s talk that will continue until September 30th and possibly beyond that date.   If you own income property as I do, such headlines certainly don’t help us sleep well at night, do they? Some of the people I have talked to recently are thinking about dumping their portfolios. Others are talking about allowing leases to expire and just keeping the units vacant until this blows over. Many buyers are beginning to second guess their decision to make a purchase until this blows over. Frankly, I think it's a great time to buy because never before have we had times so uncertain. Uncertainty breeds motivation in sellers. The biggest future challenge for buyers will be in obtaining institutional financing as lenders will likely pull back from lending on income properties. Now is a good time to hone your capital raising skills, you can do that at PrivateMoneyCrashCourse.com The eviction ban only applies to a portion of the population which seems

Turn key rentals continue to grow in popularity amongst beginning investors due in part to the belief that they are easier to acquire, manage and control. Although there are differing opinions on what is considered turn-key, it generally means that the purchase, rehab, and management as a rental is done by a third party instead of the individual investor having to do everything. While for many it's a realistic way to get your foot in the door to the world of investing the end results are often less than exciting. Ease of Acquisition:  Most people have a tough time putting deals together, they don’t have the time or desire to work their own seller leads.  To buy a turnkey rental you simply place a deposit and wait for your turn. The easier something is to buy, the more people are generally willing to pay for it.  This means that turnkey providers can often pack a hefty profit into each deal for themselves because people love the done for you model.  Such a practice means skinny margins for the end buyer. Profo

Knowing the appropriate time to make an offer isn’t something that most folks think about, however it is something that needs not to be overlooked. Putting out an offer too soon can often lead to instant rejection. Putting out an offer too late may cause the seller to think you are a tire kicker. Sellers often want us to make an offer as soon as possible, why is this? The urgency to receive your offer usually is because of one or two reasons, they are nervous about the selling process and want to get it over with as soon as possible OR because they suspect you might just be wasting their time. Have you ever been concerned about saying the wrong thing to the seller and upsetting or offending them? Does the thought of not knowing what to say to a seller make you a bit nervous? Everyone says to build rapport with the sellers, heck, I teach that too, but I realize it’s a huge challenge to build rapport with a stranger these days. Social Media, The Pandemic, and just plain everyday society make it more challenging

In this episode of the podcast, I explore the specific criteria that make for a motivated seller lead.  Too often we waste time, effort, and money marketing to unmotivated sellers who are not interested in selling to us. Instead, when compiling a list of people to market to, deep dive into the available criteria to come up with a formula that will lead you to discover motivated sellers. As you might imagine, motivated sellers are more receptive to selling at a discount and also are far more likely to seriously consider creative acquisition solutions. Something as simple as choosing to market to vacant properties instead of occupied ones can make all the difference in the outcome of your marketing campaign. I also announce the names of the two winners of the one-year free subscription to Propstream.  Don’t miss this episode there is lots of value.  If you want to sign up for a 7-day free trial to get motivated seller leads, go to CashFlowGuys.com/Data

Today is January 1st, 2021.  It’s a new year that also marks the end of 2020.  This means 2020 is behind us. Nothing good comes from reflecting back on the drama of 2020. There is no need to look back on your past, instead, let’s get focused on the changes we can make moving forward to better ourselves and those around us.  If you have bad credit or low credit as some say, start paying your bills and correct the situation. Call your creditors and work out a resolution.  If you can’t work through this one problem I guarantee you will fail as a real estate investor because you will certainly encounter greater challenges as an investor than negotiating with creditors. If you are saddled with credit card debt, stop using them today and begin paying them off as fast as possible.  Dave Ramsey teaches Financial Peace University which will make it simple to get out of debt if you are willing to do the work. If you are under-earning, stop overspending and focus on earning what you are worth. If you are not earning wha

In this episode, we are going to cover the old question of when is a good time to buy. Aunt Suzy doesn’t know… Social Media Lies... Brokers Lie... Wholesalers Definitely Lie… So who’s opinion do you trust on when is a good time to buy? How about your own?  When the numbers make sense and allow for a reasonable profit, then buy! For Rentals: Income minus expenses equals cash flow, if the end result is not acceptable to you, offer less for the property. Yes, you must allow for greater vacancy AND the time it takes to find well-qualified tenants who are financially secure.  Yes, you must figure in the cost of management because it’s a legitimate expense, even if you are brave enough to self manage. For Flips:  If the After Repaired Value (Verified by an appraisal) does not offer a significant profit after deducting the purchase price, repairs, and holding costs...don’t buy. Make your flip offer subject to an acceptable appraisal. Forget about what “the market” is doing or not doing….do the numbers as you see the

Meanwhile, while many people are spending countless hours lamenting over which catchy LLC Name, Logo style, and color they should choose for their real estate company, I have been busy building my business. How you might ask? By finding motivated sellers and marketing to those sellers right under the noses of any Realtor or Investor competition I might think I had. Here is how my day went...wakeup at 0630, make a cup of coffee, and get outside on the porch to experience the rising sun and calm surroundings.  I read the Wall Street Journal so that I can stay up to date on what’s happening in the world as it relates to financial markets and the psychology of the consumer. After all, while many people try to lie to themselves about how they are “not a salesman”, I wear that title as a badge of honor.  I am also a savage marketer...embracing it is what made me wealthy beyond my wildest imagination and what allowed me to retire to the paradise of the Florida Keys.  And for that, I make no apology. For me to earn a

Make no mistake, it's a brave new world, new situations come with new consequences.   Understand this….Buyers / Sellers / Realtors / Wholesalers / Flippers CAN be sued related to Covid cases impacting those they do business with.   There is no catch-all set of laws covering Covid and possible litigation that can come from it, each jurisdiction will be different (so far as we know right now).  There is so much unknown it is becoming ever important to start looking at ways to protect yourself from possible liability.   Remember, even though you might likely win your case, you will still end up wasting thousands of dollars and too much time defending yourself from such a lawsuit.   To begin,  let's talk about disclosure…Article 2 of the NAR Code of ethics addresses agents making proper disclosures…if you are an agent, might want to familiarize yourself with this again...what if a seller has or had covid? Do you need to disclose that? could you be sued for not disclosing that? Maybe…is the easy answer   What abou

Have you ever been told "you're not listening to me"   Have you ever felt someone you are talking to is not listening to you?   I notice this more and more every day in society, so much so that I wonder if anyone is listening.   Perhaps social media is to blame...   Maybe it's lackluster parenting skills...   None the less, not listening to other people is one of the biggest failures in communication that we experience in modern times.   I never thought much about this until I joined Toastmasters many years ago.    While a member is giving a speech, others in the meeting are specifically assigned to listen to them speak and count the bridge words, audible crutches, and so on.    For me, this became a very powerful lesson.   When we are interrupted by someone we are speaking with, over time it can become annoying, more importantly, it can become very distracting.   I meet people often who I can barely speak with because I am left feeling I cannot get a word in edgewise.   When lines of communication are shut d

Most Americans are in credit card debt, for many, it seems impossible to ever get it paid off.   Worse yet, a large percentage are focused on “Investing” while remaining in credit card debt at the same time.     In almost every scenario the interest being charged on the debt erases any net gains from money invested.   “Just pay it off” some say…but for many it's not quite that simple, but here’s a way to change all that.   In this episode I am going to show you how to boost your retirement account while helping other escape the clutches of credit card debt forever.   By following my advice in this episode you will likely enable yourself to earn returns far greater than you ever before imagined starting almost immediately.  Listen in to learn more.

In this week’s episode I will be discussing some of the major points of Joe Biden’s Tax Plan.   First off, most of the changes apply to those earning over $400k, even if you earn less than 400K you should know about these changes as they may impact your sellers and money partners.   Most of this info came from a YouTube video filmed by Ken McElroy and Ken Freeman (his CPA) which can be found at the following link: https://youtu.be/fsIYaFLYFpY   It's important to note that likely nothing will change in 2021 because of the time it will take to implement the plan and have it works its way through the legal system.   Corporate tax rates are currently 21%, The Biden administration plans to raise them to 28%, check with your CPA to see if this applies to you.   The Biden Administration also plans to increase the Marginal Tax Rate from 37% to 39.6% and add a Social Security tax to those making over $400k.   There is talk of a $15,000 First Time Home Buyer Tax Credit.  We will have to wait to see what requirements th

Recently, America was dragged through one of the most important yet volatile elections in history.   Never before has our country been more divided. One thing that we can all be sure of is that we will certainly see lots of change over the next four years.  Some will despise the change, others will embrace it. Here’s what really matters...Your future success depends on your ability to make lemonade out of lemons. Yes, we will see radical socialist agendas being pushed down the aisle and likely made into laws that favor tenants over landlords.  The good news is that it takes time to pass new laws which will allow you (the landlord) to prepare for compliance or allow you to sell and buy somewhere else. Eviction moratoriums will likely be extended, if this impacts you, learn the law because you might be surprised to hear that there are exceptions to this ruling.  If you have non paying tenants, go talk with them, and discuss solutions.   Our country will likely continue to see record unemployment as both small b

When markets are hot like they are now, many people find themselves getting outbid when trying to buy a house.  This is in part because many Americans feel that the opportunity to use lines of credit or to get loans to finance such purchases will likely go away soon or at least become more difficult to qualify for.  “Use or Lose” fear of loss feelings take over and cause some folks to buy even when it does not make sense. The news is talking a lot lately about the potential for a second wave of Corona Virus.  Many news outlets are reporting that there are a looming eviction and foreclosure crisis that will certainly play a part in crashing our economy. Uncertainty in the stock market has many investors taking to the sidelines by adopting a let’s wait and see approach. All of these factors have an impact on the current real estate buying cycle.  Even non-investors are scrambling to buy anything that hits the market in hopes of locking themself in now by buying while they still can. The most practical way to av

Like many Americans, my mailbox and voicemail box is cluttered by multiple sales offers to install solar on my properties. First, let me say I love the concept of solar energy, in fact, I have solar panels and a large battery bank installed on our motor home which allows us to remain unplugged as we travel the country. I was originally intrigued by the concept of solar on my sticks and bricks property until I learned the downside of installing solar on a stick and bricks property. I thought that it would eliminate the chance of power outages for my tenants, but quickly learned that’s not the case.  This is because of how the systems are required to be designed when installed on a traditional home. The system is designed to harvest solar energy from the sun and feed it to the power grid.  The power company then monitors how much power your setup supplies and pays you in the form of credits to provide them with electricity.  They then provide your home with power from the grid but only charge for what you use t

Interesting legislation is being proposed in Philly… First, Allan Domb is a Realtor and the proposer of this new regulation, big shocker there. This legislation would require a “Wholesaler License” and background check to look for fraud, dishonesty, deceit, or violation of ethics laws.   This means that many wholesalers better change their tactics; clearly, there have been some antics happening in Philly to draw attention to wholesaling.  When you focus on finding houses for buyers and NOT buyers for houses (playing Realtor) you can avoid scrutiny When wholesaling, make offers and not estimates of values, after all, your job is not to appraise the house, it’s to flip the contract. This new law is basically assuming wholesalers are misleading sellers about the value of their home, which is completely avoidable.  Instead of haggling back and forth on a purchase price, focus on only discussing the net proceeds to the seller, after closing costs and mortgages are paid (if applicable).  This way you are discussing

Real estate markets are on fire in many if not all, cities in the US right now.  When markets get white-hot, investors start rushing things and cutting corners to speed up the selling process. Before we get too ahead of ourselves, let’s review a few tips to make your renovation projects go smoother and avoid headaches. First, Always use licensed contractors and be sure they have good reviews and lots of them. Be clear on what the expectation is, prepare a specific statement of work.  This means you will list out each of the items to be completed by the contractor or vendor in a very specific way to include quantity, size, and color. If anyone discourages you from pulling permits for a specific job be sure to interpret that as a red flag and NOT a money-saving opportunity.  This is a common gimmick by unlicensed people who pretend to be legitimate contractors. When choosing colors, stay generic/neutral/ mainstream, don’t “experiment” or let anyone else do so on your behalf.  Be sure the colors you choose will

You’re excited, you sold your first property...there you are at the closing table spending that check you are about to be handed...then...POOF! No Check! Why no check?  Because you failed to be sure the buyer was qualified to buy the property you were under contract to sell. Failed closings happen every single business day all across America even though this is an easy to solve the problem. Sometimes, irresponsible real estate agents fail to insist on earnest money deposits from buyers and their agents.  Sellers often don’t know that a good faith deposit is something that should be insisted upon. Recently, two different Realtors in Arkansas tried to convince one of my students that they don’t use earnest money in Arkansas...yep, you heard it right, people just sling offers everywhere with no need to put any earnest money in escrow..ever. What’s interesting is that their state contract specifically addresses the procedures for handling earnest money, even though these two agents swear there is no such thing. F

Bay Lake Properties Tomahawk Properties Latin American Development & Management  RETLAW (Retlaw backward is Walter) Reedy Creek Ranch Lands was run by a guy named M.T. Lott (say the name quickly to get the joke) In 1955 Walt Disney has learned a powerful lesson upon the opening of Disneyland in Anaheim, CA by not buying a large enough parcel of land to build his theme park.  By the time he realized his error, neighboring parcel owners demanded a small fortune per acre to sell him more land because they felt Walt had deep pockets. In May of 1965 Disney started buying up land in the Orlando, Fl area to build what would later become Disney World.  Mr Disney was able to buy the majority of the land he needed for an average of $80.00 per acre.  He used Land Trusts to maintain the secrecy of the true buyer name.  Once word eventually got out, the price jumped up 1000% to $80,000 per acre.  Land Trusts are a great way to take title to a property while keeping the true owner’s information private.  Although not c

This 2020 and 2021 could very easily wipe out many Americans financially.  The good news is that you can choose to avoid getting wiped out. Our inner voice will warn us of bad things happening in the future if we allow it to.  For that to happen we need to be listening. Many investors feel pressure to get a deal done.  Many will overextend themselves financially, usually by overspending or under earning.   The pressure to not disappoint a wholesaler, Realtor or Seller by saying no or asking more questions can prove to be overwhelming for many.  Don’t let people pleaser tendencies destroy you financially by buying a bad deal. Maybe you want to get accepted into the cool kids club at your local real estate club by doing a deal you know you should not do. Fear of missing out on low interest rates or even the opportunity to get financed for a deal can cause us to make irrational buying decisions. Easy to get hard money loans make it easy to wipe out your life savings by investing in sketchy deals where not enough