Wendy Patton. Unlocking the Secrets of... Lease Options & Low Down Deals 8/19/2014

Transcription

1 Sandwich Lease Options & Link Options (aka Cooperative Options) Bootcamp Michigan - July th 2014 Wendy Patton 1 Special Guests and Instructors Jim Aydelotte and Keith & Shannon French 2 Unlocking the Secrets of... Lease Options & Low Down Deals 3 1

2 Agenda Sandwich Lease Options Overview of Lease Options Sandwich Lease Options How to Find Sellers How to Talk to Sellers Working with Realtors Analyzing the Deal 4 Agenda Sandwich Lease Options Negotiating the Deal Liability Issues Handling Seller Objections/Questions Buying in Your IRA To be Licensed or Not? A Simple Retirement Plan 5 Agenda Link Options Overview of Strategy Example Deals Negotiating with Sellers and Handling Objections Initial Property Visit 6 2

3 Agenda Link Options Marketing for Buyers Social Media and Internet Marketing Case Studies Taking Your Business to the Next Level 7 Goals for Bootcamp Expand your mind to new IDEAS Get Ideas to find more LEADS Get leads so you can do DEALS! Do deals so you can make MONEY! Do a deal within 29 days! Have FUN while learning and earning 8 A L EAD? 9 3

4 About Wendy: How I Got Started Where I am today Full Time Investor 5.5 Children deals 175 in published books in US 1 published book in the UK 11 6 Keys to Success 12 4

5 Option Agreement Gives the Optionee (buyer) a right to exercise a privilege. In Lease Options - The right to purchase Real Estate at some future date with defined terms. 13 Sandwich Lease Option A contract with a seller to buy their home for a set price and set terms on a lease option. Another lease option on the same home with a tenant-buyer. You are the buyer on one and the seller on another. 14 Sandwich Lease Option Two Contracts on the same house. You are in the middle. You are the buyer on one and the seller on the other Pro-Buyer & Pro-Seller Contracts! 15 5

6 Cooperative Cooperate: to work or act together or jointly for a common purpose or benefit to work or act with another or other persons willingly and agreeably 16 Cooperative/Link Options Lease Option A contract with a seller to buy their home for a set price and terms and an assignment of the same contract to an end tenant-buyer. You keep the Option fee from the buyer. 17 Control without Ownership! 18 6

7 Real Estate Market Goes Down? Stays the Same? Goes Up? 19 The Basic Parts of a Lease Option 3 Parts of Full L/O Contract Option Agreement Rental Agreement (lease) Sales Contract 2 sets of Contracts for Sandwich LO 1 for buying & 1 for selling 1 set of Contracts for Link Options LO 20 3 Important Points If you don t ask the answer is: NO! KISS Keep It Super Simple Learn to say NEXT 21 7

8 Also Relentless Positive Action 22 Sandwich Lease Options 23 Ways to Make More $$$ Sandwich Lease Options 1) Monthly Rental Amount 2) Length of Time 3) Amount of Monthly Credit 4) Price 5) Amount Upfront 6) Mortgage Buy-Down 24 8

9 The #1 Goal is a WIN WIN WIN Seller Wins Investor Wins Otherwise Walk Away Buyer Wins 25 Overview of Sandwich Options Work well with Sellers who have Equity (never upside down!) They work well with Realtors Maybe just for cash flow

10 How to Find Sellers 28 Balancing Time and Money Only Motivated Sellers 29 Seller s Situations The WHYS! Don t need their cash out No cash to get out Main Reason = GOOD Debt relief! 2 Homes New marriage New Home Built Purchased New Home Job Transfer 30 10

11 Seller s Situations The WHYS! Other Reason = Cash Flow Burned out Landlord 2 kinds Inherited Long time owner Other Reasons Not Selling in Retail Market Etc. Move on with their life and get rid of the headache!!! 31 How to Find Sellers Sandwich Lease Options Postings ads (Craigslist) for them to call you Placing ads (newspaper) for them to call you ing ads out of Craigslist Calling ads out of Craigslist or paper Realtors Property Managers Direct Mail 32 Finding and Locating Deals 33 11

12 Finding and Locating Deals The KEY is to find MOTIVATED sellers. You must find sellers who NEED to sell, not WANT to sell. You can NOT push a rope! The difference between a motivated seller and a nonmotivated seller is TIME & CIRCUMSTANCES. Remember TIME and CIRCUMSTANCES changes peoples minds. i.e. marriage, divorce, job change/loss, death, retirement, outgrown home, home too big, burned out landlords, bankruptcy, foreclosure coming, expired listing, etc. Your ability to sort these home owners out will determine your ability to get a deal quickly. 34 Finding and Locating Deals So, how do I find MOTIVATED sellers? There are only 2 ways to find people who are interested in selling their home You contact them or They contact you. Which is better? Pros vs. Cons of you contacting them. Pros vs. Cons of them contacting you 35 Finding and Locating Deals The KEY is to find MOTIVATED sellers. The first basic principle is = getting the seller to contact you is the best method WHY? A truly motivated seller is the key to a good deal; the more motivated the seller, the better the deal. You will find very quickly, that you will be able to buy a lot more houses at much better prices. You will also get the terms you want when the seller contacts you first, especially in some of today s really hot real estate markets. You ll want to target the kind of sellers who truly need to sell as opposed to those who just want to sell. Kathy Kennebrook How to Find Motivated Sellers 36 12

13 Finding and Locating Deals The KEY is to find MOTIVATED sellers. The first basic principle is = getting the seller to contact you is the best method WHY? They are typically more motivated They are in a situation they are trying to get out of They need you you don t need them! Your posture is important!» Use posture phrases like If your house qualifies, if I m interested» Be positive, upbeat, easy to understand, pleasant to talk to, good communication skills, not sound afraid, don t be haughty, don t beg, plead, or ask twice, or be on the defensive YOU HAVE A SOLUTION FOR THEM!» If you need help with this practice practice practice! 37 Finding and Locating Deals Getting deals by contacting sellers... Wendy Patton s course... Covers all aspects of you contacting sellers and sellers contacting you i.e., Craigslist, newspapers, real-estate agents, landlords, etc. Start calling FSBO s and Craigslist ads! The #1 issue that will stop YOU from getting deals, and getting $-PAID-$ is FEAR... By making calls - if you do NOT get a deal it s great practice! 38 Finding and Locating Deals Getting Deals by Sellers contacting You... Must have at least 3 methods of advertising to drive motivated sellers to contact you Signs Ads Real Estate agents Direct Mail (Kathy Kennebrook is THE expert!) Yellow Letter Campaign* Postcards Business Cards Website Radio Word of Mouth (this will happen after you do some deals and others find out about you) 39 13

14 Finding and Locating Deals Getting Deals by Sellers contacting You... Signs: 40 Finding and Locating Deals Getting Deals by Sellers contacting You... The Yellow Letter Campaign This has revolutionized the real-estate investing world! What you need A Mailing List Blank Paper Blank Envelopes (wedding invitation size is the best) You or someone else to write them! There are companies that will do this for you 41 Finding and Locating Deals Getting Deals by Sellers contacting You... The Yellow Letter Campaign example: 42 14

15 Finding and Locating Deals Getting Deals by Sellers contacting You... The YL Campaign generates 25% return calls: Some Angry - thinking that you re invading their privacy. Some Scared - wondering why you re mailing Mom or Aunt or Grandparents a letter wanting to buy their house; Some Curious - wondering how we got their info Some Hopeful - we re going to pay them big $$$ to move them out; Some RE Agents wondering why we sent a letter to their listing; Some from Police who acknowledge we are doing nothing wrong but may ask you to consider stopping because they are taking a lot of calls about our letters; Some are MOTIVATED they don t WANT to sell their home they NEED to sell their home! 43 Finding and Locating Deals Getting Deals by Sellers contacting You... The YL Campaign generates 25-30% return calls How the numbers shake out 10% will be rubbed the wrong way 10% - will be curious 10% - will be suspects Of the 10% of suspects expect 2-3% will be a lead 100 letters will yield 2-3 leads 100/wk will yield 8-10 leads/month 8-10 leads will yield 1-2 deals At an average of $25,000/deal That s $25,000 for a $500 investment! 44 Posting Ads (Craigslist) Needed a 3 brdm home $1200 City I am looking for a 3bdrm home for local family. They are looking for a rent to own/lease option. Are you looking to sell also? If so please me if you have a home in this price range and area. It will not cost you anything to sell your home. Also send your phone number and any pictures you have of the home. Thanks, Wendy 45 15

16 Advertisement For Rent / Sale Section: Company wants 3-4 homes in this area on long term lease or purchase. (123) Advertisement For Rent / Sale Section: Is you home not selling? We can help. We buy and lease homes. (123) Placing Ads (newspaper) Same type but might be shorter Tired of Monthly Payments? We can help. Call us for a unique way to sell your home

17 ing Sellers Craigslist Ad - Response Hi I saw your home on Craigslist and it sounds like what I might be looking for. I am looking to buy a home with a rent to own or lease option to buy. Are you open to selling your home? If so, please let me know and maybe your home will be perfect for me. Also if there are more pictures or anything else you can share with me about it, that would be great. My number is xxx-xxx-xxxx. Wendy 49 ing Sellers Craigslist Ad - Response Hi I saw your home on Craigslist and it sounds like what I might be looking for. Are you trying to sell your home too? I can help. I know of a few buyers in the Metro Detroit area that want a home they can rent now and buy later. It will not cost you a dime. Please let me know if you are interested. My number is xxxxxx-xxxx. My is Wendy 50 ing Sellers Craigslist Ad Response to Agents or Property Managers Hi, I saw the home you have listed on Craigslist and it looks like what I might be looking for. Is the owner of this home willing to sell it also? If so can you send me more information on the home? I am looking for a home on a lease to own or rent with option to buy. Will that be a possibility for your seller? Any pictures or additional information would be great. Of course I would make sure you get your full commission if a seller were to sell their home to me. My number is xxx-xxx-xxxx. Thanks, Wendy 51 17

18 ing Sellers Craigslist Ad Response for Licensed Agents Are you trying to sell your home too? I can help. I work with many buyers in the Metro Detroit area to find a home they can rent now and buy later. It will not cost you a dime. I get paid by the buyer. Please let me know if you are interested. My name is Wendy and I am a real estate agent with Keller Williams Realty. My number is xxxxxx-xxxx. Wendy 52 Direct Mail 53 Calling Sellers Review Script Live Calls - Group Session 54 18

19 Getting Realtors on Your Team. Why? They CONTROL the Market! Motivated Sellers the 4 letter word How? Payment 55 Getting Realtors on Your Team. How? Payment.. Fee for Service Offices Broker Letter to get in the office Calls to Agents Letters/ s on Specific Properties Open Houses Presentation Real Estate Offices One Day at a Time - Relationships 56 Criteria for Sellers in MLS Not a Short Sale Not Bank Owned - REO On Market over 90 days Median Price Point Vacant 57 19

20 Calling Realtors Review Script Live Calls - Group Session 58 Review Sandwich Option Process and Checklist (see handouts) 59 Paperwork to Use with Sellers Main Paperwork Pro-Buyer Proposal FIRST Sales Contract Option Agreement Rental Agreement 60 20

21 Paperwork to Use with Sellers Also MUST have Paperwork Sellers Disclosure Lead Based Paint 61 Paperwork to Use with Sellers Other Paperwork Memorandum of Option Mortgage Authority aka Bank Authorization Affidavit of Owner Lien Rights 62 Analyzing the Deal How the numbers work 63 21

22 Analyzing the Deal Basic Rules Do not work in war zones Lease Option nice homes, in nice areas, and understand the market you are working Do not force any deals! Must be Win-Win-Win Do not be emotionally tied to the deal Do not burn any bridges The seller may call you later to discuss a deal! 64 Analyzing the Deal The Fundamentals of the Deal What is the ARV (After Repaired Value)? What are the comps? Does it need any repairs? What do they live near? How long has the seller lived there? What did they pay for the house? What is their asking price? What is their monthly PITI payment? Do they have any equity? How much? 65 Analyzing the Deal How Do I Get This Information? Ask! But you can ask without really asking! Use public information* You may be able to get answers such as: When the home was purchased? What the selling price? Was it listed? For how much? For how long? The more information you have, the better chances of making a deal, and knowing how to structure it BEFORE you negotiate! 66 22

23 Analyzing the Deal How Do I Get This Information? Comps: RE Agents Public Records of previously sold homes* Recent sales in the same area, of like build!» EASY in an UP market more sales, more recent» HARD in a DOWN market not good comps The ARV is the SINGLE MOST IMPORTANT number you can obtain to understand if you HAVE a deal and what your strategy is in negotiating a deal! 67 Analyzing the Deal The KEY Fundamentals of the Deal What is the ARV? What do they owe? Or find out what they paid for it What is their asking price? Are repairs needed? Are payments current? 68 Analyzing the Deal 69 23

24 Analyzing the Deal 70 Analyzing the Deal 71 Analyzing the Deal 72 24

25 Analyzing the Deal 73 Analyzing the Deal 74 Analyzing the Deal 75 25

26 Analyzing the Deal 76 Analyzing the Deal Remember - KEYS of the Deal are What is the ARV? What do they owe? Or find out what they paid for it What is their asking price? Are repairs needed? Are payments current? 77 Analyzing the Deal Common Mistakes Trying to work with unmotivated sellers Giving a seller too much down just to get the deal Working with low priced properties Work with homes that are 80% of median prices and above Working with houses that need too many repairs Working with problem homes i.e. too small, bad location, functionally obsolete Agreeing to make payments too soon Not asking for additional benefits Allowing seller to squeeze you out of your front end Just because they want something does not mean you have to give it to them 78 26

27 Analyzing the Deal Nothing Else Matters Until The prospect passes this hurdle. Some will, some won t, so what, NEXT It s a numbers game The more people to talk to The more offers you can make The more deals you will have. The more NO s you get the more YES's there are! Are you willing to get 50 no s for 1 yes? 79 Analyzing the Deal Nothing Else Matters Until The prospect passes this hurdle. Some will, some won t, so what, NEXT You can very quickly tell the answer to Will they give equity away? Is there enough in it for me? Will repairs reduce equity and scratch the deal? Could this be a short sale or foreclosure? Are there too many liens? Let s look at 4 real life deals that I ve done 80 Analyzing the Deal What Do Some Deals Look Like? Oakwood St Owosso, MI 3 Bed 1 Bath 1250 SF ARV = $75,000 Seller owed $78,000 Price $79,000 - $780/mo $75/mo Rent Credit Lease $88,900 - $830/mo $60/mo credit to tenant 81 27

28 Analyzing the Deal What Do Some Deals Look Like? Profit $4,500 Front End $5,400 Back End $1,560 ($65/mo 24 mo) Total = $11,460 Oakwood St Owosso, MI 82 Analyzing the Deal What Do Some Deals Look Like? Mackinaw St Durand, MI 3 Bed 1 ½ Bath 1500 SF ARV = $74,000 Price $67,000 - $650/mo $100/mo Rent Credit Lease $82,900 - $850/mo $50/mo credit to tenant 83 Analyzing the Deal What Do Some Deals Look Like? Profit $3,500 Front End $12,400 Back End $6,000 ($250/mo 24 mo) Total = $21,900 Mackinaw St Durand, MI 84 28

29 Analyzing the Deal What Do Some Deals Look Like? M-52 Perry, MI 5 Bed 4 Bath 1850 SF ARV = $185,000 Price $171,000* - $1,300/mo* (*Mortgage = $183,000 with $1,625/mo monthly payment) $250/mo Rent Credit Lease $192,900 - $1,435/mo $170/mo credit to tenant 85 Analyzing the Deal What Do Some Deals Look Like? Profit $10,000 Front End $11,900 Back End $4,920 ($205/mo 24 mo) Total = $26,820 M-52 Perry, MI 86 Analyzing the Deal What Do Some Deals Look Like? Knoll Ct. Corunna, MI 5 Bed 4 Bath 3000 SF ARV = $184,000 Seller owed $160,000 Price $160,000 - $1,200/mo $2,500 Down to Seller $120/mo Rent Credit Lease $189,900 - $1,500/mo $100/mo credit to tenant 87 29

30 Knoll Ct. Corunna, MI Analyzing the Deal What Do Some Deals Look Like? Profit $7,500 Front End ($10,000-$2,500) $19,900 Back End $11,520 ($320/mo 36 mo) Total = $38, Analyzing the Deal What Do Some Deals Look Like? N State Corunna, MI 5 Bed 2 Bath 20 acres 1800 SF - 60x40 pole barn ARV = $230,000 Price $80,000* close Mortgage = $135,000 $1,075/mo $1,250 Down to Seller $150/mo Rent Credit Lease $249,900 - $1,595/mo $100/mo credit to tenant 89 Analyzing the Deal What Do Some Deals Look Like? Profit $11,250 Front End $34,900* Back End $20,520 ($570/mo 36 mo) Total = $66,670* N State Corunna, MI *Total amount of profit increases the longer property is leased, as principle decreases. Currently 7 years is the term

31 Negotiating the Deal 91 Negotiating the Deal Basic Rules You are NOT guaranteeing the mortgage you are only taking over the payment and maintenance! Most all mortgages can not assumed. You can t promise cashing out, or when you will, so don t make promises you can not keep! Don t lie, stretch the truth, or exaggerate Your word is your worth your worth is your word! It s better to lose a deal, then your integrity or a court battle 92 Negotiating the Deal Example of a Lead 4 Bed 1 ½ bath in nice part of town ARV = $135,000 Owes = $110,000 Monthly PITI = $850 Needs no repairs Wants to move ASAP Payments current, but may start to get behind They want out of mortgage, with $5,000 cash. Any volunteers to role play? 93 31

32 Negotiating the Deal Key Questions - to work into the conversation: Will they sell the home for what they owe?** If I had your house appraised, what would it be worth? What are houses like yours selling for in your neighborhood? If I paid you all cash, and closed whenever you wanted to, what would be the least amount that you could take for the house? The BE QUIET! - until they tell you! Follow up by clinching you teeth, breathing in, and saying Is that the best you can do? So, if I hear you right, if you don t get $ for the house, we do not have a deal? If I hear you right, if I give you $ for the house, we have a deal? 94 Negotiating the Deal What Should I Offer? In practice it s much easier to make offers on nice homes than junkers! You usually need little to no cash The debt comes with the home It s simply a matter of taking over the debt Then work out how the seller gets paid for their equity if there is any? Remember! Many times the seller will get no $$$ So making offers becomes very easy. They just WANT OUT from under the house! 95 What Should I Offer? Negotiating the Deal ARV = $135,000 Owe $110,000 PITI = $850/mo Wants $5,000 to get out Example of Offer 1: $110,000 $2,500 (from Tenant/Buyer down payment) $2,500 cash at closing 96 32

33 Negotiating the Deal What if they Yes??? Sell the home on contract: $144,900 $7,500 down min (leaves you with $5,000) $995/mo Your profit? $5,000 Front End ($7,500 - $2,500) $3,480/mo 24 months) $24,900 Back End ($137,400 - $112,500) TOTAL = $33, What Should I Offer? Negotiating the Deal ARV = $135,000 Owe $110,000 PITI = $850/mo Wants $5,000 to get out Example of Offer 2: $115,000 price on contract $2,500 (from Tenant/Buyer down payment) $0 cash at closing 98 Negotiating the Deal What if they Yes??? Sell the home on contract: $144,900 $7,500 down min $995/mo Your profit? $5,000 Front End ($7,500-$$2,500) $3,480/mo 24 months) $22,400 Back End ($137,400 - $115,000) TOTAL = $30,

34 Negotiating the Deal What Should I Offer? ARV = $135,000 Owe $110,000 PITI = $850/mo Wants $5,000 to get out Example of Offer 3: $120,000 $0 (from Tenant/Buyer down payment) $0 cash at closing 100 Negotiating the Deal What if they Yes??? Sell the home on contract: $144,900 $7,500 down min $995/mo Your profit? $7,500 Front End $3,480/mo 24 months) $17,400 Back End ($137,400 - $120,000) TOTAL = $28, Negotiating the Deal Why Make Multiple Offers? It allows the seller to tell you what s important to them! This is KEY and allows you to zoom in on the deal quickly! People love different options. It gives the seller the ability to make the decision. This creates a non-confrontational sale, still give you control of the situation. It makes you a Transaction Engineer

35 Liability Issues Who carries insurance? 103 Handling Seller Objections 104 Questions and Objections Buying Signal 4 Things on Handling Listen carefully Empathize Clarify Discuss solution or give the answer Handling with Link Options

36 Handling Seller Objections Rule #1 Objections are good! This shows that the seller is thinking! Rule #2 Objections give you a window into the seller s concern s. Knowing what concern s them gives you the ability to over come them! Rule #3 Always work to overcome objections BEFORE they arise! In the course of your discussions, and what you can and can not do for them be sure you anticipate their concerns, and overcome them. 106 Remember! Handling Seller Objections Never make promises that you can not keep, and get it in writing that you didn t make any! It s better to lose a deal than your integrity or a court battle! Handling objections is 75% of this business! Learn how to, and you will be successful! If you tell is like it is, and don t lie to get your way, you will then be doing business only with people who wish to deal with you, and you won t have to remember whom you lied to last - Ron LeGrand 107 Handling Seller Objections Concern #1 What if the tenant tears up my home? First - In the course of conversations with the seller, I will repeat the comment that all maintenance and repairs are my responsibility. Second - If the question comes up after that, I will point out that our contract says that I am responsible, and I will fix it at my expense. Remember, Mr. and Mrs. Seller we re not dealing with renters we are screening tenant/buyers who will eventually qualify for a loan, and these folks are rarely a problem, so they want to take care of the house. But if not like I said, I ll take care of it all per our contract. Will this work for you?

37 Handling Seller Objections Concern #2 When will I get cashed out? In the course of my conversation with the seller, I will repeat the comment that On average, it will take between months to get cashed out, but I can t give you an exact time. I can promise you that I will make your payments, and guarantee the maintenance until I do. Will that work for you? 109 Handling Seller Objections Concern #3 Why not just list it with a realtor? In the course of my conversation with the seller, I will make the comment that Unlike a realtor, and while you are waiting to be cashed out remember, you are not paying me for my services, and I will be making your payments and guaranteeing the maintenance until I do. This will allow you to forget about the property, and move on with your life. No realtor in the world will do that! Will this work for you? I will also weave into my conversations with the seller, that I usually have several people who would be interested in their property, and could be set up within the next 30 days, but if you go with a realtor you will be making payments for 3-6 months or more which comes out of your pocket. 110 Handling Seller Objections Concern #4 But I need my money now! This is a common misconception by beginning investors, as they can not believe a seller will let you control their property. Remember they don t WANT to sell their house, they NEED to sell their house. If it comes up remind them that if they sell through a realtor, the home will be vacant, and they will be making the payments, and they can not move on with their life until it sells, which is on average days in this market. If the seller has a large % of equity, this question may arise, so be ready for it. In addition, point out that if they sell with a realtor, they will not make as much as if they sold it to you on contract, and crunch some numbers to show them

38 Handling Seller Objections Concern #5 Can my attorney review the contract? Absolutely! No problem! If they have anything they feel needs to be changed please have him/her let me know. If he/she says it s good, do we then have a deal? 112 Handling Seller Objections Concern #6 How do I know you will make my payments? There are several ways to handle this. You can offer to pay them directly, so they can make the payment. This is ONLY if the seller has equity and money when it sells. You can offer to set up a third party escrow company to collect the payment and pay it for you. This service costs money and the seller should pay it if they insist. You can pay the lender directly and you ll know right away if I m late as you will receive a late notice. If the seller has no equity, and will most likely not get cash at closing then you should always pay the lender directly. 113 Handling Seller Objections Concern #7 Why do you want such a long term for the lease option? Because sometimes it takes a tenant/buyer a while to qualify for various reasons, like raise money for a down payment, or get their credit fixed from some problem. Be sure to stress that you will be making the payments and taking care of the maintenance during the entire term of the contract Your response should be a question How long do you want me to make your payments and take care of the maintenance? Many times I ve had sellers say As long as possible Then get it for 10 years 5 years at the very least!

39 Handling Seller Objections Concern #8 How do I know you will get my house sold? Well, as you know, I want to get your house sold as quickly as I can and the reason why is because, I m willing to spend my time and money giving you my best effort, because I don t make a dime until I do. Therefore, I m taking the risk, and since you don t pay me there is no way you can lose. If I sell you get paid and get your cash, if I don t, I m out my time and costs. Stress to the seller that you will be making the payment even if the tenant/buyer has to leave, and you find another tenant/buyer you are still making the payment, and taking care of the maintenance. 115 Handling Seller Objections Remember the key to handling seller objections is anticipating them before they come up! By weaving these probable objections into your conversation with the seller, you will reduce their concerns, and make the deal much easier for them. 116 Handling Seller Objections Advantages to the Seller: Debt Relief (#1 motivator) No management No repairs Retain ownership Retains tax benefits until sold Gets cash at closing Avoids problems with the mortgage company (i.e. Due on Sale clause) Saves their credit Gives them positive cash flow Allows them to make more on the property vs. selling with a realtor (if they can wait for it)

40 Handling Seller Objections Is this really worth my time? If one deal produced $3,000 from deposits, $250/mo on payment spreads, and $15,000 additional cash upon sale That s $20,000/deal If you did 5 deals the first year that s $100,000 in profit for one deal every 2.5 mos. What if you did 1/month for 12 months? What if you did it for 3 years? QUIT MAKING EXCUSES and DO IT! 118 Finding and Screening Buyers 119 Paperwork to Use with Buyers Main Paperwork Pro-Seller Sales Contract Option Agreement Rental Agreement w/pet Agreement Sellers Disclosure (copy from Seller) Lead Based Paint (copy from Seller) NO bank authorization NO memorandum

41 Keeping Updated on Buyers Credit repair company requirement! Is the Tenant doing their part? Mortgage broker following up? 121 The Closing Table Double Closings Transactional Funding 90 Days on Title New Contract with Lien 122 Sales Contract Clause Get local legal advice Seller agrees to work with the buyer to make this agreement work for both parties in anyway possible to meet lending guidelines. This includes but is not limited to: restructuring the paperwork to meet lender requirements for the buyer or whomever the buyer has sold the property to, or signing a new agreement with the buyer s buyer for a different price and allowing the buyer to put a lien (for their profit amount) on the property to be paid at closing so the buyer can receive their profit, if any, on this property. Any changes required to make this agreement work will not cost the seller any more money, as any expenses will be incurred by the buyer

42 Keeping Organized Folder System Follow up 124 Buying in your IRA Build for your future Tax FREE! Education IRAs 125 Summary Buy from sellers moving up in life Sell to buyers moving up in life Option fee to Realtors: 1%+ in buyer s market up to 3% in strong seller s market Option fee from buyers: 1-2% in buyer s market (maybe 2-5%) 3-5% in strong seller s market

43 Summary Sandwich Options Work only with Motivated sellers Buy long term 3-5+ years Sell short term months Determine your goal for profit Remember WIN/WIN/WIN Go out and work The System! 127 To Be Licensed or Not To Be Licensed? 128 To Be or Not to Be Licensed The Pros & Cons Pros Shows expertise in area/credibility Commission Your deals and others MLS access for comps Access to homes to view Training on sales and prospecting Referral Fees Presenting own offers to sellers Health insurance at group rates You are one of them

44 To Be or Not to Be Licensed The Pros & Cons Cons May have to pay Broker for deals Using state documents Considering? me to discuss if Keller Williams is right for you 130 The Ethics of it All & Watch out For Keep it good for all win/win/win for everyone Do they have a realistic chance of getting a mortgage in 1-2 years? Would you put them in your home? Set them up for success Treat them like customers Full disclosure & be accessible 131 We All Need Affordable Legal Protection

45 Retirement Plan Overview 6 per Yr 4 per Yr 3 per Yr 2 per Yr 1 $38,400 $26,000 $19,200 $13,600 2 $77,800 $60,600 $50,600 $43,400 3 $136,200 $118,600 $80,800 $72,800 4 $143,400 $125,800 $82,800 $73,000 5 $149,800 $141,800 $85,000 $73,000 URG $500,000 $350,000 $200,000 $125,000 Properties cashing out on avg. in 24 months - in this example at the same rate they are added 133 Retirement Plan Overview SLO - Deals/yr vs. Annual Potential Avg. = $200/mo spread & $30,000 Equity Annual Income $150,000 $140,000 $130,000 $120,000 $110,000 $100,000 $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 $13,600 $19,200 $26,000 $38,400 $43,400 $50,600 $60,600 $77,800 $72,800 $80,800 $118,600 $136,200 $73,000 $82,800 $125,800 $143,400 $73,000 $85,000 $141,800 $149, Years 2 Deals/yr URG=125K 3 Deals/yr URG = $200k 4 Deals/yr URG = $350k 6 Deals/yr URG = $500k 134 Introduction Keith and Shannon French (One of America s Top Power Couple RE Investing & Coaching Teams) Combined 20 yrs Fortune 500 experience Over 1,500 hrs & $150k in RE education Full time RE investors, speakers, coaches & entrepreneurs since RE transactions (They ve done it all!) (short sales, rehabs, fix & flips, buy & holds, wholesales, sandwich LOs, Sub-To s, Link Options/Cooperative Options, private lending, land trusts, land installment contracts, etc.)

46 Introduction Specialize in Link Options / Cooperative Options Capitalize on Multiple Streams of income within this Niche Strategy Operate with an EXTREMELY LOW OVERHEAD BUDGET Make a Very High Six-Figure Income from RE Biz LIFEonaires for 5 ½ years! 136 Let s Welcome Keith and Shannon French! 137 What We Do! We ve designed our businesses around our lives, and help other people do the same Full time entrepreneurs since 2005 Do Link Options transactions each month Titanium level Lifeonaire coaches

47 What We Do! Coaches & speakers on our debt free real estate investing strategy, Link Options RE related internet and affiliate marketing Invest excess cash for passive income Take lots of time off Days Agenda Explain our Link Options strategy Cover the benefits of this business Working with and without a license Types of properties to look for Marketing for sellers & buyers Negotiating the deal Paperwork involved Lifeonaire How to start your own Link Options business 140 Why Link Options? Provides Quick & Consistent Cash Injections Involves Little to No Risk Needs very little money to operate Requires no OPM or credit Helps many people and is a very happy positive real estate strategy!

48 Why Link Options? Needs no cash buyers or current credit qualified buyers Doesn t rely on closings to get paid Works for Non-Distressed sellers & houses Can be done virtually from anywhere! 142 What is a Link Option? It s simply linking a seller to a future buyer via a Lease with an Option to Buy Contract and getting paid to assign the Option! 143 Seller Leads are Everywhere! It s a strategy that will apply to 75%+ of your seller leads & the majority of buyers Most, if not ALL other investors toss these seller leads into the TRASH!

49 Terminology We use these terms interchangeably: Lease Option Lease with an Option to Buy Rent-To-Own (RTO) Rent-To-Buy Rent-To-Sell Wholesaling Lease Options Cooperative Option Link Option (NOT Lease Purchase which is different!) 145 Terminology We use these terms interchangeably: Option Fee, Option Consideration, Option Down Payment, (Down Payment) Tenant-Buyer/TB, Optionee, Tenant, Renter, (Buyer) Rental Agreement, Lease, Lease Agreement Optionor, Owner, Landlord, (Seller) 146 Evolution of Link Options Liked Sub-To s & Sandwich LOs, but NOT: Guaranteeing payments Being legally and monetarily vested until the TB purchases Dealing with market fluctuations during the lease term

50 Evolution of Link Options Enjoyed traditional wholesaling, but NOT: Estimating repairs Finding and maintaining cash buyers Waiting on closings 148 Evolution of Link Options Combined traditional wholesaling & sandwich lease-options, but eliminated the potential risks and headaches all together! 149 Evolution of Link Options Rehabbing, short sales, and land-lording were just too: Time consuming & complicated Risky with unpredictable random variables Unpredictable with cash flow Much of an energy drain!!

51 Link Options has allowed us to Build a Business around our LIFE so we can do what we want, when we want DEBT FREE! 151 We Only Have to Work ~ 35% of the Year! 152 Chrysalis, the Chow Chow goes everywhere with us!

52 Moved From Baltimore, MD to Small Town Monroe, LA! 154 General Market Comments Few A credit & income qualified buyers Competition on MLS, = < Max Sales price Buyers & Sellers are open to win-win alternatives Numerous sellers are tight on equity Many sellers can t sell & many buyers can t buy 155 Most Potential Buyers Fall into the Middle of a Bell Curve A Credit or Cash Buyers This is our target buyer population! Long- Term Renters

53 Marketing for Sellers 157 Keys to Effective Marketing Consistency!!!! don t give up, follow through, and keep experimenting Have a MIN of 3 types of marketing going at all times! Focus on Motivated sellers, but Non- Distressed sellers and houses 158 The Link Options Strategy Works in Any Market Whether the market is up, down, or stagnant, it doesn t matter: Link Options works! Even in highly appreciating markets

54 Typical MLS Transaction Results Typically, these things affect the seller s net from the MLS list price: Conservative pricing to get offers (5-10%) Offer is not full price (5-7% discount) Seller concessions (3-6%) Realtor commission (5-6%) Repairs from home inspection (1-2%) Closing costs split 50/50 (0.5% to 3%) Typical Net Sales Price ranges from 80%-85% of what the seller wanted to net!!! 160 Seller Benefits You come in with a solution for sellers: Full asking price (typically 100%, or very close to what they wanted to net) No Direct Costs to them An AS-IS sale, and Are Not An Exclusive Listing! The seller has nothing to lose by trying your service! 161 What Types of Sellers Are We Looking For? Motivated, but NOT Distressed Doesn t need to have tons of equity, but can t: Be under water, Behind in payments, or Need cash fast

55 What Types of Sellers Are We Looking For? Can be their primary OR investment property Doesn t matter if it s listed with a Realtor* *Must get Realtor s cooperation and permission to market the seller s property 163 What Types of Houses Are Best for a Link Option? Homeowner neighborhoods Not rent-only areas First time home-buyer and step up neighborhoods Median to a little above prices For MD ($125K to $350K) < sweet spot Low end changes from homeowners to renters High end is where your market rents cap out (all depends on your market) 164 What Types of Houses Are Best for a Link Option? Move-In ready homes (the nicer the better) 3+ BR / 1.5+ BA Typically, SFD are easier than Town Homes Vacant with Lockbox Occupied properties are typically cluttered and harder to coordinate showings

56 Tougher, but doable properties High Rise Condos Less than 3 BRs Homes Significantly Below and Above Median for your area (MD $100K/$500K) Location is too Far Out House Needs Some Repairs 166 Top Marketing Strategies Yellow Letter Do it yourself or outsource Our two favorite lists are Absentee owners Expired listings MLS and/or a list broker like Yellow Letter

57 Lead Generation That Works! Yellow Letters 169 Top Marketing Strategies CraigsList (for Rent and FSBO) Manually & text yourself Cold call Hire someone to do it Scraper software 170 General Craigslist Search (Baltimore) realtor, - realtors, - apartment, - condo, etc

58 & Text to a Craigslist Posting Hi, Would you be interested in selling your home, advertised on Craigslist, on a lease with option to buy (rent-to-own) to one of our qualified tenant-buyers? If so, please let me know. Thanks, Keith 410-xxx-xxxx 172 Top Marketing Strategies Bandit Signs & Car Marketing driving people to a squeeze page, website, or phone number 173 Roadside Signs that lead to a Squeeze Page

59 Top Marketing Strategies WordPress website that will rank in search engines Internet Marketing and Social Media Will help you rank high in Google in your local market Other investors trash leads Realtors & Mortgage Brokers Eventually, referrals will kick in BIG TIME 175 BENEFITS You can do as many deals as you want and fit this business around your life style 100% of this business can be done virtually, without ever having to see the house or meet the seller & buyer 176 BENEFITS Today, we operate a very high six-figure income business in MARYLAND from our home in LOUISIANA...without any VAs or assistants anywhere!!!

60 We run a full time business 1200 miles away! Our business is here! We live here! 178 BENEFITS You don t have to worry about: Your credit Borrowing or raising money from anyone Guaranteeing and making payments Property repairs or maintenance Unexpected expenses Property taxes & insurance Needing a lot of money to get started 179 Link Options Help Everyone! Sellers net 100% or close to their asking price! Not 50%-70% (or less) from cash offer Not 80%-85% (or less) from MLS Renters become Home-Owners! You help set new HIGH COMPS in neighborhoods!

61 Link Options = Great Cash Flow $$$ with Little to No Risks!! An Average Option Fee is between $5,000 and $6,000 per deal and these deals are everywhere!!!... 1 per month = $60,000 - $72,000/yr 2 per month = $120,000 - $144,000/yr 3 per month = $180,000 - $216,000/yr 4 per month = $240,000 - $288,000/yr 5 per month = $300,000 - $360,000/yr Remember there is very little operating overhead, so it s practically all profit!! 181 So, Do We Have a Course to Sell??? 182 of Course we do!!! We want everyone in this room to experience the lifestyle you desire! and So Does Chrysalis!!

62 Hey Keith and Shannon! Testimonial - Jerry B. Wanted to let you know I closed my first deal this week. I saw Wendy Patton a few hours later at our REIA meeting and told her this was one of easiest strategies to implement from start to finish. Thanks to you and Shannon for the detailed videos. It helped me to connect the dots. I can easily see doing 1-2 deals a month even with my schedule. It took about six weeks from the time I ordered your course to close my first deal. My goal was 60 days so I hit that with time to spare. Have a great night and thanks for your detailed work with the link options course. 184 Jonathan F. Testimonial To anybody who is on the fence about going full force into this business, trust me, this is the way, and so is this course. This course teaches you how to be an actual player in the real estate investment business. I say this because many investors are not familiar with this way of structuring lease option transactions and making it work. 185 Jonathan F. Testimonial Truth is, you don t have very much competition, and a lot of your competition is not doing these deals the right way. Shannon and Keith teach you how to do it the right way and make it a legitimate business model. More importantly, this is a gateway strategy that allows you to capitalize on other real estate investment opportunities

63 Jonathan F. Testimonial From my own personal experience, if it weren t for this course and Shannon and Keith s accessibility with answering questions, I wouldn t have had the confidence to put my thoughts into action and take that first step into this business. Now, I m going out finding sellers, and have established local partnerships/mentorships that I know will help fuel my success in this business! Thank you! Jonathan 187 Yes, there is a SPECIAL BONUS for buying at this boot camp!! We will cover all that at the end of our boot camp! So What s the Price??? $1,497 You Should Make 3-4X+ this on your FIRST deal!!!! 188 Steps to Link Options 1. Marketing, marketing, MARKETING for sellers 2. Seller and you sign: Cooperative Lease Option Agreement Option Agreement + Addendums Sales Contract

64 Steps to Link Options 3. Marketing, marketing, MARKETING the property for rent-to-own/lease-option to tenant-buyers 4. Find a TB & pre-qualify them (Put the TB in credit repair if needed) 5. Get funds in escrow option fee and full first month s rent 190 Steps to Link Options 6. Assign paperwork to TB 7. Rental Agreement/Lease signed between TB and owner 191 Steps to Link Options 8. Get Paid! Disburse the upfront option consideration to your company as your fee (non-refundable*) *Refundable from seller (not you), only if seller breaches the contract

65 Steps to Link Options 9. Disburse to the seller, full 1st month s rent 10. Move onto the next deal Repeat, Repeat, REPEAT! 193 Real Deal 194 Notes to Remember You can easily work with other Agents & everyone gets paid Keep actively networking with Investor-Friendly Agents, especially their challenged listings Listen to TB s needs and desires Appraisals are Unpredictable

66 Real Deal #2 1. Seller Source: Owner s Craig s List Ad for Rent ARV $210,000 - nice homeowner neighborhood Current renters were moving out Sellers OK w/either a strong renter or a TB whichever came 1st Sellers in Costa Rica for last 3 years 2. Tenant/Buyer Source: Zillow (via vflyer) -- Job relocation and under a deadline -- Husband saw in person, but wife relied on YouTube video -- Short on the asking down payment, but strong income 3. $2,200 Down & $ /mo -- $209,900 purchase price -- $ EXTRA added to down payment each month -- After 18 months: $9, down, Seller getting $3, $6,400 total Profit ($2,200 up front & the rest over time) 5. All communication w/sellers & TBs done via Skype, , phone, and fax 196 Down Payment Over Time Typically, we don t like to do down payments over time In 95% of our deals, we get the full down payment upfront 197 Link Options are Flexible RTO is designed to be very flexible Use judgment when creating an atypical arrangement Consider the circumstances Disclose everything & have seller make final decision

67 Link Options are Flexible For example, in this situation Sellers were willing to take a renter Sellers wanted to keep some personal items in the house longer TBs had strong income and were very diligent throughout the entire process An atypical arrangement, but everything was disclosed & everyone was happy 199 Working Without a License We strongly urge you to get your real estate license! and depending on your State, you may HAVE TOO! 200 Working Without a License If you don t want to get your license, then: FIRST, determine if you can function as a principal in the transaction without a license in your State? You SHOULD get an attorney in your State to advise you!

68 Working Without a License If you don t want to get your license, then: Build a good rapport with a Realtor who will work with you Bring on a partner who is licensed Disclose that you are NOT an agent 202 Working Without a License If you don t have a license DON T EVER: Attempt to operate as a principal in a State where this is prohibited Represent yourself as licensed or indirectly lead anyone to believe you are Market to Realtor-only listings Market a house that is already listed with a Realtor, without getting permission 203 Working Without a License If you don t have a license, then DON T EVER: Take a Realtor s sign down Put your sign up in the seller s yard alongside the Realtor s sign Abuse your MLS access; Don t List properties in the MLS, or Share your password with anyone

69 Seller Negotiating Tips Ask Questions Listen Understand Empathize Clarify 205 Talking with Sellers Key points in conversation Find out what they NEED Ask what they have tried to do to sell and/or rent the property Find out if it s listed with a Realtor Be confident, not desperate, and positive It s not about you, it s about them and how you can help! 206 Talking with Sellers Tell seller the good news the benefits Full price offer As-Is sale Typical seller nets 20%+ over traditional sale No out of pocket costs for service Not an exclusive listing agreement We have NEAR-BANK qualified TBs now Repairs & maintenance handled by TB TBs make better occupants than rent-only tenants

70 Key Conversation Points Keep it simple Build rapport & trust Get some more information about the home Ask about the price points they need 208 Key Conversation Points Don t feel pressured to close them on the phone Get them to say yes to scheduling a time to meet at the house At least get them to commit to you sending them more info in an 209 Follow up to Sellers Summarize the benefits of your service Provide them a link to your website Give a link to a YouTube video of you explaining the lease-option program Ask the seller how they want you to follow up with them BE SURE TO FOLLOW UP IF YOU DON T HEAR BACK FROM THEM IN A DAY OR SO!!!

71 Powerful Information Send the seller a Comparison Spreadsheet: What they would make Selling through a Realtor vs. Rent-To-Sell 211 Selling Traditionally vs Selling Thru Link Option How Much Is A Little Flexibility Worth? Average Net Selling Via Realtor Average Net Selling Via RENT-To-SELL Full Retail Market Value $ 330, $ 330, Full Retail Market Value (Priced competitively/not full retail) List/Asking Price $ 320, $ 330, List Price (Full retail value) (Offers average 93% of Asking) Selling Price $ 297, $ 330, No Low Ball Offers! Realtor Commission $ (14,880.00) $ (13,200.00) Tenant-Buyer Down Payment (Average range: 5-6% of Sales Price) (Average 4%--our fee) Seller Help $ (17,856.00) $ - No Seller Help! (6% maximum allowed) Seller Closing Costs $ (5,952.00) $ - Tenant-Buyer pays ALL Closing Costs (2% average depends on County) Requested/Required Repairs $ (2,976.00) $ - Tenant-Buyer takes AS-IS (1% average) Gross Sale 255, $ 316, $ Gross Sale Percentage Percentage of Asking Price 80% 99% of Asking Price Percentage of Retail Value 78% 96% Percentage of Retail Value Subtract Loans $ (250,000.00) $ (250,000.00) Subtract Loans NET TO YOU! $ 5, $ 66, NET TO YOU! Difference! $ 60, Difference! 212 Answering Objections Sometimes you just can t satisfy a seller or overcome their objections. It s doesn t happen very often, and it s okay! Move on to the next one

72 Answering Objections Don t panic if you get stumped It s okay to respond: That s a great question. I have a couple thoughts, but let me get back to you tomorrow after I discuss this with my business partner. Try to understand what their true objection is about? 214 Questions and Objections I don t want to be a landlord! I dislike renters! 215 Questions and Objections What if my home goes down in value?

73 Questions and Objections Why would I RTO vs. sell outright? 217 Questions and Objections What if they don t buy? (I really love this when they are marketing the house for rent already) What if they tear up the house? What if they don t pay the rent? 218 Questions and Objections How do you get paid? Do I get part of the Option Fee?

74 Questions and Objections What if I rent it first? What if my Realtor brings me a renter or buyer? May I list with a Realtor? 220 Common Seller Objections and Questions How do you set the purchase price and the monthly rental amount? Why can t your clients just purchase now? 221 The #1 Goal is a WIN WIN WIN Seller Wins You Win Otherwise Walk Away Buyer Wins

75 Scheduling Initial Property Visit When first starting out, go to the property yourself! If doing remotely: Get paperwork signed before you pay for someone to take pics and a video Alternatively, you can get the seller to take pics and put a lock box on the door (that s what we do!) 223 Paperwork Needed Before Marketing to TBs Assuming you are in a State where assignments are legal: Cooperative Lease Option Agreement Option Agreement Sales Contract if Necessary 224 Other Necessary Paperwork Addendums Will need prior to assignment to TB: Seller Disclaimer & Disclosure Lead Paint Addendum Other misc addendums (e.g., HOA) Authorization to Release Lending Information Affidavit of Liens Memorandum of Option*

76 Initial Property Visit Property Information Worksheet (fill out as much as possible, and leave with seller to complete and fax/ back to you) Home layout and all amenities Community/Neighborhood features HOA info, if applicable 226 Initial Property Visit Property Information Worksheet (cont.) Talk about a Home Warranty Discuss any rental requirements lead certificate, rental license, etc. Review comps and confirm option price and monthly rent 227 Initial Property Visit Other things to bring with you Seller Packet Digital camera Video camera this will help brand you more than anything else

77 Video is a Powerful Free Marketing Tool for Branding your Business! 229 Finding the Buyers 230 Qualifying Characteristics of TB Down payment MIN of 3.5% or $5K, whichever is greater Of course, the more the better!!! Willing to enroll into credit repair (Sign up now and you re set) Ability to save up for future closing costs Less any Seller credits est in RTO agreement

78 Qualifying Characteristics of TB Income supports the future loan (3-4x rent) Lendable debt-income ratio Good job history (2 yrs same work) Acceptable rental & background check High probability of bank loan in 18 mos or less 232 Give your Buyers Choices Build an Inventory of Homes - Don t just get one house, and then quit trying to find sellers 233 Steps to Start Marketing for Buyers Get your pictures and video ready Get an account with Craigslist and Use the code buybaltimore to get a discount on the paid version Setup a FREE website or have one hosted for about $5/month At a minimum, setup a FREE YouTube, Google+, and Facebook account

79 Marketing On a Shoestring Budget During startup, plan on $100 - $400/mo ~ $100-$250/mo marketing for sellers (direct mail/yellow Letters, Bandit signs/car marketing, Craigslist marketing) ~ $25-$75/mo marketing for buyers (vflyer and Bandit signs)! ~ $5-$50/mo for website, squeeze page, CRM database hosting Today, we spend < $50/mo (use mostly FREE stuff) 235 Roadside/Bandit Signs - In front of the property - Around the neighborhood that point to the property (10-20 per house) - General signs that drive buyers to a website or squeeze page 236 Squeeze Pages/Lead Capture Sites Lead Generation Websites Explanatory Video > Written Info > Lead Capture Form > (Populates a CRM / Database)

80 vflyer automatically posts to all of these other popular property listing accounts Most of our buyer leads come from Zillow, Trulia, and Hotpads! Each flyer has it s own unique URL Links to social media Links to website Links to video Has picture gallery Create different layouts Print out fliers Can share it via Can use instead of a website Tie Social Media to WordPress Site

81 The Power of WordPress Google Maps Plugin Opens New Page for Each Listing And YouTube Video Social Media Links 241 YouTube Testimonials on WordPress YouTube Testimonials 242 Use to Post to WordPress Just take the embed code right off of vflyer and save hours posting to WordPress!!

82 Put Your Property Videos on YouTube Notice the playlist with all of our RTO videos 244 You can or post this playlist link anywhere for people to view all of your listings Have a Playlist for all of Your Active Rent-To-Own Homes Get your Playlist link here 245 Social Media Ranks High in Google Especially, any postings made to YouTube and Google

83 #1 #4 247 Google owns YouTube and videos help you rank high and fast in organic searches 248 What to Put in Your Property Ads? Unique selling features of the home Remember the Property Info Sheet! Several pictures & a video Local phone number (Google Voice) Link to your website w/list of properties Flexible terms for strong applicants

84 What to Put in Your Ads? The rent, rent credits (if any), and option price Advertise the minimum option consideration (% and $ amts) Challenged credit is okay! 250 Take Calls and Manage s Post to vflyer, Craigslist, social media, and put out signs and get ready!!! Have all calls come into a local Google Voice number (voice.google.com) Forward to a call service if you can t answer the phone Organize folders by property and track buyers somehow 251 Answering TBs Questions How does your program work? Is bad credit okay? Can you help with credit repair? How long do I have to purchase?

85 Answering TBs Questions What s this down payment/option fee? Do I need all money upfront? Do you check my credit? Does any of the rent go towards the house? 253 Text & Follow UP If you are not able to call your tenantbuyers back immediately, then implement an efficient text and follow up system 254 Get the TB to fill out an Application or Showing Request If you are limited with time, get the TB to fill out info on your site If you don t have a website, a manual application But filter the ones worth calling back!

86 Showing the House Review application on phone with TB Verify they understand the RTO process and down payment Coordinate for them to see the house 256 Five Ways To Show A Home Have the seller show it Hire a Realtor or assistant Lockbox Only after they submit an application or SR They MUST call when they are leaving the house!!!! 257 Five Ways To Show A Home Schedule open houses Meet the TB at the house, ONLY after: They have driven by or seen pics & video Application received and talked with us Double confirmed appointment

87 Get Their Feedback If the buyer does not like the house, ask questions! What did you like & not like? What exactly do you want? Enter comments into database and continue to follow up with them 259 Important Note Many of our placements are from buyers that we follow up with over time! 260 Review and Approve Applicants Main Criteria we use for TBs Credit report Appears lendable by option expiration date No recent serious credit issues BK, Foreclosure, Short Sale

88 Review and Approve Applicants Down payment + 1 st month s rent The greater of 3.5% or $5K Income supports the rent/future loan 3-4 times rent 262 Review and Approve Applicants Job history Rental verification No evictions Rent on time for at least last 12 months Good references from current/past landlords Criminal background 263 Review and Approve Applicants Unless they have a recent lender s credit report, pull one yourself Have mortgage broker/lender pull one Forward to Clean Slate for review

89 Review and Approve Applicants Encourage them to get into credit repair Make part of approval requirement Can count as part of down payment!!! Forward complete file to seller to discuss and get their approval 265 Finalizing Paperwork Assign contracts to TB Meet with the seller & TB: Introduce parties Answer questions Review your ongoing role Eventually, can all be done remotely with digital signatures (e.g., HelloSign) 266 Finalizing Paperwork Release funds from escrow & provide escrow release documents Option consideration to you 1st month s rent to seller

90 Real Deal #3 268 Real Deal #3 Details House ARV = $420,000 Listed with Realtor on MLS for 6.5 months with very few showings and one contract that fell through at the closing table Lead source = Craigslist for rent Software picked up lead within minutes of it being posted 269 Real Deal #3 Seller owed about $250K and was current on pmts Seller wanted to net $400,000 & $2,695/mo Option target range advertised (3%-5%) = $12,600-$20,995 Rent Credits = $0 Option Price = $419,

91 Real Deal #3 Seller still lived in the house and just wanted to move to another State Very nice 2006 custom built home, 2,600 sq ft not including fully finished basement In exclusive golf community with elaborate residence center 271 Real Deal #3 Home had $30k home theater system, wet bar, central vacuum system, and high end upgrades throughout Medium to Higher-end price range for area in the County Encouraged seller to keep listed with a Realtor to give him all options, but he refused he loved our strategy and was not distressed 272 Real Deal #3 Marketing No sign in yard and no direction signs Took lots of pics and video Posted on vflyer, YouTube, Google+, Facebook, LinkedIn, Twitter, and WordPress website TB found our YouTube video on a Google search We met TBs at house with seller to show Took a total of 3 weeks to find TB!

92 Real Deal #3 Tenant-buyers Make over $200,000/year BK discharged 6 yrs ago and Foreclosure 5 years ago Husband professional engineer for Fortune 10 company and wife is a disabled paramedic supervisor Long job history in same field Credit scores almost Real Deal #3 Receiving a lump sum payout of $250,000 in less than one year, and plan to buy home in less than 12 months They just loved the home and were not ready to deal with looking for a mortgage at this time, so RTO fit them perfectly 275 Real Deal #3 Tenant Buyers Signed 2 year lease option agreement We met with the seller and TBs for them to sign the Rental Agreement and Option to Buy Agreement TBs put $15,295 into escrow $5,390 to seller for 1 st months rent and part of option fee $469 to cover home warranty $9,436 to us for our fee

93 Real Deal #3 TBs had a total of $12,600 counted towards down payment/option consideration TBs signed escrow release documents TBs also purchased majority of seller s furniture TBs have ed our YouTube video to all of their friends and family inviting them to come visit 277 Real Deal #4 278 Real Deal #4 Details House ARV = $270,000 Listed with Realtor on MLS for 6 months with no offers and no showings Lead source = Realtor referral (from Facebook) Seller had no mortgage Seller wanted to net $250,000 & $1,795/mo Option target range advertised (3.5%-6%) = $9,450- $16,195 Rent Credits = $0 Option Price = $269,

94 Real Deal #4 Details Very nice home in country on 3 acres of land, but location was very far out for most people, and the surrounding homes for sale were new-builds House was built in 1957, and inside was amazing, but dated Tough competition for Realtor listing Informed seller location could pose a challenge, but it s a beautiful home Median priced home for County Encouraged seller to keep listed with a Realtor to give him all options, but he refused he loved our strategy and was not distressed 280 Real Deal #4 Marketing No sign in yard and no direction signs Property was vacant Gave lockbox code to TBs to view home Took lots of pics and video Posted on vflyer, YouTube, Google+, Facebook, LinkedIn, Twitter, and WordPress website Started getting applications and showing the property in about 2 days TB found us on Trulia.com via vflyer posting Took a total of 5 months to find the right qualified TB! 281 Real Deal #4 Tenant-buyers Make over $80,000/year Short sale on record Husband is truck driver and wife is medical tech Long job history in same field Credit needed some clean up Enrolled in our credit repair referral program

95 Real Deal #4 Tenant Buyers Signed 2 year lease option agreement We met with the seller and TBs for them to sign the Rental Agreement and Option to Buy Agreement 283 Real Deal #4 Tenant Buyers TB put $12,995 into escrow $1,795 to seller for 1 st months rent $2,000 to Realtor referral (20% of our net) $369 to cover home warranty (our cost) $1,200 for credit repair (2 people) $240 referral fee to us $7,631 to us 284 Real Deal #4 Tenant Buyers TBs had a total of $11,200 counted towards down payment/option consideration TBs signed escrow release documents Everything is out in open Everyone wins!

96 Reality Check We are reading more and more in the news where Americans are expected NOT to take their vacations and work longer hours and are constantly in fear of being laid off = STRESS!! 286 Exert from USA Today More Americans will stay at their desks this year the nation s nose-to-the grindstone culture has resulted in many Americans leaving vacation days on the table we are a hard-working lot ambitious not taking all the vacation time that s available has become an American trait 287 What Has Link Options Done For Us? Fulfill our Life Vision Enabled us to build a business around our life Our business serves us! Eliminate Stress and Risk From our Life Take lots of time off Allowed us the free time to create other related businesses, such as coaching

97 What Has Link Options Done For Us? No JOB! Freedom! 289 What Has Link Options Done For Us? Wipe out Debt and Start Saving/Investing Money Discontinue Leveraging any Money Create Win-Win Situations for Everyone 290 Link Options Clients vs. Traditional Clients

98 There is no easier way in real estate to make QUICK cash and with little to no competition! $3,000 - $6,000 in days??? Yes, Yes, Yes!! This business is too EASY!! 292 How Can You Get Started? 293 Getting Started We have a Link Options Online Training Program Unlike Any Other Product on the Market Many Other Gurus Have Said It s Simply Revolutionary How We Present Our Training and Are Going To Do Theirs The Same Students Are Telling Us It s The Most Logically Thought Out, Complete and Easy To Follow Training They Have Ever Seen

99 New Student Comment in Member s Forum Hello Team, I am new to the forum but I have to say this is by far the best organized information product I have ever purchased. I have probably invested close to $30K in information products not including coaching, and again, by far this is the best I have seen. Milton L Original Message Subject: RE: New Link Options Member - Matt Marqua, xxxx From: Matt Marqua <matqua@msn.com> Date: Sun, March 03, :51 am To: Keith and Shannon French <info@keithandshannonfrench.com> Hi Guys, Bravo!! Your training website is top notch - well laid out, thorough, and intelligent. (Unlike many training materials I've seen!) So, thank you! Matt M. (alias 'Bill Clinton') Original Message Subject: Contracts and forms/ Marco Gravina From: "Marco Gravina" <mgravina@investprop-md.com> Date: Sun, February 10, :36 pm To: "Keith and Shannon French" <info@keithandshannonfrench.com> Keith and Shannon: I want to congratulate you for the excellent training course. Al and I have gone through several courses including s, and yours is a lot easier to follow and is more "hands on". Thanks for all your help. Marco

100 New Excited Student Phone Call Wow, I ve have not even mailed out 200 of your Yellow Letters yet, and I already have 7 sellers interested in Link Options!! This was within 5 days of buying the course! 298 What Link Options Purchasers Have to Say Well, the phone has been blowing up since I started hammering the direct mail/craigslist leads. I started the CL leads last night, got a call last night, went to see it today and will be signing it up with the owner Saturday (heading out of town to hike for 2 days)...so, to recap this week's (and last's) activity, sent out about 120 letters, did direct marketing to craigslist to the tune of about 10 last night...i had about 17 calls I have 9 properties I'm working proposals up for, and 3 other people I'm playing phone tag with...not a bad week... Mike H Original Message Subject: RE: Keith and Shannon French shared "Link Options Master Documents From: Marjorie Binder <mkbinder1@hotmail.com> Date: Thu, October 24, :15 am To: "info@keithandshannonfrench.com" <info@keithandshannonfrench.com> Dear Keith and Shannon, All I can say is Wow! I am just awed by how much information you guys provide for such an incredibly incredibly reasonable price...thank you!! Marge

101 Original Message Subject: Adam Olsen Testimonial From: "Keith and Shannon French" Date: Fri, April 26, :16 pm To: "BuyBaltimoreProperties.com" Hi Keith and Shannon. Well, it's official, I finally cashed out of my first deal and can't believe how smoothly it went! (knock on wood for the next deal!) I wanted to tell you first and THANK YOU BOTH VERY MUCH for all your help to get me to this point. I can't tell you how much I appreciate it. This money that I made is so huge for my family and me right now. Adam Original Message Subject: Re: Tonight's Link Options Call Reminder - 7pm CST/8pm EST From: "adamolsen28@gmail.com" <adamolsen28@gmail.com> Date: Thu, August 08, :21 pm To: Keith and Shannon French <info@keithandshannonfrench.com> Hey Keith, Sorry, but I won't be able to make the call tonight. I'm on vacation w/ the fam. Will catch up with you all next go-around... Hoping to close deal #2 next week and deal #3 is in the works! WooHoo! Have a great rest of your week! Thanks, Adam Original Message Subject: SMS from Ryan Gauthier [(410) 903-xxxx] From: "Ryan Gauthier (SMS)" < HBlnN-Zj8@txt.voice.google.com> Date: Mon, April 22, :30 pm To: info@keithandshannonfrench.com Hey by the way I owe you guys a HUGE thank you! I closed the first LO deal while we were out of town!!! Thank you! Ryan

102 Theory In Developing Course We decided to develop a one-of-a-kind online training that would emulate hanging out with us for at least two weeks We wanted to provide you with everything you will need to implement this strategy We decided to cover an unprecedented amount of material in our real estate training course, setup very much like a college curriculum 304 What is Unique about our Course?...It s Like: Having a personal coach with you at all times; Receiving as much or more content than you would get at a 4-5 day boot camp; Getting a home study course, but much easier to follow and understand; Having access to instant updates, down loadable contracts, and a FREE active member s forum to ask unlimited questions 305 Step by Step Tutorials in Order of Implementation Link Options Training

103 Multiple drop down boxes packed with videos, screen flow examples, downloadable and editable contracts, recorded live phone calls with sellers and buyers, role playing, scripts, recorded live closings, case studies, etc. Link Options Training 307 Live role playing handling all seller and buyer objections Link Options Training Downloadable scripts 308 FREE member s forum to ask unlimited questions under the Updates/Extras tab! Link Options Training

104 Recap of What s Included Recorded live seller & buyer calls, plus downloadable scripts & live role plays Recorded live closings, staging properties, making and putting out bandit signs, etc. Downloadable & editable contracts & forms for everything you need Live demonstrations of pulling comps, doing tenant screening, going through each line of our contracts How to setup an escrow account 310 Recap of What s Included All of our marketing strategies, including Yellow Letter, Craigslist, voice & text blasting, social media & internet marketing Setting up websites and squeeze pages with non-branded videos for you to insert into your own marketing Very detailed case studies Wendy s entire Cooperative Options course, including downloadable contracts The list goes on and on!!! 311 What is Included in our Course? Content, Content, Content!!! It s Literally Like Spending at Least Two Weeks with Us Doing Every Single Aspect of This Real Estate Strategy What Would Spending Two Weeks With Us Be Worth To You? $7,995 Value

105 What is Included in our Course? Unprecedented Content!!!! Like Having us as Your Personal Coach for at Least Two Weeks FREE On-going Support Through Our Exclusive Member s Forum All of our Contracts, Case Studies, Marketing Material, Internet Marketing Strategies, etc.like a 4-5 day bootcamp + home study course 3-Day Bootcamp with Wendy Patton & Keith and Shannon French + Wendy s Entire Cooperative Options Course Value $7,995 $197/month++ ($2,364 annually) $2,997 $1,997 Total Value of LinkOptions Training - $15,353!!! 313 But Wait That s Not All!!! Wendy is giving you another Incredible Bonus worth $994! 314 Only For Those Who Purchase at This Event!!

106 Wendy s Special Bootcamp Bonus!!! If you find deals where you want to stay involved in the transaction because it has equity and/or you want to build a portfolio of rental homes, then Wendy is giving a HUGE BONUS!!! 316 Wendy s Special Bonus!!! 317 and another $500 Bonus!! Lease Option and Link Option Coaching with Jim Aydelotte