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Use of Paperwork as a Real Estate Investor
One of the things that can strike fear in the heart of the novice investor is the idea of doing paperwork. Call it lack of familiarity or just fear of fine print, but this issue can be very intimidating and it also can have a big impact on your perception with others. Your clients will expect that you have some basic understanding of the paperwork you present to them and the alternative of just running everything through an attorney can get expensive real quick so where does that leave us? I suggest a happy medium and that medium is the subject of this article.
Paperwork Overview
Let’s start with a basic overview of what it means to effectively use paperwork in a real estate transaction. Unlike other commodities, real estate can be structured and greatly leveraged when you have a strong command and understanding of the paperwork with your deals. This is also why paperwork is sometimes intimidating for most people. However intimidating it may seem to you or people you do business with, it is imperative that you strive to fully understand the paperwork you use. The good news is that having a thorough knowledge of paperwork is something that can be simplified and that can be learned over time.
As far as simplifying paperwork, my basic suggestion is to create packages of forms for each type of deal you commonly do. For example, subject to deals vs. short sales.
The hard way is to obtain a new client, scramble around feverishly to gather and print the forms you’ll need (hoping you don’t forget something), and then go meet with them. The easy way is to get the same phone call, grab a packet of pre-prepared forms off your shelf, and go. Which way seems easier to you? Which way will be less stressful? I think you see my point. Beyond that, let’s discuss this further by highlighting the three main kinds of paperwork you’ll need.
- Paperwork with sellers (purchase contracts)
- Paperwork with buyers or tenants (sales contracts, leases, etc.)
- Supporting paperwork
Purchase Contracts
First of all, remember that I don’t say the words “purchase contracts” with anyone I do business with. Instead, I say, “this is the piece of paper that says you are selling and I am buying.” This is less threatening to the other party. For some reason, the word “contract” scares people.
The types of purchase contracts you may wish to use for your deals may vary considerably and I’m not one to hang my hat on one in particular and suggest it will work well in any situation. First, I’m not in a position to rightfully do so, and second, it just wouldn’t be fair for you to be thinking this is the way to go. Every situation is different and your choice of contracts should reflect this. Some basic choices to consider include the following:
- A formal Realtor contract
- A private contract that is “full-length’
- A private contract that is intentionally short
When selecting a purchase contract, remember that beauty is in the eye of the beholder. It’s not just about what you prefer to use; it’s also a function of what the recipient will think. For example, you may have learned the business from someone who subscribes to the theory that you should use your own paperwork at all times. This is a decent theory but what happens when you want to pursue listed properties such as a bank repossessed property? Realtors will often avoid and discourage contracts they are unfamiliar with so you need to be prepared to use something that is not your own for certain situations.
I tend to have a more liberal view of contract selection and can easily adapt contracts that aren’t from my own ‘library’ by adding certain key addendums if necessary. Addendums to consider might include a right to show, right to assign, or a right to inspect the property and can include whatever you want to include. In this way, any prohibitive features of a foreign contract can be “undone” by the addendums you choose and make the contract more like one you would more normally use. Keep in mind that too many addendums and contingencies in a contract can and will very often kill a deal because it scares the other party away. Keep it simple and only add when necessary.
Some sellers are accustomed to receiving contracts that are of the full-length variety and might object to something that is unusually brief. That said, for simple transactions like cash purchase wholesale (contract assignment) deals, a brief contract is all that is really needed and you can sell the simplicity to your clients as a reason why you are easy to work with. This can add integrity in the right situation. For other more traditional deals, even the simple addition of addendums or specific terms can show that you are on the top of your game and give you a defined amount of professionalism.
In my next post, I’ll discuss contracts with buyers/tenants and supporting paperwork. By the way, you can see all the paperwork I typically use as part of my FREE gift to you. Just click here
www.freemakemoneygift.com/Invitation.html
Meetings with Your Real Estate Team and Partners
Meetings With Team Members
Meetings with team members are less frequent than other meeting types but are no less important. I think these are some of the easiest meetings to work with, because you can have a set agenda and expect that it can be followed with little deviation. For example, you schedule a meeting with your realtor to discuss a new market niche you want to pursue. While you aren’t exactly sure what the meeting will produce as a result, you should have a pretty clear idea of what you are going to talk about and that will make the meeting go easier.
When meeting with team members, let them know in advance why you are meeting and how long you expect the meeting will last. This is referred to as the meeting before the meeting. Ultimately if you want your meetings to be successful then the appropriate parties should know what to expect. This allows them to prepare and also is respectful of their likely busy schedule. As far as meeting conduct goes, be sure you are on time and, minus a little friendly chitchat, keep things on task so nobody feels like their time is being wasted. I suggest also summarizing the meeting when it ends so each party knows the answer to ‘So where do we go from here?’ When you can do these basic things, your professionalism as a goal-oriented and organized entrepreneur will shine through and impress your team members.
Meetings With Business Partners
Some of you have formal business partners, some of you are married to your business partners, and some of you may simply be considering whether or not a partner is right for you. For many investors, partnerships can be good ways to capitalize on the strengths of the members and should result in more overall productivity. Some partnerships are simple relationships between a financier and an investor for a particular deal. Others are more detailed relationships, which impact the business on a more regular basis. Regardless, your meetings with them will have some similarities.
Chances are your association with a business partner has already been at least partially established so the whole first impression thing is less of an issue. However, if you’re in charge of getting something ready for a meeting or have progress to report on, then it is a good idea to have done what you were supposed to do. This is very logical but is also often overlooked. It is wise to make sure partners have proper accountability to each other and that each partner is comfortable with both receiving and giving opinions or criticisms as warranted.
Whatever you do, if you decide to operate with a partner make sure that you get everything in writing up front. Each partner should know at the outset of the partnership what the other person is accountable for. I’ve personally seen and been involved in business partnerships that have succeeded as well as those that have failed. Sadly, partnerships seem to end because one person is doing more than the other that in turn creates bitterness and hostility. Know your roles and do what you say you are going to do to the best of your ability. Another option you may choose to consider if you are unsure about establishing a long-term partnership is to create a partnership on a deal by deal basis. This way you are not locked in to any long term commitments to anyone. If you can’t or don’t want to be accountable to anyone then don’t go into a partnership. The good news is a partner is not at all needed to be wildly successful in this business.
As you’ve seen from my little discussion here, meetings in this type of business are critical to your success. Sometimes meetings are cut and dry, right to the point if you will. Sometimes they are speculative and involve a lot of brainstorming. Sometimes they are a mystery, giving you little advance notice of what to really expect. Regardless, your approach to meetings and ability to handle them will be a huge part of your business arsenal. Treat each and every meeting as if it was worthy of your full and undivided attention and your various clients will never be left feeling like they were a waste of your valuable time, even if the meeting doesn’t end up being as productive as you might have hoped.
The way to approach meetings is a lot like approaching a client for the first time. In an initial meeting, the first impression a client has of you will have a lot of bearing on whether they choose to do business with you or not. Similarly, a scheduled meeting is basically a continuation of that first impression a client has of you. You may have to use a little intuition or gut instinct to gather what their first impression may have been. Beyond that, you have a great opportunity with meetings to either:
- Continue a good relationship that started off on the right foot
- Right the ship if your first encounter with a client ran into some snags
When you are organized, attentive, task-oriented, and just plain personable, the general flow of most meetings will be in your favor. Clients know that you are meeting for a reason and, more often than not, they will be expecting that you will dictate the flow of meetings. Be prepared to run the show, have an agenda, and be ready to adapt as needed. When you can do these things, you will get the most out of meetings you have and your productivity will shine.
Meetings With Prospective Buyers
Meetings with prospective buyers are very exciting, as sales usually are what directly put money in your pocket. I suggest a few guidelines that will help you manage these kinds of meetings and also make them as productive as possible.
First, prescreen your buyer prospects over the phone. Countless time is wasted by investors showing properties to buyer prospects who are marginally or even poorly qualified. Especially now with tighter mortgage rules, you just can’t afford to drive across town to show a property twice a day to marginal buyers. Ultimately there are only two things you need to know about a buyer to determine immediately if they are a prospect or a suspect. They must either have money and/or credit. If a buyer has money then you can consider a lease option. If a buyer has credit then you can consider getting them a conventional loan. If they have neither, then there is virtually nothing you can do for them at this time.
In regards to letting buyers see your properties you also have two options. First, you can put a lock box on the front door and give people the code to go inside and view the property at their convenience. Second, you can drive out to the property and show the home to every Dick, Jane, and Sally that wants to see it. For me personally, the decision is easy, I’ve never shown a house and don’t plan to because it is not worth my time. I would much rather let someone show himself or herself in and out without me being there. You’re allowed to disagree with me on this subject, but before you do, I recommend you try this system (which is exactly what it is, a system) before you completely knock it. If it is going to keep you awake at night wondering if someone might steal something then don’t do it, but again, what is the worst that can happen? So they steal the fridge (the odds are against it) so what. The only thing I had someone take were the plug in air fresheners I put in the house. Imagine that, air fresheners! They must have really needed them.
So why operate this way? Well, aside from saving you hours and hours of time, believe it or not, it relays a sense of integrity with the way you conduct business. People appreciate the ability to view a property without someone breathing down their neck. Believe me when I tell you, nothing says ‘I’m desperate to sell this place’ like you herding a client through a property and asking them if they like it five or ten times. A client will make their own decision anyway so just let them do their thing. After they’ve seen the house all I ask is that they call and let me know that they’ve locked the house up. At that time I find out what they think. If they like it then we meet and reach an initial agreement. If they don’t then I just saved 2 hours of wasted time. Buyers like this system and feel a strong sense of initial trust with you because you are showing professionalism and trust with them.
Lastly, don’t be afraid to call these buyers to action. This means scheduling a meeting with them and ultimately collecting a good faith deposit. Take the bull by the horns, handle the follow up’s proactively, and your success will increase. The follow up aspect, a subject of another time, also displays to others that you take this seriously and will act accordingly.
So, why not take the bull by the horns right now and accept the gift I’m offering to you today to start serious real estate investing? Look for yourself here:
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Holding Client Meetings as a Real Estate Investor
I think it’s safe to say that you are well on your way to being more informed about the reality of operating a real estate investing business. Over the last several weeks, I’ve covered much of the basic mindset; skills and traits that you need to have, and now would like to move into a sequence of chapters that addresses more of the operational side of your business.
Operations in real estate investing include things like client relations, customer service, transactional processing, accounting, and fundraising. Since these factors are critical to the growth and stability of your business, they are worth mentioning on their foundational merit alone.
Let’s start by discussing the all-important meetings that you will be having with clients. Meetings with clients occur frequently in this business and it should not surprise you that these meetings will largely reflect your professionalism. Some of the basic kinds of meetings you will experience on a regular basis include:
- Meetings with sellers
- Meetings with prospective buyers
- Meetings with team members
- Meetings with business partners
Since you are operating a very dynamic kind of business, one in which two of your “work” days are likely never going to be exactly alike, it is hard to point to a single strategy for each kind of meeting that will work for you each and every time. This ‘moving target’ nature of real estate investing makes it a very exciting business to be in. It can also make it a challenging one to get accustomed to, especially when you are new to the business. For this reason, I will discuss each of the listed meeting types and what you should be trying to do to get the best outcome and results from your efforts.
Meetings With Sellers
When most real estate investors think of meetings, they will envision going to a new property and seeing if it meets their criteria for a profitable deal. This breeds natural excitement and also some apprehension, especially when one is new to the business. I think a very common pitfall for the novice investor is putting too much pressure on oneself when meeting with sellers. This isn’t rocket science. Take it easy on yourself and not only will your stress level go down, but also your meetings will be more productive.
The tendency is for the novice investor to think they must try to ink the deal on the spot during that initial meeting with a client. Does this happen? Sure it does, but you don’t need to put pressure on yourself to make it happen each time. Let’s review some of the basics with a little quiz. Your primary mission in a meeting with a seller is to:
a) Gather information
b) Get a feeling for how motivated they are
c) Develop good rapport with the client
d) All of the above
As you might expect, the correct answer is (d) all of the above. Your primary mission is not to ink a deal, although if circumstances call for it, you should always be ready, as this is your number one objective. In the majority of other cases, your mission should be to learn what is going on, why they may be motivated to do something, and make yourself positively memorable to the client. When you do these things, each and every time, your meetings will be a success, and you will also spend far less time and energy worrying about trying to get contracts signed on the spot.
Please note here that I am not openly discouraging you from being expeditious about getting good deals put to contract, because time is often of the essence for the great deals that are out there. Don’t spend so much time thinking about inking a deal that you lose sight of the other important parts of a successful meeting with a seller.
You can perhaps thank the real estate trainers out there for making everyone think they should always be ‘Johnny on the Spot’ when it comes to working with sellers. I simply find that good basic communication is a constant and better focus area for you as you are getting started. As you grow in this business, opportunities to act on the spot will appear so be patient and don’t fall into the trap of thinking it works like that all the time because it just isn’t so. Many of your best deals will come from following up and patiently working a deal, rather than trying to be unnecessarily pushy. You will also be viewed as more respectful if sellers don’t feel you’re trying to rush them into a decision they may need some time to think about. Just remember that time and circumstances often changes people’s minds so always leave the door open with clients.
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The Workplace of the Real Estate Investor - Part 2
Essential Office Components
Regardless of location, an office or other place of doing business for your real estate investing will require a few essentials. The list below is not intended to be all-inclusive but does feature the most important things you’ll need, based upon my experiences.
- Computer (desktop or laptop. Personally I prefer Mac vs. a PC)
- A dedicated work desk
- High speed Internet access
- Mobile phone plan with plenty of available minutes
- Local phone line
- Business cards
- Organized and readily available forms and paperwork
- Printer (color is ideal)
- Fax machine/scanner
- A dedicated business mailing address (P.O. Box or UPS Box)
- Dedicated email account
- Business website
- Accounting software
- File organization capacity for different projects/deals
Note that the list above does not include basic office supplies, as I think the need for these should be apparent.
Other Helpful Tips
To help with the proper balance between your business and personal life, I suggest having dedicated business hours. I appreciate that the business of being an investor can sometimes spill over into evenings and weekends and I’m not suggesting leaving these times off limits. Just have some definition to how your time is spent. For example, if you typically find the afternoons during any given week to be pretty slow, don’t take calls during that time. Rather, return calls during a defined time slot in the evening. You’ll be more apt to reach clients then anyway and you won’t feel like you’re a slave to your phone. Accessibility is one thing. Being consumed by your business is another and I believe strongly in a happy medium.
A well constructed website can also help alleviate any worry that you’ll potentially lose business during your ‘down-time’. Visitors can learn about you, submit inquiries, and request to visit with you during your normal office hours. The ability to set hours when you are working your business is not only healthy, but also helps you to appear more like a retail business that has set hours. This is especially helpful if you start the business as a part-time venture.
Let me reemphasize that I’m not suggesting any of you go out there and lease or purchase dedicated office space for your real estate investing business, even if that may become more relevant and necessary later. The most important thing you need right out of the gate is some dedicated place from which to conduct your business. I recognize that this may be challenging for many readers. You may not have that finished basement or spare bedroom that could serve as an office. In these cases, all you can do is the best you can.
Remember too the all-important issue of balance between your life and your business. A future as a real estate investor can be very exciting and also one that can be somewhat consuming. Between meetings, phone calls, and time online doing your research, the business (like any) has the potential to blur the line between your home life and work, especially when the business is home-based. Make the effort to find that right balance and, in the long run, you will be much happier and be able to truly enjoy the fruits of your business from the comfort of home.
The importance of a physical office is much less of an issue for either your professional team or for your clients. You of course will be going to meet them in most cases and you are more important than the perception of where your actual business is located. If you’re self-conscious about the ‘rattle trap’ nature of your home office, remind yourself that your clients won’t be coming to visit you there and that your true business results will come from who you are, in the eyes of those who will be evaluating you. Bottom line is, just get started at home and then work your way to an external office only if that is your desire and only if revenue can support the move.
Key Point: Make lots of money first before you make lots of changes.
The Workplace of a Real Estate Investor
The old saying goes that a man’s home is his castle, and beyond the medieval reference, I think there is still some truth to this in the modern era. The home is the most sacred of places, where one does not have to put forth their best show, can relax, and enjoy those things unrelated to work or business. That’s all well and good but what happens when a home-based business enters the picture? Things may get a little more complicated and it could impact your performance as an investor so let’s explore the issue of business workplace a little more.
You have a number of options for where to conduct your real estate investing business. Let’s look at the three main options: a dedicated office (purchased or leased), a time-share office and a home based office.
Dedicated Office
The dedicated office is a great idea for many investors but is also the most expensive of the options available to you. You’ll have to locate space to either rent or purchase, which can be a considerable expense in some areas, or at least beyond the scope of a start-up business. Dedicated office space also has no furniture, shelves, etc. and will require separate utilities. All of these things can add up pretty quickly and can thus be prohibitive for many new business owners, including real estate investors.
The advantage of a dedicated office is that your business has a separate location, and thus makes it easier to both separate work from your home life and also maintain personal privacy, with respect to your team and your clients. The latter issue alone is not enough to warrant a dedicated office, as a simple business mailing address is sufficient at first to give your personal life and address the privacy they deserve. Beyond privacy, a dedicated office is clearly a sign of credibility and will generally be seen as a plus to both team members and clients.
There is no need to rush into an office, however, in my opinion it is an essential step at some point if you want to take your real estate business to the highest possible level.
Therefore, if the move to a dedicated office seems warranted, congratulations! This decision is most likely based upon a need that is fueled by a certain volume of business. Basically, it should be a sign that things are going well and when the time is right to move to a dedicated office, you’ll probably know and should also have the revenue to support the move.
Time Shared Office
A newer office concept that is gaining popularity is what I like to call ‘time share’ office space. Here’s how it works. You lease the right to use office space at a particular location for certain blocks of time each week. In some cases, you can also pay a set fee and schedule the space when you need it, say for meetings or conference calls. This can offer the appearance of a dedicated office but without the cost and headache of having to manage it all yourself. As a real estate investor who will likely not need a full-time office right out of the gate, this may be a good option to consider. It also displays professionalism by having a formal meeting place to offer clients that isn’t a table in a coffee shop.
The downside to this option is that the ‘tenants’ at these part-time offices are usually not given storage space so don’t plan on being able to store all your files and equipment there. You’ll have the flexibility of office space but will likely still need office space at home for the rest of your business needs.
Home-Based Office
The home-based office is where I originally started and is without a doubt the most common starting place for the beginning real estate investor. There is no need to purchase or lease an office and it will require far less capital to equip the office when it is at home. Spare or reconfigured bedrooms are probably the most common locations for home offices, followed by finished basements, and nooks or extra space in an existing room in the house. The latter is the only one I really don’t favor, although I recognize that, for some readers, this may be the best current option.
When considering where to set up your home office, consider the following factors that are all relevant:
- You will spend time on the phone in your office and need peace and quiet
- Storage space for your equipment and files/paperwork
- Uninterrupted access to computers and the Internet are essential
- Lack of distractions potential distractions (TV, barking dog, crying child, etc)
I recognize that a home office is often something of an intrusion to the space and time dynamic for you and/or your family. You really need to be able to make or take calls when necessary and be able to access your computer at a moment’s notice so consider these things carefully. Having to go outside to do your calls or wait until your child is done surfing the Internet before you can use the computer will get old real quick, in the absence of a Plan B.
At this time you may also be wondering how to conduct client meetings when you work from home. Should you meet with them at your home office? I wouldn’t recommend it. To me, privacy is very important and you’ll be surprised how nosy some clients can be. Instead, set up meetings at any one of your many local offices such as; Starbucks, McDonalds, Wendy’s, etc. If anyone asks why you are meeting there, be honest. Tell them that you work from home and you like to keep your business life separate from your personal life. This is not uncommon nowadays, and as a result people will and should respect your honesty.
Next week, we’ll discuss all the physical components you need to run a successful office.
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The Appearance of the Real Estate Investor - Continued
Category 3: The Perpetual Wall Streeter
This REIA meeting classic is almost always someone you’ll see in groups of investors. No matter how casual the setting, there’s always some guy (no intentional gender bias here but the person in question is usually a man) who shows up in a pressed suit, tie, and the cufflinks to match. This choice of apparel is great if there’s an unscheduled board meeting but this is an investor meeting so let’s keep it real. I’ve seen persons dressed like this at REIA meetings and, admittedly, my first thought is ‘OK, at what point are they going to stand up and try to sell something?’ Maybe I’m incorrect in thinking that, but first impressions are what they are.
Here’s my recommendation. Keep the suit and tie for when you really need it. Neither other investors nor your clients are really going to expect that you dress that formally and it’s going to look funny more so than it will impress people. That hits on a good point. The perpetual Wall Streeter is most likely donning Armani to try and impress his peers, rather than for any other purpose. Nice attire is fine but it shouldn’t be what draws attention to you. Ultimately, what you say and do is most important and that should be the focus of those around you, rather than what you are wearing.
Category 4: The Focused Entrepreneur
Of all the categories I’ve described, this is perhaps the one you most want to aspire to become, should you decide that a subtle wardrobe shift or change of look is warranted. The entrepreneur is out there for one purpose and that is to do deals. They also carry a fierce independent spirit, and have disdain for what is status quo. Appearance wise, the entrepreneur may feature a modest amount of so-called ‘bling’, maybe wearing a nice watch but not overdoing it by any stretch. He or she is likely (by the numbers) an expatriated member of corporate America and probably shows their independence by a strict avoidance of suits and ties.
In short, the phrase ‘casual but nice’ will often apply to the appearance of the entrepreneur type. Nice pants or jeans, some type of shirt with a collar, quality shoes, you get the idea. The entrepreneur exudes a casual confidence by dressing the part. They know that it is not their formal attire, but rather their dedicated approach to doing business, that will attract people to them and they are right. Entrepreneurism is about a certain spirit and it is tangible enough where many people will notice. When you see this type of individual, give them a card and have a conversation with them. These are often the real movers and shakers out there and are usually good people to know. Their influence still has to be proven, as with anybody, but the way they generally carry themselves is a good start.
Beyond the basic categories, I want to discuss a few things further regarding your appearance that will be of immense help to you as you attempt to establish and grow your business. No one type of attire is perfect for all situations. If you know a client is a banker who is meeting you on their lunch break, you don’t necessarily have to put on a suit but make an effort to dress the part a little bit and appear a little more professional. That’s what they will be used to seeing and most likely will be expecting.
On the flip side, if you are meeting a client who lives in the country, a more casual approach is probably advisable. Show up in a suit in this situation and the client may think you’re there to sell encyclopedias. The bottom line is this, when you match a client in terms of your appearance, they will see themselves as being more like you. This establishes a silent level of rapport and can go a long way towards your success.
An accessory you don’t need in ANY meeting: cell phones
We all have cell phones these days so while it’s not unusual to be seen carrying one, leave it out of sight and don’t you dare answer it during a meeting. If you do you could be seen as unprofessional and disrespectful. Oh, and in regards to those blue tooth things for your ear, don’t wear it during a meeting or anytime you are not on a call for that matter. They don’t make you look important, they make you look silly!
What the pundits say about first impressions is dead on correct when it comes to your success as a real estate investor. Never forget that the investing community has had some bad press in the past few years and the public’s perception of real estate investors may be, at the very least, a little skeptical. Sure, the message you deliver is ultimately the most important thing and can be what helps validates your authority. That said, how you present yourself, appearance wise, can set the tone (good or bad) for an interaction with a client and can either make your job much easier or much more difficult.
Personally, I prefer for things to be as easy as possible and let others make the business more complicated than it actually is. How you dress and when you show up is a simple and yet critical part of how you communicate who you are to a client and that is an important part of your professionalism. I’m not suggesting that any of you go out there and change your wardrobe, just for the sake of your business. Simply strive to convey an image of confidence, success, and experience. This in turn should instill confidence in the client of your ability to get the job done. Therefore, “business casual” should suffice in all situations. Just be mindful of the importance of your appearance and you’ll already be a step ahead of the game.
The Appearance of a Real Estate Investor
I would like to have a little bit of fun with this subject, but don’t get me wrong here, the issue of your appearance is something you want to care about. The reason is that, in all my years as an investor, I’ve seen some very interesting approaches to this. With all of the different backgrounds you may have experienced before real estate, it’s a great chance to set the record straight on how I believe a real estate investor should present himself or herself, appearance wise.
First and foremost you need to know that there is no meeting where appearance is more important than your first impression with someone. The old saying, “you shouldn’t judge a book by its cover” doesn’t really matter too much these days because that’s exactly what people do, and I am just as guilty as you are. Therefore, however you decide to dress on a regular basis is up to you, just make sure that your first impression with someone whom you plan to do business is one that will promote future business rather than discourage it.
For starters, let’s discuss the four main categories of a real estate investor that you can identify by their appearance. Trust me, go to most any REIA meeting and you will see what I am talking about here. I’m not intending undue criticism to any of you if you read what is to follow, look in the mirror, and say ‘Hey, he just described me. What gives?’ I’m just compiling years of observation into a general guideline so go along with me on this and enjoy. I’ll list my categories and then elaborate just a little bit on each.
Category 1: The Shameless Pro
Category 2: The Average Joe
Category 3: The Perpetual Wall Streeter
Category 4: The Focused Entrepreneur
Again, there’s no right or wrong here. My opinions are just that and let’s just call it a combination of experience and an author’s prerogative. Today, I’ll highlight the shameless pro and the average Joe.
Category 1: The Shameless Pro
I refer to this type of individual in a little bit of a sarcastic sense because the so-called shameless pro just never knows when they are off the job site and in a more professional setting. You’ve probably seen the type of individual(s) I’m talking about. Your local REIA holds a meeting and a few guys show up, looking like they just finished a full day of hanging drywall. What’s the tendency here? It’s not a ‘Hey honey, look at those guys’, stick your nose up in the air kind of response. Rather, it’s a tendency to want to give them your card to see if they want more work. This is fine if they are contractors looking to drum up business. It is another if they are fellow investors because they don’t exactly look the part.
There’s absolutely nothing wrong with being handy or getting your hands dirty on the job site for some of your deals. That said, when it comes to meeting with clients or with team members, you also don’t want to appear like you just left the job site to go to the meeting. Not only does it suggest you have a bit much on your plate, but it also does not present an overall professional image. Clients want to see that you know how to handle their situation, rather than be the person an investor would hire to fix up their properties for them. To each their own, but remember you never get a second chance to make a first impression, and I suggest you make the most of that opportunity.
Category 2: The Average Joe
The Average Joe, often accompanied by Average Jane, is one of the most common looks you’ll see at meetings of investors. There’s nothing specifically wrong with this approach and it’s probably not something that’s given a whole lot of thought by people around them. Therein lies my point. The Average Joe does a fabulous job of blending in with the crowd and is probably a decent enough person to interact with to boot. They are also entirely unmemorable, especially if they are quiet and don’t say much.
A big part of the networking game is to stand out to people and be positively memorable. Whether it’s attire or, more importantly, what you say and do, you want people to remember who you are. The Average Joe, because of their tendency to blend in with their surroundings, must work extra hard to network and have people remember who they are. Their ability to blend is by and large a virtue of their casual dress and many investors who fit this category are also newbies. They may wish to blend in because they are new and are nervous about having to interact with people in a profession they don’t know much about yet. As long as they are able to eventually come out of their shells and be more noticeable, this is an OK way to start.
On the flipside, the nondescript nature of the Average Joe makes it easy for them to fit in and interact with clients. What they may lack in knowledge (for the less experienced investor), they make up for with natural rapport and they tend to be able to put clients at ease much easier than either the Wall Streeter or even the Entrepreneur. Basically, they’re just being themselves and, as long as they can convey the message at hand, this look is actually a pretty good recipe for success.
Wednesday, I’ll discuss the other two types of investors. In the meantime, check out the Incredible Free Gift that any investor can use to take business to the next level. Go to:
www.freemakemoneygift.com/Invitation/html
A True Passion for Real Estate Investing
On Wednesday, I discussed the passion of the real estate investor and the difference between passion and simple interest. True passion pushes you to dive deeper and go after results and to not be satisfied until you’ve achieved the goals you set.
On the flip side of true passion, is passion that is misguided. Make no mistake about it, passion for a business and what you are doing is different than passion for making money. I’ve heard many an investor who stated that money was their passion and that was why they loved this business. That is, in my opinion, a recipe for failure in the long run. If you truly love what you do and the foundational elements of your business, the money part will take care of itself. Falling in love with the outcome takes your focus away from the important things you need to be doing to get there and, at some point, can and will be apparent to those around you. In short, true passion for your business is seen as exactly what it is and will generally be admired by those who witness it. Passion for the outcome (in this case, making money) is often seen as something more sinister, something called greed. Be careful about what your passion is based upon because others will see it and may judge you accordingly.
Now, I’m going to throw a little curveball at you. I’ve talked about the elements of what it means to be passionate and how this can apply favorably to your pursuits as a real estate investor. Now, I’m going to put the brakes on just a bit and encourage you to be cautious about it. Say what?! Let me explain.
Passion, for all its benefits, can backfire if it disrupts the balance of what may be an otherwise healthy lifestyle. Sports passion can be great in some regards but ask the wives or significant others of avid sports fans and see what their take is on that same passion. Ask the same person what they think of their spouse or partner burning the midnight oil on work related stuff and never having time for the family. Ask that same person how much they enjoy their partner talking about nothing but business, no matter how excited they are about it. I think you see where I’m going with this. No business is worth alienating those close to you or putting your marriage at risk. Sure, there will be busy times with your business. Just make an effort to keep it real and your friends and families will appreciate you even more for that than for your passion.
Know that passion can and will serve you well in many areas of your life, including your pursuits of real estate investments. Your team will appreciate your passion and so too will your clients. The passion is, in part, what helps establish your credibility and makes people excited about working with you. That said, you need to have a life too. There’s nothing wrong with working hard and loving what you do. It’s sometimes hard, though, to flip off that switch and get out of “business mode” when it is appropriate to do so. For each of you, finding that balance between business and your personal life will be a little bit different and there’s no magic formula for how to do it. I just encourage you to strive for balance and, by doing so, you can indeed have your cake and eat it too.
So, I’m willing to share my passion with you and give you a jump start on learning everything you can about the world of real estate investing. Are you ready to feed that passion?
Go to: www.freemakemoneygift.com/Invitation.html
The Passion of a Real Estate Investor
What does it mean to be passionate? Passion has obvious connotations in the world of romance but also can be in reference to one’s general feeling about something. Passion is more than just heightened interest. It is a true love for something that you do or something that you follow or have interest in.
Having passion for a business pursuit may be something entirely new for you, especially if you’ve been in work environments that you didn’t really enjoy. That said, passion is not just something that you either have or don’t have. It can be developed, it should be developed, and, by doing so, you will only create more income and success as an investor.
First off, how can you tell that you are passionate about something? I think this question can be answered in several ways and the following list offers a few ‘tell-tale’ signs that passion is what you are experiencing:
- Seeing or discussing something that immediately makes you happier
- That something taps into your emotional side
- Discussion of something that gets you excited and energizes you
- Your heart rate goes up a little bit
- You look forward to (and even plan for) when you get to do or see something
- You love the idea of sharing that something with other people
Let’s first look at these ‘tell-tale’ signs in the context of something you may be more familiar with and then I’ll apply the same things to your business and you’ll immediately see the parallel.
First, let’s use the example of a sports team. Are you happy when you have the opportunity to see your favorite team play? Do you get emotional during games in which your team plays? Do you love talking about your team to other people, whether they are fans of the team or not? Does watching your team get your blood going a little bit? Do you make plans to see your team play, even if it’s just on TV? Do you want to share with the world and with anyone who’ll watch or listen that you are a fan? If you can answer yes to some or all of these questions, then it’s safe to say that you are passionate about your favorite sports team.
Note that there is a significant difference between interest and passion. Interest is a more passive and non-emotional attachment to something, while passion is much deeper. A lot of people are interested in sports teams but, comparatively, few are passionate about them. Business works in much the same way.
A lot of people are interested in business. Poll 100 people and ask them if they would like to own a small business (i.e. be their own boss). A majority would probably like the idea and would say they are interested in it. Ask the same 100 people if they are passionate enough about it to change their professional lives to do it, and you’ll likely see that interest drop off considerably. Passion is an extra gear that goes beyond simple interest and there’s just more to it. So where does it come from?
Think about it this way. If you are passionate about a sports team, how did you get to be that way? You weren’t born with it. You weren’t taught to be that way. It probably came from seeing other passionate fans and experiencing something valuable in how they approached following that team. In part, you wanted to tap into that energy by being like them and that’s how it starts. Business passion is much the same way. You are much more likely to develop a passion for what you do by seeing other investors with passion describe what they do and how they feel about their profession. In short, such energy can be infectious and can help instill that business passion in you.
Beyond where you get your inspiration, passion must be nurtured and developed, just like the business itself. Why are you passionate? What is your mission? What is it you most love about the business? What sides of us does the business bring out that you most love to see? These are the elements of business passion that you must understand and embrace for passion to be something that you truly have for real estate investing or any other business. When you can demonstrate passion, others will see it and also become motivated as a result. Much like a passionate sports fan or movie buff, others who witness true passion may not fully understand it but will admire the conviction and emotion that is behind it. In the context of business, this can be a powerful credibility booster.
Passion can be reflected by exuberant discussion and giving off that intangible ‘vibe’ that you really care about what you are doing. That is the truest form of passion for your business. When your passion is based upon the love of the process this will greatly attribute to your ongoing success. For example, when you love interacting with clients, seeing their faces when you are able to present a solution to them, watching a distressed property become something better, and love seeing everyone win in the end, that is true passion for what it means to be a real estate investor. When you love these things and it shows, you demonstrate a true passion and people will respond to that.
I can honestly say I am passionate about real estate investing. I had to learn so much, but the passion I have for buying and selling property has afforded me the endurance to stay committed to learning as much as I possibly can about the whole process. I don’t want to take for granted that what I have learned has given me so many opportunities to do all kinds of things including meeting really cool people in this business, make a decent living and have a successful, self-made business. That is why I share all I can with others who want to learn and have a true desire to invest. If this gets your heart racing a bit, then you have to take a look at my offer, here:
www.freemakemoneygift.com/Invitation.html
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