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Chris Yates

Raising Private Money Online Series Class 2: Finding and Prescreening Your Private Lenders Konrad Sopielnikow of FortuneBuilders Inc & Chris Yates of CM Yates Inc. Chris Yates. Konrad Sopielnikow. Webinar Agenda. Finding Private Money Investors Private Money marketing materials

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Chris Yates

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  1. Raising Private Money Online SeriesClass 2:Finding and Prescreening Your Private LendersKonrad Sopielnikow of FortuneBuilders Inc& Chris Yates of CM Yates Inc

  2. Chris Yates Konrad Sopielnikow

  3. Webinar Agenda • Finding Private Money Investors • Private Money marketing materials • Prescreening your prospects • Setting up a meeting • Case Studies – Continuation from Webinar 1 • Q and A

  4. Changing Your Mindset Asking for money vs. Offering an opportunity

  5. Changing Your Mindset Stock Market RE Private Lending Completely Unsecured Completely Uninsured Invest at Market Price Returns Are Unknown Secured by a Deed of Trust or Mortgage Deed Collateral is Fully Insured Collateralized Below Market Value Returns Are Fixed and Agreed Upon Tangible Asset

  6. Changing Your Mindset Stock Market RE Private Lending Value of stock drops Risk of Total Loss Zero Collateral Investor Assumes Control of Asset Investor Assumes Equity Position Investor Receives Income From Asset

  7. Where to Find Private Investors? • Referrals - Get OTHERS to raise money for you! • REIA and Investor Clubs • Your Real Estate Attorneys • Business and Banking Networking Events • Your current career and professional circles • Attorneys, Doctors, Accountants, Financial Professionals, Bankers, Other Entrepreneurs • Family & Friends* • Online Networks – ex. Facebook, Investor Forums THEY ARE ALL AROUND YOU!!!

  8. Private Money Networking Strategy

  9. Best Source of Private Money • Self Directed IRA’s • Self Directed 401k • National Custodians • Equity Trust Company • www.trustetc.com • Entrust Northeast • www.theentrustgroup.com

  10. Setting Up a Self Directed Account • Simple Process - Explain and help your investors set up an account • Fill out Equity Trust Transfer Form • Invest in Promissory Note with you • Create, File and Mail security documents

  11. Marketing Materials • YOU & Enthusiasm for Business! • Your Phone • Introduction/Reconnect Email • Investor Credibility Packet • PowerPoint Presentation • Welcome, Thank You & Statement Letters • Power of Picture & Video (YouTube.com) – documenting your projects/investments

  12. From: Konrad SopielnikowSent: Monday, December 27, 2006 10:00 AMSubject: keeping in touch…Attachments: Investor Packet (12%).doc; Company Resume Hey Joe, How is life in NYC treating you? We haven’t talked in a while. I am emailing you for two reasons.  One, to catch up and see if you were planning to come to the football game and two because we are looking for new investors to help us finance our foreclosure flip projects.   As you probably know, I’ve been working with Than and another friend, Paul up in New Haven and we’ve been growing our real estate investment company.  Since we are always increasing the number of projects that we are working on, we are looking for new investors. We already have Joe Smith, few members of our family and friends invested with us for a total of 2.5 million, which is a nice chunk of change.  I figured you may know some other people who would be interested in making a sure 12% annual return on their money.  The market sucks right now so this is a great alternative. We also pay 1% referral fees to anybody that brings us an investor.  Meaning, if you brought someone who’s willing to put up 100k, you’d get $1000.  The money is invested for anywhere from 6 to 12 months.  Finding investors is a great way to make some extra cash and it’s an easy sell for us considering the security of the investment and guaranteed high interest rate.   We also borrow from investors’ IRA’s, which is a really good deal, considering the interest is all tax free or deferred.   Anyway, I am including a packet.  Take a look at it and let me know if anyone comes to mind. If you find someone who is interested, pass on my information or better yet give me a call and I’ll explain the program in detail. Thanks. Kind Regards, Konrad

  13. Credibility Packet • Company Resume / Description of Business • Case Studies Outline • Pictures (ex. Rehabbing Course “Trash to Cash” ) • Investor Program Overview • Answers to FAQ • Business Cards (*Referral Reward Program)

  14. Credibility Packet

  15. Before and After Case Study

  16. PowerPoint Presentation • Keeps your presentation organized so you can hit all important points • Makes you look professional • Allows for visual effect of pictures • Allows you to practice and refine your pitch

  17. PowerPoint Presentation • About Your Business • Who, What, and How? • Private Money Program • How Much, When, and How? • Closing Process and Documents • Investor Options • Buy a Property • Invest Money • Refer Investor

  18. Prequalifying Your Investors • Initial Phone or in Person Conversation • Email Credibility Packet with FAQ • Set Up a Phone Appointment • Explain Basics of the Investor Program • Set Up an In Person Appointment

  19. Keys to Successful Prequalification • Set agenda for your call/conversation • Business – Who and What? • Money Program – intro and terms • Set a meeting or get commitment • Know your Private Money program & terms • Don’t be afraid to ask about $ • Don’t be afraid to say “no”

  20. Where to Meet Your Investor? • Your Office • Your Attorney’s Office • Your Home Office • Lunch or Coffee Shop • At a Project/Property*** - ONLY AFTER PRE-SCREEN

  21. Case Study Time

  22. Case Study 1 - Rehab • 124 Smith Street, New Haven, CT • Purchase Price $100k • As is value of $150k; ARV of $200k • Rehab $30k • Investor lending $130k at 12% • 6 month note • Paid off in 120 days (4 months) • $130,000 x .12 x 4/12 = $ 5,200 in interest

  23. Case Study 2 - Wholesale • 124 Smith Street, New Haven, CT • Purchase Price $100k • Wholesale value of $150k • Investor lending $100k at 12% • 7 day flip • $100,000 x .12 x 7/365 = $230.14 • ***guaranteed 1 point min. = $1,000

  24. Case Study 3 CM Yates Purchase Price = $71,000 Estimated Renovation Budget = $18,000 Closing Costs = $500 Pro-Rated Taxes and Insurance = $1,000 Total Cost Basis = $90,500

  25. Initial Deal Structure • Investor Funds: $100,000 • Lender Fees: $1,500 • CM Yates Cost Basis: $90,500 Remaining Funds = $8,000

  26. Joe’s Earnings After One Year • $100,000 Principal Invested + 1.5 Points = $1,500 + Interest @ 12% = $12,000 = $13,500 Earned in 1 Year 13.5% APY • Secured by Deed of Trust • Insured by Hazard Policy

  27. Awesome Webinar Bonus! www.fortunebuilders.com/investor-packet/

  28. Q & A

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