http://www.bloomberg.com/news/2010-10-08/bank-of-america-extends-freeze-on-foreclosures-to-all-50-states.html

This is incredible.  I sense another bailout request rearing its ugly head due to this situation they have put themselves in.
It seems to me the only banks that aren’t worried about this potentially illegal or fraudulent foreclosure filings are the smaller community banks… you know, the one’s that don’t have any of our TARP money and are WAY more likely to be shut down by the bank regulators.  This is just one more reason we should not be propping up the “Too Big To Fail” banks.  They have no clue what is going on in their own organization.  How could any outside regulator possibly understand the complexities in these giant banks.  I think they are all wrought with fraud and illegal procedures that the public may never hear about.  I say “Bring them back down to a sensible size.”

We should be promoting more community banks, not less of them.

I recently wrote an article about this very topic right here on my blog.

The only reason the smaller banks are getting shut down every Friday is because no one helped them out with TARP money.  If they were able to get access to some “FREE” money just like BAC, PNC, ALLY/GMAC, and 5/3rd. etc., we wouldn’t already have 129 failed banking institutions in 2010.

Go read the article on Bank Of America halting their foreclosures and then leave a comment below or click here if you don’t see the “Comments” section and then scroll to the bottom of the page.

Technorati Tags: Bank negotiation, Bank of America, Foreclosure, Foreclosure prevention

This is me writing to you because I’m genuinely concerned about where we are heading.

The other day I let you know about a report that I’m offering to folks looking for commercial real estate funding or business funding.

Even if you are not looking for commercial or business funding, I would recommend checking it out.  I think you will get some great ideas even for a residential loan request.
I can not help you right now with funding on residential (I’m working on it though), but I think it has some great ways to help you out, just translate it to what you want funding for in residential and then take that to a local community bank, private lender or hard money lender.

http://GetCommercialFundingHelp.com

Leave some comments on my funding blog once you have a chance to look it over.
Go to the first link up there for the report and then leave your comments at the second link.
Please Leave Your Comments over here
http://myrealestatefunding.com/blog/commercial-real-estate/who-else-wants-to-know-how-to-get-your-commercial-real-estate-loan-request-approved
____
Now, back to my “Decision Time” subject.
Why decision time?

118 bank failures this year.  It’s only Sept. 3rd!!!
Last week the FDIC took a break from the shut downs.
I would not be surprised if they take a break tonight either since it’s a holiday weekend.
If they do, watch out next week bankers!!!
I heard from someone very close to the financial “Experts” the other day that over 1012 banks are on the FDIC watch list right now.

That’s after we had
2008 – 25 failed
2009 – 140 failed
2010 – 118 failed (and still counting)

Still over 1000 on the watch list?  Ouch!! That is a big number considering there are only 7932 banks insured by the FDIC.
To be sure, no one really knows how many are on the “Watchlist” exactly except for the FDIC and it’s cronies.
Compare today with the S&L crisis from 1989-1995 – 747 “Resolved” or closed thrifts with over $390 billion in assets.

We have 283 closed banking institutions in our current crisis and it is FAR from over.

Don’t believe me, here is the FDIC failed bank list.
http://fdic.gov/bank/individual/failed/banklist.html

This is a very interesting article written in the Wall Street Journal two years ago on Sept 17, 2008.  It discusses the crisis as it was unfolding then and what the writers believed should be done about it.
http://online.wsj.com/article/SB122161086005145779.html

Here is the wikipedia article documenting the S&L crisis of the late 1980′s.
http://en.wikipedia.org/wiki/Resolution_Trust_Corporation

Well, listen, the world is not going to end today or any day soon if you don’t get in to Bulk REO.  I firmly believe this is a great opportunity for right now though based on our current economic environment.  You need to be buying as low as possible and offering either very competitive rental rates or very competitive wholesale prices to the rehabbers in your target market.  I can’t think of any way to do this consistently or more efficiently other than through Bulk REO.

To be VERY CLEAR here.  Like anything in life that’s worth ANYTHING, this takes WORK!!  Your banker is not just going to roll over and hand you the keys.  You need to know what to say to get them to talk.  It takes negotiation skills too, but you use those everyday anyway right?  Wouldn’t you rather negotiate one big package rather than one individual house?  Your efforts will pay off MUCH better.

Let’s also be clear about THIS.  NOBODY is paying retail anymore.  We have too much inventory everywhere.  Housing starts need to stop until existing inventory is absorbed by the marketplace by new households, new families, people moving back out of Mom & Dad’s place, etc.  So, if you want to make anything, you need to be buying stuff on the super super cheap.

If you are looking for a way to really make an impact in your real estate business, then this might be what you are looking for.  There is no doubt in my mind that banks need the help of smaller investors to come in and help them dispose of blocks of properties quickly.

If you could pick up 10 houses for even 60% of their “As Is” current value, meaning you already have a 40% discount even if a rehabber was to buy it from you to fix it up, do you think that would help?  There are ways to slice and dice bigger packages into smaller packages, basically wholesaling packages of deals to small investors that want to maybe pick up 5 or 10 houses to rent out.

It’s like you being the wholesaler to Costco or Sam’s Club.  You sell to them in bulk, then they sell at a discount in a little less bulk to someone else. It’s called the Distribution Channel and it’s a necessary part of any business.  You can become one of the links in the distribution channel or you can continue to be toward the end of that channel.
It’s up to you. The banks go ahead and list properties all day long for 90% of As Is value.  They don’t sell… they sit there forever unless a homeowner comes in and thinks they are getting a great deal.  Bulk REO is the way for you to tap into the “Shadow Inventory” that the bank doesn’t want to put on the market yet.  They don’t want to flood the market.

In many cases they don’t even want to take title to the property.  That’s where you get into non-performing note buying as well.
The reason they don’t want to take title is because then the bank becomes liable for anything having to do with the property.  I’m totally serious, I have had banker’s tell me that is what they are doing.  One that I dealt with had 30 houses in one portfolio of one owner.  The guy defaulted on all of his mortgages and was still taking money from people in cash for their first month’s rent, then he would disappear and not pay the bank.  No background checks, no application, nothing, for ALL 30 houses.

Imagine what those houses looked like when the bank started to investigate!!!!

They were a total train wreck.  The bank did NOT want the responsibility of those houses.  They were all in deplorable condition.  We could not come to terms with them because the trustees at the bank couldn’t swallow the loss that we were wanting them to take.  Not sure what is going on with those right now.  This happens every day of the week.
If the bank doesn’t take title and they just let it sit there, vacant and deteriorating, the mortgage holder stays on title and is technically still responsible for anything that happens at the property.

But I digress. Earlier this week I told you about two options that you have out there to learn how to do this.
I’ve taken enough of your valuable time today, so briefly, here are some highlights about the two programs I told you about.

My friend Susan has her Bulk REO program.
http://MyBulkReoSecrets.com

It’s a solid course and is less than $200 right now.  (This could change at any time, but as I write this e-mail, on the morning of 9/3/2010 it is still under $200).
Susan believes in empowering you to go out and do this stuff on your own.
It’s very much a do it yourself program and she shows you how to find the packages and how to find people to buy Bulk packages from you.

It’s possible that you want more than what she has to offer.
Download her report at that link up there and then compare for yourself what Kenny has put together for you compared to Susan’s program.  Several of my subscribers jumped on Susan’s program earlier this week.  If you did and we haven’t talked about it, please let me know.  (Yes, I get credit for the purchase and will probably be able to take my wife out for a half a dinner at some point because of it.  )

Kenny Rushing announced a price slashing and a payment plan the other day for his Bulk REO Trader Secrets program, actually right after I sent you my last e-mail.  (Notice I didn’t send you 18 e-mails about it like some people did, informed, not overwhelmed, that’s what I’m going for here).

http://rapidreiresults.com/bulkreo

You have 30 days to check it out and if you aren’t happy, you can return it.  He also offered a 6 month, do your first deal and get double your money back offer.  That is a very cool offer and Susan does NOT have anything like that.  At less than $200 though, she is not making enough to be able to do that.

One of the big differences between what Susan is doing and what Kenny is doing has to do with their business focus.  Susan is into many different aspects of real estate.
Bulk REO is NOT her only business.  It is something she knows a great deal about though.

Kenny is 100% into buying bulk REO and part of the advantage of him doing this is he’s wanting to increase his deal flow.  If he can get 100+ people sending in Bulk packages for him to look at, naturally he is going to be able to do more business. Thus, the double your money back offer.  Pretty cool if you ask me.  You might be thinking, why don’t I just submit deals to him and not buy the program?  Great question!  His focus is to make sure you know exactly what you are doing so you aren’t wasting his time or yours chasing and submitting junk deals.  If he has say 100 deals sent to his team, he’s got to pick the best ones to work on.  This training will show you how to not only find the best deals but the best way to present them to the fund that will potentially buy them.

So, in closing, if you think it’s something you might want to get into, at least go grab Susan’s report and watch her first video to see what it’s all about by clicking here.
http://mybulkreosecrets.com

Then, go take a look at Kenny’s offer and do your own comparison, your own due diligence, and see if this is right for you.

http://rapidreiresults.com/bulkreo

I hear that he is closing it down tonight so he can get back to focusing on his main business and helping the new students out.  Teaching takes a ton of time and that is why you always see hard deadlines for these programs when they come out.  It takes a good bit of time and money to put these training programs together.  If they can more efficiently deliver it to folks at the same time rather than having 5 people start this week, 5 next week, 5 the following week, so on and so forth, then that is pretty smart I think.

You don’t want to learn this stuff from someone that is just a professional trainer.  You want to learn it from someone that is doing it every day as their main business.  Kenny’s focus has to be on buying Bulk REO, not on teaching it.  He has a fiduciary responsibility to his fund investors to keep the business moving, not get too distracted with other stuff.

I hope this has helped you be a more informed consumer, whether it is for Bulk REO or for your funding needs.

Also, if you know of a great commercial property that is for sale, let me know.  We are currently looking for strong commercial properties and performing commercial real estate notes.

To your success,

Marshall

P.S. Don’t forget to leave a comment on my blog here.

P.P.S. I will be hosting a webinar soon to show you how to use your retirement funds to invest in real estate without getting a penalty from the IRS.  Can you imagine how quick you could build your IRA if you could flip a few deals in your retirement account… especially in a Roth IRA.

Quick links update for this post.
http://GetCommercialFundingHelp.com/funding <—- How to get your funding approved.

http://rapidreiresults.com/bulkreo <—-  Link to Kenny’s program if you want to see it.

http://MyBulkReoSecrets.com <—- Link to Susan’t report that I HIGHLY Recommend.

Make it happen!!

Disclosure: This is a commercial message and you should assume that if you purchase something from one of my posts or from a link you click on from this site, that I will be compensated in some form.
I only post links for products I have check into thoroughly or am already using myself.  My posts also contain valuable info that won’t cost you a dime either though,
so stay tuned. 

You CAN Make Bulk REO Investing and Trading your business.

Technorati Tags: Bank negotiation, Bulk Real Estate, Bulk REO

Go here and check out this quick video before you even read the rest of this article.

http://rapidreiresults.com/bulkreo

I did not come up with the term “Toll Booth”.  I learned it from a marketing mentor by the name of Dan Kennedy many years ago.  I believe he learned it from someone else as well and it’s a great concept.

I have a quick question for you.

Have you ever thought about why the banks are so stupid and do not just GIVE you their properties to sell? Well, not give them, but create a significant discount right off the bat so you don’t have to go back and forth with them for several months.  You know, the type of a discount where you can make money and they can get it off their books quickly…

I mean, wouldn’t it be easier to sell something if you had multiple properties, be that residential, small apartments or commercial properties.  Well, you can with BULK REO pools and you need to be the owner of the pool to get the full benefit of this.

If you regularly pick up a package of properties, then you could march all of your buyers or potential tenants through all of the properties and surely they would find one that fits what they are looking for, especially if you target your marketing effectively.

Realtors know this, that’s why most of them strive to get as many listings as they possibly can.  Right?

It makes sense too!  If they have the most properties listed, they become the toll booth for the buyers to get through.  It doesn’t matter if the buyer is working with another Realtor either.  That’s why they have the MLS right?  It’s called broker reciprocity for a reason.  They hope to reciprocate that “Love” to another broker at some point and expect the same from another.

Now… the smart ones get as many listings as possible and get as many buyers as possible and show them their properties first.  This is especially true in the commercial market.  Many commercial properties don’t even get floated out to the public.  Why?  Because, if people get wind of a potential sale in a commercial building, tenants are more likely to move out.  Not good for the value of the building.  As Net Operating Income goes down (as tenants move out and are not replaced) the calculation of the value of the property plummets as well.

So, these commercial deals often remain hidden from most people’s view.

Another thing the really smart one’s do is they offer an added incentive to any broker that brings them a buyer.

You can do this too as an investor!!  You could offer a Realtor and added incentive to bring you a buyer.
You could also offer an added incentive to the actual buyer.
What would it really “COST” you to throw in a brand new HD Flat PANEL LCD TV?  $500-1000.  What if it kept you from holding that property for another 1-3 months?  Did it cost you anything there?

Try this on for size.  The next time you have a property to sell, put an ad out that states “Free HDTV with Purchase” and see how many more people you get to call or e-mail you.  If you were with me for the SIMS promotion several weeks ago, you know I gave you a link to watch the “Property Launch Formula”.  That is one of the key concepts discussed in there.  Adding incentives to get people to your buying event.  It’s called event based marketing… but I digress.

So, suffice it to say, becoming a “toll booth” for your specific real estate niche is a really good position to be in.
I regularly do this with lease option buyers in my area.  I have about 1500 of these that have registered on my site this year.  The only problem is, I can’t help all of them.

It takes time to talk to all of those people.  So, I have much of that part of the business automated.  They register on my website, they read my automated e-mail sequence, they look at the properties online and find out where the properties are and go look at them before they ever call me.  They can call me and some do because they would rather do that, and that is fine.  Sometimes they do that just to see if someone will actually answer the phone.  I typically make them go to voicemail at first though.  I’ve probably lost a prospect or two here and there because of this, but that’s OK.  I choose to do that rather than be on the phone with people 24/7.  That’s part of a lifestyle choice I have made.

Back to our discussion about the banks being stupid though.
I have news for you, MOST of them are not stupid!!  They are just as concerned about the real estate market as you are.  They really do NOT want to own this real estate.
BUT… they have a catch 22… and it is a BIG one!!!

If they take all of the REOs they have on their books and just shove them all on the market at the same time, the real estate market will plummet again… and it would likely happen very quickly. They are trying to help keep prices up as close to the REAL value as possible… not the INFLATED value… the real value based on the cost to build and the “Normal” amount of demand.

So, what are they supposed to do?
Well, in my search for this answer, almost 2 years ago I was introduced to a concept that I knew SHOULD exist but didn’t know how to do it or if it really did exist.

It’s known as Bulk REO trading and Bulk Note Purchasing.
It really is a cool concept and does allow you to become a toll booth.  It’s off the radar of most investors because it takes some finesse to get into it.  I bought a course from a big hedge fund that was looking for people to bring them deals.  I went through all of it and started to implement a bunch of it last year.  To my amazement, bank executives really would talk to me.  They did their due diligence on my company too.

It was a very interesting experiment.  I call it an experiment because it’s a business model that I did not pursue much but I did get a hold of several tapes to review and submitted a few to the hedge fund I was working with at the time.  Sometimes you get distracted by something and you have to refocus on your core business.  That’s what I had to do at that time so I put it on the shelf but I’m confident it works and I am still contacted occasionally by people that have tapes they are selling, all from the efforts I put forth a year ago.  In fact, the frequency of these contacts is starting to heat up and I am preparing to get back on this train because I think it will be a very lucrative route for the next few years.  It also fits in very nicely with the commercial deal funding I’m working on right now.  It’s another piece to the ever growing puzzle that is real estate investing.

If you would like to hear more about the tapes I come across or more about BULK REO investing or BULK REO Trading, join my list for this topic at the link below.

I don’t have a pool for you to look at the moment I’m writing this, but that can change and you don’t want to miss these deals.  I’m talking some properties as low as $5K – 10K.

http://rapidreiresults.com/wordpress/bulk-reo-package-available/

None of the stuff I submitted worked out for their portfolio… well, actually one did, but it worked out for someone else.  I don’t know if they ended up buying anything or not from that REO pool, I just know that another student had submitted that same tape to the hedge fund, which kind of blew for me, but I just moved on.  It was the first bank I called too!  I really couldn’t believe that I developed the relationship over the phone and through e-mail and managed to get  a crack at their BULK REO pool. It had some very good potential deals on it too. Nothing I wanted to own at the time because of location, but very good stuff.

That would have just been beginners luck right if I had gotten that first deal right there?

Of course that first Bulk REO Deal one wasn’t going to work out.
It was NOT beginners luck though.  I know the right people to contact, not the names but who to ask for, I know what the key words are that they need to hear to know what I’m talking about, and I also know how to ask the right questions in the right context.  Then I stayed in touch with this banker until the tape was ready to be released so the banker would not forget about me.

That experience inspired me to keep after it though.  Found a couple more banks with pools and started to do my own analysis of the tapes because I knew the hedge fund I was working with would not be interested, but my partner and I may have been.

Back to the topic at hand.  Can you see how getting a pool of REO properties in your inventory would make you the toll booth?  What if you grabbed a Bulk REO pool of 30-40 properties, half rented already so you know you have some revenue coming in, the rest needing some varying amounts of repairs before they could be rented, or you could wholesale them.

So, you have 15-20 properties you could dispose of via fast sale or rent and get some immediate cash and you get a nice little rental portfolio, all in the blink of an eye or build a massive wholesale buyers list because you have actual product for them to look at.  Of course, blink of an eye is a relative term.  It’s faster than buying 30-40 properties individually, but still has standard closing time frames, but then it’s all done, instant empire.  Well, not quite an empire, but you see where this is going right?

You are probably saying, yeah, but I just need the funding.
Well, stay tuned this week.  I’m going to give you some more ideas for funding.

The example above was the size of one of the pools I looked at last summer, and that was the scenario.  The one’s that needed work though needed a lot of work and we were not willing to spend that much time managing that project.  It could have been a very good deal though.

One funding option, I have the funding for you, at least a portion of it.  Now, this is not 100% financing and you do need to qualify for it, but it’s better than the alternative.  Just let me know if you are qualified and want to explore this.  YOu need to have a good exit plan though… ie. this is not for a newbie.  If you are a newbie, you better have someone on your team that is NOT a newbie and has ample experience in real estate, not necessarily BULK REO, but at least some form of purchasing distressed real estate.  As the deal size gets bigger, yes, the experience level WILL be a factor.

I also have some cool resources for you to check out starting tonight at midnight EST.  That’s the earliest I can share it with you. It will teach you more about the Bulk REO market and how you can get involved in it.

I will further share SOME of my own experiences with you even though they are limited, and give you some recommendations if you want to check this asset class out.

So, ask yourself, who has the toll booth in your market?  Is there a dominant wholesaler who always has tons of properties?  Are they buying them one by one?  Want to become like that person very quickly?  Join my BULK REO INVESTING and BULK REO Trading newsletter list below.

http://rapidreiresults.com/wordpress/bulk-reo-package-available/

Good luck in your pursuit of BULK REO investing if that is a niche you decide to go after.

Technorati Tags: Bulk REO, BULK REO Investing, BULK REO Tapes

They always happen on Friday… so expect to see a few more tomorrow.

I have been projecting out to the end of the year that we will have at least 180 failed banks for the year.

Is that a high number?

Let’s explore it.  Below is a link to the FDIC website where they list all of the failed banks for the past 10 years.  It’s a little bit top heavy don’t you think?

http://www.fdic.gov/bank/individual/failed/banklist.html

I will break it down by year because I haven’t done that for a while.

Year   – Number of failed banks

2000 – 2

2001 – 4

2002 – 11

2003 – 3

2004 – 4

2005 – 0 (Yes that’s a Zero)

2006 – 0 (Another big goose egg!!)

2007 – 3

2008 – 25  (UH OH!!)

2009 – 140 (YIKES!!!!)

By July 24th in 2009 – We had 64 banks shut down

This year, by July 23rd – We have had 103.

Maybe you think things are slowing down a little now?…  They aren’t.  You watch.

By the end of 2010, we will have at least 180 failed banks… maybe more.  Here is a little more detail about this year’s stats.  You will notice that we aren’t slowing down, staying pretty steady if you ask me.

Month – # of bank failures in 2010

Jan – 15 Failed banks
Feb – 7
March – 19
April – 23
May – 14
June – 8
July – 17 (None just prior to the July 4th Holiday and we still have one more Friday to go as I write this)

Do you think the FDIC is concerned about this… or about the perception of the public?

I’m going to tell you that they absolutely are.  Do you remember in October 2008 when the FDIC bumped up the FDIC Insured Coverage amount for deposits from $100,000 to a whopping $250,000?  That was directly related to consumer sentiment about the stability of our banking system.  It was a temporary measure to increase the coverage.  They had said at the time this would be lowered back down on Dec. 31 2010 – projecting the crisis would be over by then.

Guess what… they just made it permanent.  Well, actually it was made permanent by the “Dodd-Frank Wall Street Reform and Consumer Protection Act” signed on 7/21/2010 by the President, see the press release below.

http://www.fdic.gov/news/news/press/2010/pr10161.html

So, who are these banking institutions that are failing?  Well, they are NOT the big banks.  You know, the “Too Big To Fail” banks like Bank of America, Citi, Chase, Wells Fargo.  Nope, these banks all got their whopping tarp money and are making a TON of money off of zero or nearly zero interest loans from the FED.

The banks that are failing are YOUR neighborhood banks.  You know, the one’s with only 2 or up to maybe 10 branches.  Those are the majority of the failures.  This is all getting swept under the mat on the news.  Nobody is even covering it.  Why is that?  Do you think they are being told to “Pipe Down” about the bank failures?

This would be newsworthy in any other year.  For some reason, the news media does not care about it.

Well, I have an idea for you.  Go talk to your local bankers and let them know what you do.  See if there is a fit for you to help them or some of their clients.

If you are a Realtor, maybe you can help them with their marketing.

If you own a landscaping company, maybe you could help them clean up their REO properties to give them some curb appeal.

Are you a contractor?  See if you can do some work on the houses to make them show better on the inside or outside.

If you are out of work, there IS work to be done.  I’m totally serious!

Maybe, if the bank won’t pay you upfront, you could do a little profit sharing with them or negotiate with them to get paid when they sell the property.

Or, if you have no work right now, maybe you could use one of these properties as a showcase of your talents.  Create a history book of the property, what you did and how it turns out.

What if there was a way that you could not only help your local bank get out of trouble, but also help the local property owner get new funding?

Check this page out if  you are interested in becoming a commercial real estate hedge fund originator.  What’s that?  Go read the report on this page… You have to opt-in to get it, but it’s a great read and will explain what I’m talking about.

There is a lot of work ahead of us all to get this economy going.  Housing is a huge opportunity, but start out slow if you are just getting going.

Technorati Tags: Bank negotiation, commercial real estate, investing education, real estate investing

On Friday, July 16th, 2010, the FDIC announced 6 (SIX) more bank failures.  We are currently up to 96 failed banks for the year and we’ve barely passed the half way mark.

For the record, if you haven’t been paying attention to this trend, last year we had 140 failed banking institutions… that was for the whole year!

If we stay on the current pace, and I’ve mentioned this before, we will close out 2010 with a whopping 180 failed banking institutions!

If you don’t think the banks are motivated to deal real estate, you are completely wrong.  They just can’t let on that they are.

The bank executives and negotiators are motivated just like you are motivated when you have an investment property to sell or lease.  It’s a game of cat and mouse though.  They can’t let on how motivated they are because then the sharks start circling.  They MUST cover up the blood in the water as much as possible and paint as rosy of a picture as they can, otherwise they will be finished MUCH faster than anyone wanted and it will not do your community any good to have more failed institutions.  It puts people out of work and lowers the number of lending institutions.

To be VERY clear, I do NOT wish harm on any of these banks or bank executives.  My point is, they need to sell and if  you can present a deal that makes sense and that they can live with, they WILL do the deal.

You will NOT get anywhere if you walk in like you are all high and mighty and expecting them to bend over for you.  It’s not going to happen.  They will usher you out the door faster than you walked in and likely will NEVER do business with you.  Show your local banker some respect.

Build relationships with them and let them know what you can do to help them out.  They may just let you know about a property they are having trouble moving and then you can continue to build your business relationship from there.

If you would like to have a free report to see how you can work with some of these banks to help negotiate loans and get funding through groups that ARE lending, go check out this free report I have for you.

http://MyRealEstateFunding.com
Take a look at that report and we will have a webinar you can watch for more information.

Happy and Profitable Investing.

Technorati Tags: Bank failures, Bank negotiation, real estate investing