Sheet 1
Accelerated Investor Pro Mastermind: Private Money, Notes, Mortgages, IRA's and Company Set up LLC's and Corps w/ Josh
  www.xmind.net
    mind map software free downlaod
  DISCLAIMER / DISCLOSURE
    i am not a attorney
    i am not a financial planner
    i am not a accountant or financial adviser
    Everything i say today is for informational purposes only
  The BIG QUESTION?
    why do real estate investors focus on sellers and buyers WITHOUT focusing on funding?
    serving private lenders first is the foundation for a winning business model and mindset
    giving starts the receiving process
    you biggest asset is your list of relationships
      its most cost affective
      easiest to break thru
  Private Placement vs Public Offering
  #1 Raise Money from People that I HAVE a prior existing relationship with
    Public offering versus a private placement
      3 touches & 30 days
        in order to make someone an offer
        this moves the offering from public to private b/c you now have a prior existing relationship
    A) NOTE
      10% fixed
        it does need registered
      10% fixed OR 15% of my profit
        it does need registered
          FORM D
          $100
          Rule 504, 505 and / or 506
        variable yield on note
      mortgage
        secures note to the house and is recorded at county recorders office
    B)
      Equity partnership
      Business
        LLC
          partner on deals
          Chuck finds the deals
          Josh puts up the money
          LLC
            50/50
            80/20
            20/80
            75/25
            65/35
      Joint Venture
      DOES NOT NEED REGISTERED / NOT SECURITY in most cases
    C)
      under 10
        Limited number of people/ investors
      over 10
        Private Placement Memorandum
        PPM
  #2 Raising money from the public / strangers or people we DO NOT HAVE a prior existing relationship with
    A)
      create a prior existing relationship
        talk about my deals
        talk about sample deals / examples
        without asking them for money
    B)
      Equity partnership
      Business
        LLC
          partner on deals
          Chuck finds the deals
          Josh puts up the money
          LLC
      Joint Venture
      DOES NOT NEED REGISTERED / NOT SECURITY
    C)
      so long as you are advertising partnerships/ joint ventures/ stock in LLC
    D)
      equity partnership
      LLC
      65/35
        shares of LLC
      100k
      40,000
      35%
        $13,666
          6 months
            $27,300 approx
          annualized return %27.3
      65%
        $26,333
  Lender or Partner
    Note and Mortgage
      Note
        I Owe YOU!!!
          who is borrower
          who is the lender
          what is the interest rate
          when is the interest due and paybale
            monthly
            quarterly
            annually
          Payback
            Examples
              1 yr balloon
              5 year Balloon
              10 year balloon
              simple interest
              monthly amortization
          my 40k flips notes
            12% interest OR 15% of profit, zero payments, all interest is due when the property sells and everyone is paid at the same time, 1 year balloon
          1st note
            60k
              18% interest
                5 year note
                  interest payable annually
                    $10,800
            90k
              10%
                5 year note ballon
                  unsecured
        promissory note
          promise to pay
        contract with the lender
        Equity Participation Note 8575 Melody Lane Macedonia Ohio 44056 1st mortgage Pete Vagt 60k 12.27.2012 clean 2nd draft with notary FINAL.docx
      Mortgage
        security
        collateral
          anything to back a note
          anything as a basis of repayment
        gets foreclosed on in event of default
        8575 Melody Lane Macedonia Ohio 44056 1st mortgage Pete Vagt 11.13.2012.docx
      Notary
        Mortgages
          DO have to be notarized
        Notes
          do not have to notarized
    partnerships and LLC's
      profit is in the NET INCOME after expenses
        example
          party (A) finds deals
            finds the house
              outousrces the improvements
            this is you / the real estate investor
          party (B) puts up all the money
            put up $200,000 and funds the LLC
          50/50 split of profit
          200k invested
            50k profit
              25k each
            200,000 returned to the operating acct
              25,000 distribution each
            buy a house for $150,000
            $35,000 improvements
            $185,000 used
            resell house for $275,000
            Profit is $60,000
              split 50/50
              30k each
            takes 5 months
            ROI
              200k invested
                30k returned
                5 months
                198.68 per day
                72,516 annualized
                %36.25 annualized return
      LLC
        Limited Liability Company
        limits personal liability
          if you run it as seperate company
            afforded same protection as a C CORP in ohio
        Flexibility
        members
        units
          a measurement of your ownership interest
          100 units
          1000 units
          standard measurement of how much you own
        single member LLC
          sole proprietor
        add partner
          multi-member LLC
            choose how u r taxed
              taxed as partnership OR Corporattion
                K-1 for taxes
        how to create an LLC
          legally recognized LLC
            fill out 3 page form
              name of co
              name of statutory agent
              signature
                can be signed by attorney as an authorized agent on behalf of company
            Mail to state with $125
      C Corp
        owners are stock holders
        annual corp filing requirements
        100 shares of stock each
          50 shares
            OWNER "A"
          50 shares
            OWNER "B"
        Double taxation
          taxed as "C" corp and pay double tax
          OR
          Elect "S" corp and pay yourself a salary
        Corporation pays it's own taxes on all net income
        Then any dividends or payouts to shareholders are ALSO TAXED
      S Corp
        In the event of an audit
          the officers MUST TAKE A SALARY
            should be approx 40-50% of what the business is earning
            take income in that year
              in december each year change some of the DRAW's to SALARY
          ELIMIATES 15% SELF EMPLOYMENT TAX
          Salary = W-2
          salary reduces the net income of the S CORP by the amount of the SALARY
        if you set yourself up as a LLC you can change the ELECTION!!
      partnership
        personal liability for the actions of the partnership
        K-1's are issued to partners
      Land Trusts
        SOCIAL STIGMA
          mechanism to commit fraud
          many people used them to commit fruad
        frowned upon on ohio
      "Operating Agreement" states how the company is managed
        sets forth the agreement with your investor / partner
        contract with your partners
        level of control
        communicate the progress to all members of LLC
        shows that you are running your business as a seperate a growing business concern NOT just as a personal venture
        bullet points
          who are partners
          whats the goal
          how are profits distributed
          tax planning
        not public record
        can be amended very easily
        good idea to have annual review
        you should have a operating agreement even for single member LLC's
        EXAMPLE
          2 partners
            1 money guy
            1 guy on street doing the deals
            Operating agreement states who does what and what we agreed on
      equity partnership spreadsheet
        cover on Class 4
      no note or mortgage
        no fixed interest rate
  Self Directed IRA custodians
    iPlan Group
    Jill Banner
      CEO
    440-484-5566
    Coaching Class #3
      Live
      we will go thru the forms and documents to set up SD IRA's for yourself and your private money partners
  David Streeter
    dstreeter@demerlaw.com
    216-407-6644
    focus in transactional real estate
  What are your goals?
    Buy, Improve and sell?
      4 months
        buy fix and sell
      6 months
        buy fix and sell
      120 days
        at best
      thinking
        30- 60 days
          improvements
        45 days to close
          once a buyer is under contract
          bank loan
    back to back Closing??
    Rental? 3-5 year partnership
    tax Lien
      6 mo redemption
      1 year
        Option 1 = 18 - 24%
          guaranteed
        Option 2 = i get a house free and clear
      2 year
      3 year
  ROI expected
    rehab fix and flip
      15-22%
      Ex
        2 points up front PLUS 1 point per month
      Ex
        12% or 15% of profit - whichever is greater
    back to back closing
      2 pts
      2500 dollars
      whichever is greater
    rental
      7-11%
      single family
      apartment
      self storage
      monthly payments - must commit to monthly payments
    tax Liens
      6 - 24 months
        7-11%
    30-90 day money
      22-25%
      toughest money to get
        from a private money lender or a hard money lender
      buy it, put it right back on the market in its as-is condition
      short sales where we get an incredible discount
        house needs no work
      reo
        house needs little work
      fsbo
        house needs little work
      EX
        2 pts and 15%
    determine capital required
      1171 Gardner road
        PP $56905
          Bank Of America REO
        Improvements $25,000
          carpert, paint, 3 bathrooms, drywall, kitchen, landscaping,
          roof , siding,
        $81,905
        $4,000
        $86,000
        Launching June 2nd
        List Price 149,9000
        Sell Price 135,000
        Net proceeds 122,000
        Profit 40,000
  Sweet Spot
    Easy Money
      50k - 500k
        35 year old - 55 years olds
          "regular guy"
            medical sales
            banker
            engineer
            managers
            operations managers
            steel worker
            Air traffic controller
            mortgage broker
            old 401k
              SWEET SPOT
                old IRA
            new 401k
    Tough Crowd
      1M+
        = married to their financial advisors
        Stock broker
        Financial planner
        attorney
        special treatment
          access to private money managers who 1M< don't have accesss to
      Little Old Lady
        65+
          all they care about is SECURITY
        Son/ daughter
          manages their money
          the last thing the son daughter is going to do is put thier mom's money at risk
  Make 2 lists
    #1 list of people you already know
      Project 100
        they can refer
        they can cheerleed
        they can lend
      DiscoverYourSphere.pdf
    #2 List of places you can go meet more potential partners
      Golf Courses - Country Clubs
        $400 a month
      Chamber of Commerce
      REIA clubs
      Kiwanis
      Hondros
      Kids soccer games
      kids basketball games
      BNI
    Professional Financial Advisors / Investment Managers
      "Selling Away"
        Cannot Sell unregistered securities that their broker dealer hasn't endorsed
        22 page affidavit every year
      Securities dealers
      are not sources of leads b/c they cannot sell away
  Tell everyone about what you do "in a cool way"
    My Elevator Pitch
      Hey Josh what do you do?
      Well, I raise capital for real estate!
      My favorite
        I raise money for real estate deals. i raise money from private investors, i buy foreclosures and pay my investors a fixed double digit rate of return
      I own a bunch fo real estate businesses and i raise capital to fund projects. i work with investors and pay them a double digit rate of return
      BECAUSE ITS SUPER SEXY!!!!!!!!!!!!
      response
        oh thats great i've always wanted to buy a rental!!
        oh kind of like carlton sheets
        sounds interesting tell me more
    Develop 12 second Elevator Speech
  Create marketing collateral IE "handouts and mailers"
    JOSH DFY it's in AI members area
    Investment Highlights Document.docx
    Improving Communities Document.docx
    Neighborhood Flyer Document.docx
    IRA Vacation Flyer Document.docx
    Equity Participation Note 4034 Manchester Road Akron Ohio 44319 1st mortgage SAMPLE FOR PUBLIC 8.27.2012.docx
    4034 Manchester Road Akron Ohio 44319 1st Mortgage SAMPLE FOR PUBLIC 8.27.2012.docx
  Create funding powerpoint
    JOSH DFY it's in AI members area
    Millennium Capital Inv FINAL 5.2.13.pptx
  Create investor/ partner Questionaire
    JOSH DFY it's in AI members area
    Evaluation Document.docx
  Develop a system for tracking potential private lenders
    show google doc
    basecamp
    high rise
  Send out a monthly mailer to your list of physical addresses
    people you have a PER
    people you don't have a PER
  email your monthly mailer to your list of email addresses
    people you have a PER
    people you don't have PER
  Newsletter System
    3rd tuesday of each month
      newsletter is due
        1st draft
    3rd wednesday of each month
      newsletter is approved by josh
    3rd thursday
      newsletter is final and sent to printer
    3rd friday
      newsletter is mailed out to everyone on my list
    MAC - "PAGES"
    writer
      www.textbroker.com
      99copywriters.com
      99designs.com
      real estate commentary
        www.kcmblog.com
        dsnews.com
    designer
      www.odesk.com
    newsletters
      Millennium - September_2011_MH Edits 10-11-11.docx
      Millennium Apr 2013.pdf
      Millennium April 2012 FINAL 4.4.2012.docx
      Millennium Feb 2013.pdf
      Millennium July Final 6.28.2012.docx
      Millennium Mar 2013.pdf
      Millennium May 2012 FINAL 4.26.2012.docx
      Millennium Newsletter June 5.24.2012.pdf
      Millennium Nov FINAL 10.24.2012.pdf
      Millennium Sept PDF FINAL 9.9.2012.pdf
      September 2011 the millennium.docx
      Sharp Millennium FebMar 2012.docx
      Willowmere OM kyle garifo 10.31.2012.docx
      Mill Prop Prespectus Ashford Glen.pdf
      Mill Prop Prespectus Ashford Glen.docx
      Mill Prop Prespectus Marmore Ave 8.1.2012.docx
      Funding Opp-4166 Ardmore 9-28-11.pdf
PRIVATE OFFERING
PUBLIC OFFERING - must be a registered securities dealer - which we are not
" We partner with investors, where we buy, fix, sell and rent foreclosures and pay our investors a fixed double digit rate of return plus a equity partnership bonus on the properties we close!"
Hey my name is (FIB), I help my investors earn a fixed double digit rate of return plus an equity partnership bonus.
i buy foreclosures from banks, renovate and sell them.
i use private investors instead of bank financing because its fastest for me and much higher interest for my investors.