Appreciation

"You can have everything in life you want if you will just help enough other people get what they want!"

-Zig Ziglar

With the holiday season approaching, I made my rounds this week with the park managers/owners of my favorite parks (aka the parks I like to work in) distributing goodies and gifts.

My holiday cheer was very much welcomed and appreciated by all. It really brought a smile and put everyone in a good mood. We chatted and talked about plans for the holidays, shopping and the like. It was nice. People really appreciate when I take the time to visit and catch up with them - they feel appreciated.

And guess, what? Since I took the time to care and appreciate these very valuable people in my network, they expressed their gratitude and desire to work with me more in the future. I have been labeled as their favorite person to work with :)

The secret of my success has been directly a result of my network and the relationships I have built. So many people think in terms of money and themselves - what's in it for them? This is why the term "investor" gets a bad name. It's true - most investors are really out there for themselves, greedy and even worse - dishonest. Though, these people never last - it is short term.

Since I am here for the long haul, I make sure my relationships are built with integrity and trust. I am not in it for the overnight success like most people are. I have made a commitment to make this a long term business - I intend to keep it that way.

Speaking of commitment, I'm not going to sugarcoat it - this business takes work. Success does not happen overnight. I have had to put in the hours required to make this business work. Many people I know do not see the benefits - they think I work too hard.

I'll be honest - I've had to give up some things for this business including having a social life. It's true. Some of my friends think I need to be more social and do things normal people my age are doing such as going to events and parties. I guess it just boils down to priorities.

For me, it's not a priority to go out and meet people on a social level. I have a business to run and this takes priority over social events. I do try to make time to be social once in a while. I admit, sometimes it is difficult to interact with others who do not understand. Ah, the life of an entrepreneur!

I respect people's opinions. I think everyone has their own path in life. My path just so happens to be more different than others.

Pets!

Here's the latest deal. I had a whirlwind of drama with this one. We closed on the home but the seller needed some time after the closing to move out. So, I had to use my gut on this one - paid a portion of the funds to the seller at closing and the rest upon move out.

Here's the problem. The seller's car had some issues - it would not start. So, we had to wait a few days for the part. The part came in and the car still wouldn't start. The seller was stressed and told me he couldn't leave without his car. Told me he would have to have a mechanic take a look so it would be a few more days.

At this point, I was getting at the end of my patience. The seller had already breached the agreement - it had already been a couple days after he was supposed to vacate. So, what did I do? I told the seller the park manager was going to file for eviction soon if he did not leave. (By the way, I got the ok from the park manager to be the "bad guy" - he was cool with it).

So, the seller was in a panic. He called up one of his buddies who loaned him a truck. Then, we had one more snag - his cat. The seller was planning to go to a hotel, but asked me how about the cat? Where would his cat stay? The cat may not be allowed to stay in the hotel. None of his family or friends would allow the cat to stay with them. He told me he couldn't leave without his cat not having a place to stay.

Ok, I was at my wits end with this deal - I knew I needed to have the seller vacate asap. I looked into a few "pet resorts," they call them here where you can leave pets overnight. They were booked up. Called a few animal hospitals - they only accommodated existing clients.

I dialed and dialed and dialed. Finally, I found a veterinary clinic. Talked to them - they told me usually they only accept existing clients for boarding overnight. I used my last breath of energy on them, "Well, I could be a potential client." They accepted and I made a reservation for the seller's cat for overnight lodging. Cost the seller $9 per night, but that was good enough. Both the seller and the cat now had a place to stay - they vacated that day. Problem solved, case closed.

Stolen!

Today, I went to meet the electrician at one of the trailers to check out the wiring. To my surprise, all of the window units were gone! In addition, the outside a/c unit was also gone. I knew who it was, I just couldn't prove it. You see, the owner of the trailer who sold the house to the seller (who in turn sold to me) told me the owner gave her all those a/c units. And, before we closed she told me he would also take out the outside a/c unit since it was no longer working. So, it's a surprise that the outside a/c unit and all the window units are gone? Problem is, I can't prove it was him. I tried calling him but to my surprise - he can't receive incoming phone calls! He has a few trailers in the same park as well and it's just a coincidence that one of his he's working on now just so happens to have a new window unit sitting outside. Ugh!

So, I called the park manager and told him I was really mad. The park manager apologized and told me he will look into it and let the maintenance man know to keep an eye out. He suggested I could file a police report but I'm not sure what good that will do since they are already gone.

At this point, I learned a valuable lesson. Secure the house and all it's belongings at all costs. Though there are also window units in this park, anyone at any time can come around and pull it out of the window - that's what happened in this case. This is a lesson learned - a lesson I won't forget.

Bug Alert!

Sometimes this business requires you to get down and dirty - literally. Recently, I had a trailer cleaned out. While the cleaning crew was there, I noticed there were a lot of flys hovering over the carpet. I mean a lot of flys, like 30 of them - seriously. So, I ask my cleaning crew about the flys. They told me they weren't sure why they were there - maybe there was some food in the carpet. I planned to have the carpet cleaned professionally after the trailer clean out.

I decided to seek some professional counsel - aka another park manager. The park manager told me it has to be food or something in the carpet. She advised me to fumigate the entire house with "fogger" (see the pic below) before the carpet cleaners came to clean the carpet so the bugs would be dead on arrival.



So, I took the park manager's advice - fumigated the entire house with "fogger." Basically, "fogger" comes in a spray can and you set it down in each room in the middle and it begins spraying the stuff that kills the bugs dead. I was kind of freaked out about it as I thought it was like bombing the house and wasn't sure how much time I'd have to get out. But, it was no big deal. Once you start it, it sprays slowly and you've got some time to get out of the house. I did this for each room in the home.

In any case, I came back after a couple days so that I could meet the carpet cleaners. Guess what I found? Check this out:



It was crazy! It wasn't just one, but a bunch of these things dead all over the house! Yuck! Guess they were hiding. And, yes those flys died instantly too.

In any case, the carpet cleaners came and cleaned the carpet. I've found it better to clean carpets rather than replace them using an awesome carpet cleaning company referred to me by a park manager - they do wonders with carpets. Even if the carpet is really dirty, they take it out using a special machine to steam clean the carpet.


So, lesson learned. Guess I always learn something new with this business. It's all worth it, even if I have to get down and dirty from time to time!

Here we go again!

Here's another deal. This home was an eviction - very different from what I'm used to. Most of the deals I've made have been straight from long time homeowners. The situation was pretty complicated. I won't go into too much detail - let's just say there was a lot of drama with the seller's personal situation. Enough said.

In any case, the seller had the physical title from the owner on record. This meant that ownership needed to change from the owner on record to the seller, and then to the seller to me. I did not know if this was possible to do on short notice - the park manager literally was going to evict the seller in 2 days! Eeeek!

So, I get on the phone with the housing office and they tell me it can be done but needs to be done all in one transaction. Otherwise, we will have a waiting period if done separately. Ok, good. Now, all I needed to do was talk to the park manager to stop the eviction.

I get on the phone with the park manager - he agrees to work with me but not with the seller. So, the eviction was stopped. We went down to the housing office, did the title work and now the seller is packing and getting ready for the big move.

The seller is having a garage sale this weekend to raise more money for the move. We agreed that no funds will be paid until the seller is completely out of the home as well as all of the contents in the home. I am not going to be stuck with someone else's stuff. Agreed.

Wow, what a roller coaster ride this has been ! The park manager now tells me there's another one in the park he wants me to look at - same situation - he is getting ready to do another eviction. Guess this is how you learn, just going through the motions!

INS Raid

This home was the subject of a major INS raid - 26 illegal immigrants and their families living here held hostage as wage workers. The owner who was collecting rent from these people was sent to jail and the FBI was involved. Pretty crazy stuff!

Window Units and Space Heaters

Interesting pic, eh? Yes, this window unit is being held up with a stick - it is too heavy for the window.

Checked out a home with 3 window units in the living room/dining room and 2 space heaters used in the bedrooms, no central heat and air. This is my first encounter looking at a home without central heat and air. The space heaters could be a potential liability - I hear there are some that have automatic shut off. If I end up pursuing this one, I may look into getting more window units for the bedrooms.

Interesting Article - "10 (More) Reasons You're Not Rich"

Read this article. Pretty interesting stuff. Truth is, most people who are rich really do not look rich. For the most part, it is the people who look rich who are not really rich.

Latest "Lonnie" Deal

Well folks, here's my latest "Lonnie" deal. I had no idea this thing would go through. Actually, I was on my way to see a home out on a piece of land before going out to see this one. Turned out, the home on land didn't work out - the lady told me someone else came before me and put a deposit. Told her I know she has a deadline to get the home off her land - if it doesen't work out to contact me but please give me advance notice. Ah yes, many a times I've been called in desperation with someone having a home they need moved that day or the next day! Seriously, this business can be very demanding at times...

Getting back, I went out to this home. It's quite an interesting story. It was owned by a husband and wife couple - they had other properties they owned and managed. The husband wanted to sell but the wife did not - they were currently renting out the unit. After talking with them for awhile, I got on their good side and they both decided it was a good idea to sell. The crazy thing is that out of all their properties this was the one that was cash flowing for them. Why on earth would someone want to sell this?

Well, they didn't really see any value in the home. They told me "....it's a depreciating asset," and plus they told me they weren't the type to shop at Wal-Mart, if you know what I mean. Yes, many a times I get laughed at for doing this business, I think the word "ghetto" is what most people (including some of my friends) have referred to it - guess it just ain't so glamorous, eh?

In any case, I checked out the home. Everything was in pretty good condition and they even threw in a washer and dryer! Guess they really did want to sell the home.

So, we closed on it. Of course, it took the whole day to do the walkthrough inspection and the paperwork with the housing office. But, it was well worth it. Plus, I learned a few things from the sellers about taking care of animals - they used to have goats on a farm. Gotta love this business!

Now, it's in the process of getting cleaned up. Once it's cleaned up, I may have the living room and kitchen painted as the paint is coming off and the carpet shampooed. Then, it will be ready. There are already some people in the park interested - they approached the sellers and asked them if they can buy it. But, the sellers told them they are working with me. Guess they didn't want to be bothered with so many people.

It was a win/win situation for all. The sellers are now happy they don't have to deal with this home anymore. I got a deal. Win/win for everyone.

I'm working on a couple more things. Have more opportunities now with some parks to fill lots - now they are paying me to move homes in ;) Pretty cool....Gotta love this business!

Bank REOs

With the end of the year approaching, my new angle is to work the bank REOs in addition to working with individual sellers. Surprisingly, the banks have been more than helpful. Personally, I was a little apprehensive working with the banks as I've heard they are hard to deal with and have been unresponsive to most people. I don't know if it's just me and my personality, but the banks have been pretty cool to deal with. Maybe my studies with Gitomer had something to do with it. Go figure!

So, today I checked out another bank REO located in one of the parks I work with. Guess what? As soon as I drove up to the house, I could tell the home had some issues. I didn't even have to set foot in the house. What tipped me off? Check this out:



Hmmmm....What's wrong with this picture? Can somebody say roof damage? And, let's not forget about those lovely wood panels with the moisture issues. Can you see the wood breaking up? Here's a closer look:





Ok, so is it just the outside with issues? Here's what I found when I went inside:

Water damaged wall



Mold



Water damage ceiling



Door entryway water damage



Clearly, the house had some issues. As soon as I walked into the house, I could smell the mold. Surprisingly, the park manager didn't think it was that bad...until I came and pointed out these issues. But, what really confirmed my feeling about the house was not the house itself but the neighbor who lived next door.

The neighbor was a friend of the prior owners. Let's just say people talk...And, they talk a lot. Most people want to talk, talk, talk. But, I've found out that if you listen to what people say, you'll learn a heck of a lot especially in this business.

I start talking to the neighbor and asked her a couple of questions about the house. The park manager was with me and really didn't think the neighbor really had that much insight into the situation. Little did she know what the neighbor knew. The neighbor told me about all the water and moisture issues with the house. How did she know? Well, she was the prior owner's neighbor and friend, and regularly came to the house to visit. Whenever people have problems, they talk about them to their friends and people they know. Pretty logical stuff.

So, the neighbor goes on about the house and tells me how the house was always leaking, moisture was getting into the walls, how one of the water pipes burst, how the prior owners would complain water kept getting into the house, etc, etc. Wow, the list goes on and on! Then she goes on to tell me the a/c unit outside is gone - someone stole it. And, there's always been a major leak in the bathroom. Plus, the commode in one of the bathrooms doesen't work anymore. Honestly, this is very important information to know.

What I deduced from the situation was that the roof probably has not been sealed for quite some time. Somehow moisture has made its way into the house and will continue until the problem has been found. However, it's already been to the point where mold is growing and moisture has seeped into the walls. The insulation is going to need to be torn out and replaced with new insulation. Probably the roof will need to be sealed again. All of the walls with the moisture will need to be replaced. Plus, the wood paneling outside will also need to be replaced. Clearly, this house is a much bigger project than what I'm looking for. It will take more time and work to get the home ready and safely habitable. So, I decided to pass.

Lesson learned. I have learned to be humble and listen more to people when it comes to this business. Most people want to talk and think they know what they are doing even though they don't - a big mistake. I learned the hard way. Let's just say my mistakes in the past have cost me a lot of time and lot of money. Now, I have learned to listen when it comes to matters of the unknown.

3 Plans

I've been re-reading pretty much all of Kiyosaki's books lately. I just finished "Cash Flow Quadrant" and now I'm on to "Guide to Investing."

It's made me re-think the 3 plans for financial core value choices rich dad and Kiyosaki mention. The plans are:

1. To be secure.
2. To be comfortable.
3. To be rich.

Every person has their own definition of what it means to be #1, #2, and #3. This is very important because it examines your financial core values and just what kind of life you want to live.

I thought it was interesting that rich dad advised Kiyosaki that all 3 plans are important, and you first have to accomplish #1 and #2 before #3. Each one relies on the prior. If you want to have a life of the rich (#3), you have to have a plan for security (#1), comfort (#2) and being rich (#3). And, if you want to have a life of comfort (#2) you have to have a plan for security (#1)and comfort (#2). If you just want a life of security (#1), then you just have to have a plan for security (#1).

Kiyosaki's initial goal was #3. But, when he got to #3 and became a millionaire he lost it all. He then goes on to state that after this experience he revised his plan to include being rich and also being financial free, thus #1 and #2.

So, I've been thinking about my 3 plans and what they mean to me. Here's what I came up with:

1. To be secure.

For me being secure means having enough passive income to cover my expenses. This is my first goal. I am almost halfway there and should be half through with this goal by the end of the year. By the middle of next year, I will have completed this goal.

2. To be comfortable.

For me being comfortable means doubling the passive income coming in from #1. Being comfortable means being able to live a nice life with nice things. This is what most people strive for.

3. To be rich.

Being rich to me is having unlimited passive income coming in and having freedom to do anything I want at any time. Of course, within legal means ;) I don't really want to put a # or price tag on being rich because that is limiting to me.

Being financially free is not just about money to me. It's about having the freedom and the time to do other things I want in life besides just working for someone else. It's sad that we work 80% of our lives and only enjoy 20%. (aka Pareto's 80/20 principle).

Working for someone else is making someone else rich. People think what I'm doing is too hard. Just like Kiyosaki, I've gotten the "...why don't you just get a high paying job OR go get your MBA? Or, "...your making life so hard on yourself, it'll be easier to just go get a job."

Yes, the above statements is what everyone else does and considered the easier road to take. But, I believe everyone has their own path in life. Just because everyone else is taking the same path does not mean I have to. Mine just happens to be different.

Though it's been a lot of hard work and taken up a lot of my time, I know what I am working for will pay off in the end.I always come back to the statement,

"Success is a journey, not a destination."

It is the journey and the experiences and lessons I learn along the way that are invaluable. And, that is priceless.

Pacific Heights

I saw the movie, "Pacific Heights," again. This is known as the movie to watch if you ever decide to be a landlord. Basically, it's a landlord's worst nightmare - having the worst possible tenant. Landlord beware. It's funny b/c some people think the things that happen in the movie are ridiculous but being in the business some of this stuff has happened in real life. Seriously. I've heard the craziest horror stories from people who've had tenants from hell. The hardest part is getting them out. Once they're out, the worst is over. But, most people don't know how to get them out - that's the trick to it ;) (In all honesty, the secret is screening and knowing the laws and your rights).

This is a must watch movie for anyone wanting to get into landlording. Probably what this film has taught me is:

1. Don't overleverage yourself. You must be cashflowing from the start. (These people were negative cash flow from the beginning. Thus, the desperation in having to find tenants to make the mortgage).

2. Always know the laws and your rights.

3. Screen, screen, screen because "...a vacant house is better than having a problem tenant."

Rich Dad, Poor Dad

After years of investing, I decided to read "Rich Dad, Poor Dad" once again. It's always interesting reading something again. This time around, a lot of what was said made more sense to me than the first time around. Here are a few things that stuck out:

"The rich buy assets. The poor only have expenses. The middle class buys liabilities they think are assets."

So, in order to be rich, then all we need to do is buy assets? Wow! It sounds so easy. If it's so easy, why aren't we doing it?

It stems from the fact that people lack financial education. People do not know the difference between an asset and a liability. Most people think assets are "things" that have value. If we learn to see an asset as something that puts $ in our pocket and a liability as something that takes $ out of our pocket (as the book says), it would make things so much easier.

But, it's hard to change people. The most important thing people can do to change their situation is to put time to improve their financial education. Most people do not. Knowledge is power.

That is why I am dedicating my time into my financial education and building up my asset column. Over time, I know it will pay off. Most people my age think that I am working too hard and that I should enjoy my youth. I keep hearing the phrase, "You might die tomorrow!"

Many people do not see the problem we are facing - our financial futures are in danger. Why? We live in a society that expects too much from others and when our expectations are not met, we find someone to blame. So, what happens when someone is laid off from a company after almost 20 years of service? That person gets angry and is left with no income coming in. They either have to find another job or live with what they have saved up in the bank. And most cases, people do not have much saved.

The reality is that we are poorly educated financially because of the archaic school system. The adage of "go to school, get good grades and get a good job with a good pension are long gone". It's not going to happen anymore - people are living longer, costs are rising and companies can no longer afford to pay people who are no longer working for them. The numbers simply do not work.

Most people I talk with will give me every excuse in the book not to invest. Most will say they do not know where to start, they do not have $ to invest, their too young, or they plan to work.

Usually, I tell them the best thing they can do is to start putting in the time into their financial education and start reading books and/or attending seminars. Most times nothing happens. Why? Fear and greed. The problem is everyone wants to make $ and they want to make $ fast but they are afraid to make mistakes. If people cannot make $ fast and not make any mistakes, then they shut themselves off. Honestly, I've never met anyone successful who has never made a mistake. I've made plenty. We all learn from our mistakes.

As it says in the book, this is the problem we have and it plays on the two emotions of fear and greed. People are so fearful of losing $ investing or not having a secure job. So, they end up working and in working the greed sets in. People buy things on credit they cannot afford. In order to pay for these things, they have to work. Thus, the cycle begins.

After reading the book again, it's amazing to see how fear and greed take over people's lives. Sometimes it irks me when people ask me how they can be rich fast. I tell them there is no "get rich quick" way to make $. Everything takes time and work. But, over time the work will pay off. Usually, I get blank stares. And, most people go back to their usual life and end up in the "rat race" for the rest of their lives.

Estates & Foreclosures

Just recently, I was very close to buying a mobile home in an estate. So, what was the problem? Too many people involved. I remember an old saying, "The more people involved in a transaction, the longer it takes." This phrase rings so true.

In this situation, there were 3 sisters involved each of them living in a different state. The sister I was dealing with in my area had showed me the home. We walked through it together. It had been vacant. But, I noticed she was more concerned about telling me about her personal life - her divorce, financial situation, etc. This raised a red flag and reminded me of people that I've worked with who have financial problems and most likely are in foreclosure.

Personally, I have not had much success working with people who are in foreclosure. It's very difficult to work with people who are so emotional and most times can be financially irresponsible. It has never worked out for me.

So, I had to negotiate a deal with all 3 sisters for the home. Mainly, I was talking to the sister in my area and another sister in another state. Turns out, the sister in the other state was very financially responsible since she was covering the majority of the costs for the home. Let's not forget - a vacant home is a problem home.

In any case, I was about to buy the home and get the deal closed. The sister in the other state was ready to get this done since she had put so much money into it. Low and behold, the sister in my area calls me up and tells me she has just moved into the home because she had been asked to leave her current rental place. She tells me she's going through some hard times and this will be easier for her financially.

Most times, the only reason someone is asked to leave where they are currently renting is because they cannot pay the rent. This could be the case in this situation. So, I call the sister in the other state and leave her a message regarding the change in the situation. (I did not think the sister out of state was aware). Then, I call the park manager of the park to let her know of the sister who had already moved into the park. She will need to go through an application approval process just like everyone else in the park. It will be up to management whether or not to approve the application. If the application is not approved, she cannot live in the park.

What is the outcome of the situation? Only time will tell. I suspect this may land back onto my plate in a couple months. With lot rent, taxes, insurance, energy and other costs associated with the home, this may be more than what the sister in the area can handle with her current financial situation.

It's turned out to be quite a messy situation. It may get even worse. This may be a good thing in disguise.

Just Do It

"Just do it."

Ever heard this slogan made famous by Nike? It rings so true.

When it comes down to it, what differentiates successful people from everyone else is taking action. Yes, mistakes will be made. But, we should not be so afraid to make mistakes that it will stop us. Taking action and doing something is better than doing nothing at all.

One of my fellow investors always brings this question to people who are thinking about getting into investing,

"If you continued to do the same thing you did this year, where would you be next year? Would you be where you want to be?"

If you continue to do nothing, you can never change your situation. If you want to change your situation, you must take action. Now, I'm not advocating going full force into investing and quitting your job. Quite honestly, that is not the best thing to do.

Get educated first. Figure out where you want to be financially and how you will get there. This will depend on your experience level and financial situation. Do you need to build up some cash first? Or, are you ready to invest into income producing assets and have the necessary cash reserves?

If you are just starting out, the best and safest way to go is to find a local investor in your area who is doing what you want to do. You may have to go through a few people to find the "right fit." What you want to do is find someone you can learn from locally who also wants you to grow as a person. It needs to be a mutually beneficial relationship for both of you. Remember, nothing is free and it is ALWAYS a two way street.

Take a couple people out to lunch and find one person you can connect with and feel you can learn from. So, what does the other person get in return? Well, I would say that you would need to figure out a way so that both parties can help each other. I highly recommend finding deals for other investors to start out. You can highly leverage yourself learning from a local investor who can also tell you what to look for and their investment criteria.

Most times investors are open to this and will gladly pay a finders fee to you if a deal is done as a result of your work. Be sure to check the local laws of your state to see how this can be done legally. Some investors decide to contract this work out as independent contractors, or some even may offer to put you on payroll. It all depends on who you are working with.

When you're first starting out, always remember the goal is to learn. Do not, I repeat, do not get greedy and think you know everything. No one knows everything. Most times, you learn on the job - learn by doing. Yes, you can read about the experiences of others. But, you will learn through your own experience. Personally, I didn't understand this concept when I first started out. Now, I do.

All in all, have fun with it. If you can take action by at least finding deals either for someone else or for yourself, the battle is halfway done. Once you get good at finding deals and putting deals together, then you are well on your way.

Sea Container Homes!

Wow, check this video out - it's crazy. They are making homes and buildings out of the sea containers that are used for storage when shipping things. Pretty fancy stuff!

Baby Steps

I've been asked the question about "how to get started" time and time again by many people wanting to get into investing. In all honesty, what separates the people who are successful from the rest is taking action. Yes, education is important. But, you can only learn so much. Most of the stuff I have learned through experience - out in the field.

I guess what I've learned the most is the small successes are the most important - aka getting over your first deal or making your first offer. Through small successes, you build confidence and get the experience for larger successes.

I still remember my first deal in this business - I was terrified that my offer would not be accepted and the park manager would not allow me to work in the park. I had to coach myself beforehand (aka positive reinforecement).

But, you know what? I got over it.

I learned the most important skill I could have in this business is not how much experience I have or how many deals I've done. The most important skill for me is my ability to connect with people - get them to like me, establish trust, and master the power of influence at the same time making a win/win situation for everyone.

Now, that I think about it - it's really about having people skills. Business is about people. No matter how much technology we have in the future - it all comes down to people. And people like doing business with people they like and trust.

I continue to improve my people skills and read up on sales and marketing skills in order to improve myself. Robert Kiyosaki, author of "Rich Dad, Poor Dad," mentioned if you're planning to run a business you need to know how to sell. It is so true.

So, no this stuff does not happen overnight. The people who want to get rich quick really never last in this business. It requires commitment for the long haul because after all nothing happens overnight. Success comes to those who work at it and continue despite the obstacles.

Knowledge is Power

"Knowledge is power."

This phrase rings so true. I feel the need to comment on it because I had a situation with a prospective buyer where I had to use my knowledge to help them make an informed decision. Basically, this buyer really liked the home but was a bit concerned about the structure of mobile homes with regards to rain and moisture.

So, I educated the buyer on what I knew about mobile homes - how you need to make sure the gutters around the home near the roof are working properly and re-routing the water away from the home and not damaging the side of the home. I pointed out the gutters on the home to the buyer and then pointed across the street to another home that did not have any gutters around the side of the home. Clearly, the water on that home is not being re-routed and could be a problem in the future.

Additionally, the buyer asked about siding and the possibility of water and moisture seaping in. I informed the buyer based on what I knew that usually happens with hardiplank (wood) siding if the gutters are not working properly, or even worse - no gutters at all. If water runs off the side of the home onto the hardiplank board, then yes - it will cause moisture on the boards and possibly even into the home. If this happens, I informed the buyer it's just a matter of replacing the boards with moisture and making sure the gutters are working properly to re-route any rain or water.

Then, I took it a step further to educate them about aluminum siding and it not having this issue as water just runs off the side since it is made out of aluminum. Though, it is always a good idea to make sure the gutters are in place, working properly, and water is being re-routed away from the home.

After educating the buyer and being there to answer any questions and concerns, the buyer appreciated me taking the time to inform, educate and share my knowledge.

So, what happened? The buyer felt comfortable with the home and decided to proceed with the application process.

Education is so important. I make it a point to continually educate myself and be a lifelong student. If I do not know the answer to a question or unfamiliar with a particular area of expertise, then I go out and find someone who does. I am always learning from the experiences of others as well as my own experiences.

Knowledge is power and that power is leverage. Leverage allows you to accelerate and move ahead faster than people who do not have the knowledge.

Mobile Home Conference

I recently attended my 2nd mobile home conference. It was pretty neat to see some familiar faces and meet some new people in the business. I did learn a few things the second time around.

Looking back a year ago when I attended my first conference, it was very overwhelming and exciting with the amount of information I had learned. This year, I felt more relaxed and found it easier to understand concepts that were above my head the first time around.

What I've learned after talking to people who are actively investing and learning various investing avenues, is to keep the big picture in mind. In reality, the whole point of investing and creating a passive income for me is to free up my time to be able to do other things. I definitely do not want another J.O.B.

So, in talking with a couple fellow investors I have come to find an investment vehicle that will allow me to have a life without much involvement from my end - mobile homes. When I first started investing in real estate, I think my goals were so big that it was so hard to attain and keep my involvement at at minimum.

Honestly, I like keeping my operation small. It gives me complete control. I know a fellow investor who runs a pretty big operation with a portfolio of a couple 100 unit apt buildings, mobile home and RV parks. Every time I see this investor, he's always so stressed out and seems to never have time to do anything except work. Managing larger portfolios involves managing more units and more people. I really do not want to have that kind of life where I am working all the time and have no time to do other things. Its just not for me.

At the conference, I saw another fellow investor who started out doing these small mobile home deals. He did 45 of them until he finally quit his job. Recently, he just finished a turn around mobile home park project - 185 spaces. He had to move his family out of state, live near the park, and it took 3 years of his life. After talking with him again this year, he told me what he missed about doing the small mobile home deals was the time he had once after he put the deal together. He could move on to the next deal and the passive income came in without him being there.

He gave me some good advice and told me if I'm happy doing the small mobile home deals and they are allowing me to free up my time to do other things, just to continue with that and build up passive income with each deal.

Another one of my fellow investors told me that he went back to investing in single family homes in nice areas because he just did not enjoy managing apt units. He told me the biggest issue for him when he owned his apt building was not having the time to do other things. He was constantly receiving calls about the units needing this and that - it was a headache.

All in all, I've decided to continue investing in mobile homes and just building up passive income. Maybe someday I will look into other investment vehicles. Or, maybe I will just sit back, relax, and enjoy the time I have created by investing in mobile homes.

Finding Buyers

When it comes to finding buyers, its more of an art than a science - aka "trial and error."

There are 2 types of buyers out there - the serious ones and the not so serious ones.

Serious buyers are more concerned with the area they are looking in than the price of the home. Location, location, location. Sure, they do want a home that is affordable - that is your job to provide affordable financing. Though, the emphasis when they speak is on the location and not the price of the home.

Not so serious buyers will just ask about the price of the home without any or minor mention about the area. With the not so serious buyers, my recommendation is just to answer their questions and try to move on to the next call asap. Don't waste too much time on these people. These buyers are more interested in price and are looking for a good deal. If you spend time with them, they will try to get as much as they can out of the deal and you will feel exhausted. Even worse, you may end up with a buyer who wlll default.

It is a waste of time to spend all your time and energy on one buyer. When people call, you'll get a feel for the right type of buyer by listening to their words and the types of questions they ask.

But, talking on the phone is merely the first step. DO NOT, I repeat DO NOT meet with anyone who has not first driven by the home. Instruct everyone that you speak to drive by the home first before you set up an appointment to see the inside. Why?

Remember, actions speak louder than words. Serious buyers will drive to the home and check out the area. Matter of fact, most serious buyers who call have found you through the sign in the yard - not your marketing elsewhere. Serious buyers are already scouting the areas they are interested in. Not so serious buyers do not.

So, how do you figure out who the serious buyers are and the not so serious? Experience.

As in business, there's a difference between theory and what really works in the real world. To really learn, you must learn by doing. So, what does this mean? It means taking calls personally even though your phone is ringing every 5 seconds. Yes, this will happen. Be prepared. It means driving to the home to show it to the people who sound serious on the phone and have taken the extra step of driving by the home. Even if this means doing this repeatedly until the home is sold.

Once you have showed the home, instruct the buyers who seem serious the next step - filling out the application. Now, this is where you can weed out the real serious buyers from the not so serious ones. How? The really serious buyers will take the time to fill out the application and PAY the application fee ASAP. I give them two applications - one for the park and one for me. They have to pay the park's application fee but not mine. If they fill out both applications ASAP and pay the park's application fee, then I know I have a serious buyer. I tell everyone who fills out the application that they have to go through the application process. Based on the applications received, I pick the one I feel most qualified and most comfortable working with.

Believe me, it takes time to learn how to read people - it's a skill in itself. I've been through it both on the buying and selling end. Every deal will involve the same steps but I learn something new every time. This business works but with all things you gotta do the work to get where you want to be.

Taking Action

"If you want to get things done, sometimes you've got to do it yourself."

This rings so true in running a business. Either you do it yourself or you get someone else to do it for you. But, what happens when over and over and over again, things do not get done by the very people who you count on to get things done? Well, then you either do it yourself or get someone else to do it.

What really gets to me is when people say they are going to do something but never end up doing it. Now, I can go on and on and lay blame on people. But, in the end it's not going to help achieve the end result - getting the task at hand done.

I'm going through this right now with a minor rehab. It's a case where the park manager has offered to help with many aspects of the rehab. Problem is promises get made and things do not get done. I think the park manager has good intentions of helping but at the same time - time is money. And, I've got a lot of money riding on this project.

Instead of laying blame I had to go out and take action. One of the things that needed to get done was replacing the flooring in the master bathroom around the toilet. The flooring was old and very unstable, not safe to use.

So, I called my handyman and he said he'd be able to replace the floor but could not take out the toilet as that is a job that requires more skill for someone such as a plumber. The great thing about my handyman is that he knows what he can do and knows what he cannot. That is one thing that I've learned about hiring people - the good ones know their capabilities and stay away from things that are foreign to them.

In turn, I called my plumber and he agreed to remove the toilet so that my handyman could start work on replacing the floor. After my handyman finished the job, my plumber said he'd be able to put the toilet back.

Well, my handyman finished the job as scheduled. So, I called my plumber but he was well on his way to Mexico to go out of town. I had no way of reaching him as his cell phone coverage did not pick up.

What to do? I was stuck with a new floor in the bathroom and a toilet needing to be put back in its place. Well, I had to do something as people were anxious to see the house and I had not made it available to show due to the rehab work.

So, I bring this issue up with the park manager. She offers to call her plumber and tells me if he can't do it, then her husband who does fix-up work can. Well, to make a long story short the plumber never gets back to her and her husband got sick. This dragged on for a week.

So, I had to make a decision and I had to act fast. With one last attempt, I called my plumber and guess what? He just got back. I told him the problem - he apologized. And, now he is going to put back the toilet where it belongs.

What is the moral of this story?

I guess what I'm trying to say is not to depend too much on one person for all your contacts. I've tended to do that especially with the park managers. I think they have all the right contacts because they deal with fix up work and issues in the park all the time. Yes, that's good. But, I also have to have my own team and be able to make decisions when the issue arises.

So, I've began to make contractor contacts by residents of the parks in addition to park managers. And, a lot of times the residents of the park do contract work for a living - go figure! So, I've made it a habit to talk to the residents in the parks I work with and ask them who they've used for contract work on their own houses. Also, I scout the bulletin boards at the parks I work with for contractor cards. I spend time calling these contacts. I get a feel for what they do and their experience because I never know when I may need someone quick when one of my other contacts cannot perform work I need to get done. I've learned it's always good to have backup people lined up just in case so you don't rely on one person to provide you with all the contacts as I have with the park managers.

By taking action, I have avoided inaction. It is better to take action than not to act at all.

Inspecting a Mobile Home Part II

After you've inspected the inside, you're ready to inspect the outside. When inspecting the outside of a mobile home, make sure you inspect the entire home all the way around.

The first thing you'll want to check is the structure of the home. Usually, homes have two kinds of siding depending on the age of the home. They are:

1. Wood
2. Aluminum

If you are inspecting a home with wood siding, feel the wood and make sure there are no soft spots. If there are soft spots, determine how the problem occurred. How is moisture getting to the wood? Do the gutters (up above) need to be replaced?

On my first deal, I looked at a home with wood siding. It had soft spots on parts of the wood siding, it looked like a few boards needed to be replaced. I brought in 5 contractors to look at it to determine the problem. I found out the gutters (up above) needed to be replaced. The gutters had holes in them (yes, the home was over 10 years old) and when it rained the water would just go through the holes in the gutters running the side of the home. Over time, the water seeped into parts of the wood siding thus creating the soft spots I found in the wood.

If you find some soft spots when inspecting a mobile home with wood siding, determine how many boards need to be replaced and the labor it would cost to fix it. Regarding working with contractors, you can work with them either by having them provide the materials and do the work, or you provide the materials and you just hire out the labor. I will have an article about working with contractors here down the road.

The other type of siding mobile homes tend to have is aluminum siding. Usually, aluminum siding requires less maintenance and attention than wood siding homes. Make sure there are no rusty spots and all the siding is in place. Be sure to watch out for gaps in the siding which may allow weather elements such as water, sleet, snow, etc, into the home.

After you determine the condition of the siding, next thing you'll want to check out is the roof. Ask the seller when the last time the roof was replaced and/or re-sealed. Usually, if they are re-sealing the roof it's best to do it every 2-3 years. Ask the seller if they have had any leaks and/or other problems with the roof and be sure to write things down.

When inspecting the roof, I like to take a step back to see the top of the roof. Make sure things look in tact and in order. Watch out for any gaps or anything that may look like they have patched things up. If you see anything that stands out, point it out to the seller and ask them to explain what you are noticing.

Check out the gutters (up above). The gutters need to go all the way around the house. Again, ask the seller when the last time the gutters have been replaced and if they have had any problems with them. It's very important to make sure the gutters are working properly so the water is being routed properly when it rains.

Next, you'll want to check out the a/c unit. Have the seller turn it on (from the inside). Make sure it is working properly. Again, ask the seller when the last time they changed it and if they have had any problems with the unit. (You'll notice you'll be asking these same questions over and over again as you inspect each part of the home).

Look at the windows. Make sure there are no broken windows and they keep away the outside elements. You'll also want to check out the skirting - make sure it's in tact. If there is no skirting, ask the seller why and how long it has been unskirted. (If you are inspecting a home in a mobile home park, usually it will be skirted per the rules of the park but not all the time).

Go all the way around the home inspecting all the things up above. Jot down anything you notice that may need some work. Point these items to the seller and ask them if they are going to do anything to fix it up.

Lastly, be sure to obtain the serial number of the home. This is important so you can check to see if there are any liens and the seller is the owner of the home. You'll have to check with your state to determine which agency regulates Manufactured Homes. Usually, the serial number is on the back of the home. If you do not see a serial number, ask the seller. With very old homes, usually the serial number would be on the title.

Once you've completed your inspection and jotted down all your notes, ask the seller how much they think each item would cost for the things that need fix up work. If they do not know, just ask for an estimate of what they think. Then, ask the seller if they would be willing to fix it up themselves or give you a discount for selling "as-is." This will come in handy when it comes time for negotiation.

Depending on how comfortable you feel, you may want to bring in some contractors to give you estimates on the fix up work. After looking at several homes, you'll start to feel more comfortable with estimating the fix up work involved.

Inspecting a Mobile Home Part I

Before you decide to buy a mobile home, you will need to make sure you have taken the necessary steps to inspect it throughly - inside and out. Know what you're buying before you make the purchase.

Most of the information about the home can be obtained before you even leave your doorstep. When talking to the seller on the phone, here are a few questions to ask that will help you decide whether or not you want to take the trip out there to inspect the home:

1. How old is the home?
2. What is the size of the home?
3. How long have you lived there? (If they have lived there less than 3 years, usually I find the home to be in poor condition)
4. Tell me about the inside of the home. Is there any fix up work involved? How is the plumbing, electrical, a/c, etc?
5. Do they have pets? What kind of pets?
5. What known issues have you had? Have you done any repairs lately?
6. Tell me about the outside. How's the roof? Have you had any leaks? When was the last time you replaced the roof?

Ask as many questions as you can beforehand. Depending on how much fix-up work you want to do, decide whether or not you want to proceed. (If you are new to the mobile home business, I highly recommend going out and inspecting as many homes as you can just for the experience).

Before going out to the home, be sure to wear comfortable clothes and the appropriate footwear. (No open toed shoes here!) If the home is located out in the country, sturdy shoes or work boots work well as there may be mud and/or dirt terrain. Also, I've had to spray on a coat of insect repellant when going out to the country. One last thing, be sure to bring a flashlight just in case there are some hard to see places. Last of all, you want to bring a notebook and pen. Be sure to jot down all your notes during the inspection!

When you get to the home, greet the seller and pay attention to everything. Let the seller do most of the talking - you'll be surprised how much you'll find out about the home by just listening and observing.

Personally, I like to start on the inside of the home. Let the seller walk you through. Again, let them talk. The seller will probably have some stories to share with you about the different areas of the home. Be sure to ask a lot of questions. Remember, you are the one with the most interest as you are the one buying. Act as if you were going to live in the home yourself. (If you are going to live in the home, the more you need to be diligent with your inspection).

Usually, the seller starts in the living room area since it's closest to the entrance to the home. Pay close attention to the ceiling - are there any water spots? Ask if there have ever been any leaks. Also, look at the carpet. What is the condition of the carpet? Any water damage? If so, ask what the seller plans to do to fix it? Look at the walls. Are there any holes or patches? Point out anything to the seller that may look like it needs fix-up work. Ask the seller what they plan to do. Will they fix it? Or, are they willing to give a discount if you take it "as-is?"

Next, the kitchen is usually the next area since its often near the living room. Check all appliances - refrigerator, dishwasher, etc. Make sure they are all in working order. Ask the seller which appliances are staying and which ones they are taking with them. Check the plumbing. Run the water and make sure there are no leaks under the sink. If there is a leak, point it out to the seller and ask how long it has been going on. If you see a bucket or small bowl underneath the sink, it's a red flag. There may have been plumbing issues for quite some time. Again, ask the seller what they will do to fix the problem.

After going through the kitchen, the seller will probably take you down the hallway towards the bedrooms and bathrooms. On your way, check the heating and a/c unit (if applicable). Find out the make and model as well as the age. Is it the original unit that came with the house? Or, did they replace it? When was it replaced? Have there been any issues with the heating and or a/c unit? If so, what are they and what will the seller do to correct them?

If you see a laundry area when going down the hallway, ask the seller whether or not they will be taking their washer and/or dryer. Usually, sellers do take their units with them but there are other times they do not. If you are able to buy the mobile home with the washer and dryer unit, it adds value.

Next, view all the bedrooms. Again, pay attention to the ceiling and carpet looking for any watermarks. If you see any watermarks and/or water damage, point it out to the seller and ask how it got there. What will the seller do to fix the problem? If not, are they willing to discount the price? Look inside all the closets. Make sure all the lights work. Look underneath the beds and behind furniture to make sure there are no hidden holes or damages to the floor and/or wall.

Once you've inspected the bedrooms, you're off to inspect the bathrooms. Again, pay close attention to the ceiling and carpet (if any) looking for any water spots and/or damage. Flush the toilets. Make sure they are working properly. Run the tub. Run the water and check underneath the sink to make sure the are no leaks. Again, if you see a bucket underneath the sink it is a red flag. There has been on going plumbing issues here. Also, check the cabinet underneath the sink. Make sure the wood is sturdy and it is not rotting and/or coming apart. Usually, this is the case with particle board wood and/or wood that has water damage (i.e. leak from pipe).

After you have inspected the inside of the home, make sure you have written down everything you have noticed. If there is a back door, open it and make sure it works. This will take you outside and you will be ready to inspect the outside of the home.

Year in Review

With the start of the New Year, I've been reflecting on this past year being my first year in the mobile home business. What can I say? It has truly been a learning experience for me. I am thankful for all the people out there who have helped and supported me in this new venture.

Reflecting back on the year, I have learned many things and have made my share of mistakes. Though, I am grateful for seizing the opportunity and the experiences, both the good and bad.

In terms of my goals for financial freedom, I still have quite a road ahead of me. But, I know I can get there bit by bit. I take it all as a learning experience. With each opportunity I take, I am one step closer to creating another passive income stream which will get me closer to my goal of achieving financial freedom.

During this past year, I have learned the following:

1. The mobile home business is work - hard work.
2. Park managers are key.
3. When in doubt, ask. Though I may not know the answer, someone else does.
4. It's hard to find good people to work with. Hiring people is a skill that I have learned.
5. Without a support group, it is very difficult. Money is not everything. Cherish the ones who have been there for me.
6. Continue to learn. Be a lifelong student.
7. Have fun!

With the start of the new year, I am ready to take on the challenges that lie ahead. I have dedicated myself to continue and learn. In the end, it will truly be worth it.

Moving a Mobile Home Part II

My last post talked about moving a mobile home from one location to another. But, what happens when the home has been finally set up in the park?

Once the mobile home has been set up in the park, usually it will undergo an inspection process via your local manufactured housing authority. This inspection is just to make sure the home has been properly moved, set up and installed at the new location. Remember, find out the process and what information is needed before the move. Usually, they require a form to be filed by the mover detailing the move and the new location. Check with your local manufactured housing authority for more details.

After this inspection process, you're ready to do the hookups (i.e. electrical, plumbing, and a/c). Remember, you should have already selected the contractors you will be working with beforehand. So, what order should you do the hookups in? Well, it really depends on your area. Its best to ask the contractors how its usually handled as their work will also require an inspection by your city. Usually, the department that handles inspections for the city is the permit department. The contractors you use will need to get permits issued by the city in order to do the work. Once their work has been done, it will undergo an inspection process.

The electrical must be done before the a/c (aka "mechanical") as the a/c will need power in order to work and undergo inspection. As for the plumbing, it can be done either before or after electrical. Both electrical and plumbing are important in getting hooked up asap. Some people have tried to market their mobile homes before getting the hookups done. I would not do this - most people want to try out the electricity and the plumbing before they make a commitment.

Once all the hookups have been made and inspection has passed, the next step is to go ahead and set up accounts for the utilities. Again, some people have marketed without having electricity or water on but it will set you back. If everything in the house is working, you'll be able to find more people interested and find someone quicker. Just my experience.

Besides the hookups, the next thing important things is curb appeal. Many people start on their houses from the inside and then work on the outside. Problem is not much curb appeal. Make sure the outside of the house looks presentable. If the siding needs to be replaced or painted, get it done. If the house needs skirting, get it done. Usually, when moving home you will need skirting in the new location.

Now, this brings us to the next question. How much work is needed? Well, it really depends on the person. In my experience, I don't like homes that need too much work - that's just me. By "too much work," I mean homes that have major problems - structural and mechanical issues. I don't mind doing some floor work or maybe having to patch up a roof. Anything, that involves the structural and/or mechanical integrity of a house is just too big of a job for me. Again, it really depends on the person and exactly how much work they want to tackle.

All in all, moving a mobile home can seem like a big feat. Like all things, the first time is always the toughest. After that, it becomes just like clockwork.

Moving a Mobile Home

Many people have asked me about moving mobile homes and exactly what is involved. I know, there are a lot of mobile homes out there that need to be moved. Really, how hard could it be?

Well, I'm going to tell you it involves a lot of time and energy. If you're planning to move a mobile home, be prepared to know how to manage people because it is going to require a lot of coordinating on your part.

Before you decide to purchase a mobile home and move it, you must make sure it is in sound condition for it to be moved - it must not have any structural issues. Otherwise, you will encounter problems. I will have another post on inspecting mobile homes later on in this blog.

Once you have decided and found a mobile home you would like to move, you need to have a place to move it. Right now, I only deal with mobile home parks and have existing relationships with park managers to help fill their lots. If you are looking to move the mobile home on a piece of land, make sure you are dealing with a mover who is experienced moving homes on land and the city requirements in the area once the home has been set. For purposes of this blog, I will refer to who I use - people who are experienced working with parks.

In choosing a mobile home mover, I start by asking the park managers who they use and prefer. Usually, they use people who also do business in other parks though this is not the case all the time. I obtain their phone numbers and call them - tell them the park manager referred me. Then, I interview them and ask them questions about what's involved in a mobile home move and how they do business. It's very important to ask questions - lots of questions. Listen. The mover will ask some questions like where is the home being moved to, does it have tires, axles and a hitch already, and when do you need to have it moved. Before you make the call, you have to have all these questions answered. Otherwise, you'll have to go back and find out. Then, get a quote and call the rest of the movers on your list. Always try to get at least 3-5 referrals. Then, you want to make sure the movers are licensed for moving and installing mobile homes. For this information, you'll have to check with the local manufacturing housing authority for your area.

Once you have obtained a few quotes, I always double check their rates with the park managers. Usually, they will know the going rate in the area since they deal with these issues all the time.

After you have confirmed the rates with the park manager, I always choose the person I feel most comfortable working with - it's more of a personality issue for me. Before I set the move date, I still need to get quotes on hooking up the electricity (once in the park), the plumbing, the a/c (if you have a central air unit) and the skirting (unless you want to do this yourself).

So, how do you know the going rate for these costs? Again, you will have to talk to the park manager, get referrals, interview and get quotes, confirm again with the park managers, and finally choose. Yes, it is a very lengthy process which involves a lot of time and energy. And, we haven't even moved the home yet!

Once you figure out all the costs involved to move the home, then you must decide whether or not it will be worth it for you depending on your purchase price and plans for the home. If buying as an investment, make sure all your numbers work out in your favor so you still can profit.

On moving day, you will need to make sure all the contents in the home are secured including big ticket items such as the stove and refrigerator. Make sure the water heater is secured and drained out completely. (I've heard horror stories from people who forgot to drain the water heater during a move - it ended up tipping over and water spilling all over the floor). Also, tape up the kitchen and bathroom cabinets so they do not flap open. Remove all drawers from the cabinets and set on the carpet. In the bathrooms, take off the top of the toilet lid and wrap in bubble wrap - set on floor in carpet. To confirm your work, have the mover come in and check before the move.

Once everything has been secured and confirmed with the mover, sit back and watch. You'll be in for quite a treat watching the moving crew break down the home, jack it up like a car, and put wheels on it. Guess that's why their called mobile homes!

Make sure you call the park manager as well to make sure the lot is ready for your home. Usually, the park manager will make sure the way is clear so the home can safely enter the park and be properly set.

Once the home has been moved to the park and has been properly set and tied down, you need to check with the housing authority in your area to see if any inspections (if any) are required. Then, you're ready to start the hookups (i.e. electricity, plumbing, and a/c).

Wow, they don't call it a job for nothing! I will make another post later about the process of getting the home ready once in the park.