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INVESTMENT NEWS
Mid-America Association of Real Estate Investors Newsletter

Real Estate Investor Meeting

On January 13th, 2015, at MAREIs Monthly Meeting, 32 year industry veteran, Eddie Speed will present The State of the Industry 2015. See the supporting
data of the Shift in the Industry that points to the Need for Every Real Estate Investor to learn the Note Industry in the next five years.

Industry Shifts
The fact that the smart money, such as Wall Street Hedge Funds, has already
noted the changes and taken appropriate actions for huge profits in the future. In
order to profit big just like the smart money, investors must first familiarize themselves with the shift that has taken place in the market.
New changes in government regulations have posed new challenges that must be
counteracted such as rising prices, lack of inventory, falling profit margins, increased competition and increased issues with landlords. Investing in the note
industry comes with a range of benefits spanning high national inventory, discount
buys of up to 70%, less competition, huge investment returns, no issues with landlords, exemptions by Dood-Frank, payments from government funds, streams of
passive income to payouts in lump sums.
Tuesdays Meeting is FREE for members and has a cost of $25 at the door or
$15 if you preregister on the calendar of events at MAREI.org.

January 2015

MEETING

LOCATION
Holiday Inn & Suites
Overland Park West
8787 Reeder Road
Overland Park, KS
Top Floor
Sunset Ballroom

Member
Benefits

What is a Note

Monthly Meetings

~ Eddie Speed

Monthly Seminars

Local & National

Events

Most real estate investors have heard of the Note Business but many misunderstand it while others think that it is completely separate from the real estate business. The fact is, most real estate investors are in the note business, and they just
dont know it. The note business is the financing side of the real estate business.

FREE Website*

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Member Property
Marketing

Local & National

Vendors

Local & National Discounts

Social Media Pages

for Members to
Connect & Market

National Legislative
Watch Keeps You
Informed and
Protects Our Industry

Note Business in the Simplest Terms

The note business is based upon the purchase, sale and assigning of two documents: the promissory note and the mortgage agreement. These two documents
represent a promise to pay and a solution for non-payment.
Note = Promissory Note = IOU (I Owe You)
Mortgage = Collateral Agreement = Foreclosure Agreement

When someone borrows money to purchase real estate, they have to sign an
agreement to promise to pay it back. This agreement also outlines the terms of the
payback. This written promise is not enough to get a loan. This promise must be
backed by collateral of value, which is typically the real estate itself. The collateral
agreement pre-authorizes the foreclosure of the property if the debt is not paid
according to the promissory note.
Move from the Paying End to the Receiving End of the Business
So if you have ever borrowed money from a traditional lender, private or hardmoney lender, or even a property seller, you have been in the note business!
Well, you have been on the paying side of the note business. Why not get on the
receiving end of the note business!
In the receiving end of the note business, you can receive monthly cash flow without the headaches and liabilities of being a landlord, lump sum cash payouts, or
even end up with the property at 30 to 40 cents on the dollar!
Acquire Property or Cash Flow for Pennies on the Dollar

Membership

Todays inventory of both performing and non-performing notes is so massive that

it doubles the number of foreclosures since 2008. This supply has prices for notes
at historical lows but it will not last forever.

Annual $99

Internet Only $50

Business $499

When you buy a non-performing note on a vacant home, you will acquire a Deed
in Lieu or foreclose and end up with the property. You are a real estate investor
simply acquiring property in a different way.

Monthly & Quarterly

Payment Plans

If you buy a non-performing note on an occupied property, you will either modify
the loan to start receiving monthly cash flow, get a Deed in Lieu or foreclose.

MAREI.org

Non-Performing

Performing
When you purchase a performing note, you acquire long term, real estate backed,
monthly cash flow. Today, these assets can be purchased for 60 cents on the
dollar. That is an unbelievably good deal. No land lording, no hassles, just automatic monthly deposits into your account.

BUSINESS
directory
Service

Company

Contact

Phone

Web

Auction Company

Cates Auction

Staff

816-781-1134

CatesAuction.com

Contractor

Building Trades

Robert Massey

816-868-1817

Contractor

Discover Heating & Air

Curt Whitlock

816-500-2970

Discover HVAC.net

Contractor Supply

Choice Cabinets

Karl Dunivent

816-343-8887

ChoiceCabinet.com

Contractor Supply

Home Depot

George Neal

816-510-9199

HomeDepot.com

Contractor Supply

Odor Universe

Mike Riddle

816-718-9136

OdorUniverse.com

Contractor Supply

Sherwin Williams

Mike Steiner

816-589-8506

SherwinWilliams.com

Hard Money

Great Plains Funding

George Hersch

913-735-6605

GreatPlainsFunding.com

Hard Money

Investor Choice Funding

Dave Williams

303-500-7088

InvestorsChoiceFunding.com

Hard Money

Kansas City Investor Funding

JJ Pawlowski

816-916-4593

KCInvestorFunding.com

Hard Money

Longhorn Investments

Mike Friedl

913-634-6386

LonghornInvestments.com

Home Buyer

kcmoHomeBuyer

Don Tucker

816-200-2198

kcmoHomeBuyer.com

Insurance

Asset Protection Insurance

Lisa Goodner

877-752-2742

APIAProtects.com

Investor

3B Real Estate Investments

Bob Hult

913-940-0992

3BREI.com

Mortgage

Pulaski Bank

Beth Langston

816-234-8660

PulaskiBank.com

Realty

Realty Resource

Staff

816-523-4400

RealtyResourceKC.com

Realty & Management

Arrow Realty

Candace Davis

913-956-5003

ArrowRealtyKC.com

Realty & Management

Home Rental Services

Kandy Meehan

913-469-6633

Home4Rent.com

Realty & Management

Jamieson Home Team

Kevin Jamieson

913-384-8331

JaimesonHomeTeam.com

Security

COPR Cage

Geoff Miles

816-398-4045

COPRcage.com

Title & Escrow

Accurate Title

Jackie & Tina

913-338-0100

AccurateTitleCo.com

Title & Escrow

Alpha Title

Patsy Archer

913-498-8999

AlphaTitleLLC.net

See full details on all Business Associates at MAREI.org/Business-Directory/

Mid-America Association of Real Estate Investors does not render legal, tax, economic or investment advice. All programs, properties and services are provided with the understanding that Association is not engaged in rendering legal, tax,
or other professional services. If legal, tax or other expert assistance is required, the services of a competent professional
should be sought. Everyone should complete their own due diligence!

Where do we find houses?

~ Joseph Varnadore/NoteSchool
What should the investor do?
Today more and more people are attracted to real estate and naturally by extension, real estate investment associations and
clubs. Many of these investors are new or newbie investors who are easily overwhelmed with information and constantly
search for the best way to start. They suffer from paralysis of analysis.
The instructors at NoteSchool each have dozens of years of experience in the real estate investment space. This includes
buying real property and mortgage-backed notes. In this article we will use that insight to cut through the noise so that you
can get started making money in real estate investments by breaking this industry down to the very simple basics.
Two Ways to Acquire Real Estate
As an investor, you can acquire real property by purchasing the property outright or by purchasing the mortgage-backed
security and then acquiring the property. Several things will determine which of these two approaches you use. So lets take
a birds eye view of these approaches.
Acquire Real Property by Purchasing the Property Outright
In this approach you are directly acquiring the Deed to the property. The goal here obviously is to acquire the property at a
discount, in fact the greater the discount the higher the profit. This requires a motivated seller. This type of acquisition is either through a voluntary sale or a legally enforced sale.
Voluntary: A voluntary sale would be simply purchasing the property from a motivated owner/seller. These owner/sellers
include:
Individual motivated property owners

MLS listed sales

Disenchanted landlords

Owners of inherited property

Property in probate

Bank and other lender owned property (REO property)

Bank or other lender approved sales (short sales)

The supply of these types of properties has drastically dwindled in the past year. In fact, RealtyTrac reports that Short Sales
have dropped in half in just the past 8 months. In that same time period, REO sales have dropped 25%. It should be noted
that the price of these types of acquisitions has gone way up to the point where even seasoned individual investors simply
cant afford to buy and make a decent profit.
Involuntary: In todays economy, most investors acquire the property through a legally enforced sale. This means that the
property owner was negligent on some legally required payment and the party who is suffering the delinquency has filed a

legal action for restitution. Thats a fancy way of saying its time to pay the piper.
These owner/sellers include those with homes sold at Auction Foreclosure Sale
for Non-Payment of
IRS Taxes
Super Lien

Property Taxes (Tax Deed Sales)

st

1 Mortgage

HOA fees
Junior Liens

These types of acquisitions are competitive not only with local investors but large
institutional investors such as Blackstone and other hedge funds, private equity
firms and real estate investment trusts.
Acquire Real Property by Purchasing the Mortgage-Backed Security
In this approach you are acquiring the Deed to the property by purchasing the
underlying mortgage debt. The goal here, as always, is to acquire the property at
a discount. As stated previously; the greater the discount the higher the profit. This
type of acquisition is also through a voluntary sale or a legally enforced sale.
Voluntary A voluntary sale for this acquisition type would be a relief for the property owner. These owners, looking to get out from under the enormous debt load
would Sign Deed in Lieu of Foreclosure or a Loan Modification.
A Deed in Lieu allows the debtor to simply walk away from the problem. In fact,
right now, the Debt Forgiveness Act allows them to walk away with out any federal
tax ramifications. A loan modification allows the qualified homeowner to start making payments once again but on an adjusted loan schedule that they can afford
and the debtor agrees to.
Involuntary An involuntary sale for this acquisition type would be done by simply
enforcing the legal documents that the property owner has already agreed to. This
acquisition means the investor simply Enforces the Mortgage or Deed of Trust.
Owners who simply got tired of waiting for the bank to enforce the mortgage have
already vacated many of these properties. The neighbors, city and local county
government are happy to see these properties acquired and turned into owner
occupied homes once again.

From
Noteschool
Students
This had been a
very good year for
us... if I can do it,
you can do it...
~ Paula from
Kansas City

NoteSchool has
given me the power to achieve my
dreams...
~ Imran from
Phoenix

Discount Your Way to Higher Profits

Statistics show that:

REO and Short Sale acquisitions are being purchased at about 30% discount

Non-performing mortgage-backed notes are being acquired at about 70%

discount

This is where the market is today. In fact, Bloomberg just interviewed 8 of the top
financial managers in the world. These top investors run companies that have
unlimited funds and virtually every investment asset in the entire worldwide spectrum and yet US non-performing mortgage backed notes was a highly recommended favorite for 2014.
In addition, because the cost of entry level is significantly lower for acquiring mortgage backed notes, investors are finding that they dont have to go into debt with a
high interest acquisition loan such as a hard money loan. In fact, over the past few
years we trained investors who were able to acquire properties for less than
$5000 (five thousand dollars-not a typo!).

"We're receiving a
check for $30,000
on an $11,000 investment..."

~ Jason from
Phoenix

Photo by Stuart Miles with FreeDigitalPhotos.net

Why Would a Seasoned Real Estate Investor

Need to Be in the Mortgage Backed

Note Business?
~ Joseph Varnadore/NoteSchool
As a seasoned real estate investor you understand that you make your money when you buy and that is why you need to
buy at a discount. The most common discount buying strategies are:

Short Sale

Foreclosure Sale

REO Property

Tax Deed Sale

Probate Sale

You, of course, realize the profit from your discount buy when you apply your pre-planned exit strategy. The most common
exit strategies are

Wholesale

Retail (fix and resell)

Fix and Rent

Lease Option

New government regulations have forever changed todays real estate market. The repeal of the Glass-Steagall Act, and the
implementation of the Dodd-Frank and SAFE Acts have forced lenders, buyers and investors to adjust.
To simply continue to pursue the above discount buying strategies and exit strategies will severely limit your in-

vestment opportunity and profit margins.

These adjustments have created both problems and opportunities. The problems
the seasoned investor faces are:

Lack of Inventory

Rising Prices

Increased Competition

Falling Profit Margins

Increased Landlord Issues

The opportunities that have been created are primarily in the finance side of the
real estate business. The finance side of the business is the note industry. This is
an opportunity that the seasoned investor can easily add to their current skill set
because the investment philosophy is the same: buy at a discount with a preplanned exit strategy.
The opportunity of adding this part of the real estate industry to your existing business is:

Record high national inventory

Up to 70% discount buys

Way less competition

Huge returns on investment

No landlord issues

Dodd-Frank exemptions

Government funds can pay you

Passive income streams

Lump sum payouts

Take a look at this case study that will yield our very seasoned REO specialist
student 322% in one year, on one deal!
Our student purchased an $85,725 non-preforming note for $10,862. Now thats a
discount. In addition he had to pay off some other liens, which totaled about
$1500.
Since the owner was still living in the property and wanted to stay, our student
modified the $85,725, 8.84% loan to a $52,000, 7.75% loan. This reduced the
property owners payment from $617 per month to $358 per month.
As a part of this debt reduction and loan modification, they applied to the hardest
hit funds. In exchange for forgiving debt and modifying loans, these special funds
pay up to a certain amount back to the lender. In this case, our student is receiving a check for $30,000 from the state!
The raw numbers:

Paid out $12, 362

Received $30,000 plus a $2000 reinstatement fee

Will also receive $358 per month for 30 years

By the way, this investor purchased 30 deals in his first year with Note
School..

Connect
Live Meetings
Monthly
Live Training
Monthly
Member Forums
Online
Social Media
Groups Promoting
Kansas City
Real Estate
Grow Your Kansas City Connections by joining

Mid-America
Association of
Real Estate
Investors

Recently Released Economic News

Will Affect You and Your BUSINESS
All the changes in the national economy and real estate market indicate one clear thing; investors are confused. They need
guidance and a strong network around them. That is why we compiled data and statistics to present at the NaREIA Mid-Year
event in Denver in June.
Since that event, even more data continues to prove our point:

Nobel Laureate on Economics, Robert Shiller, says that stocks have been more expensive only three times in the last
century: 1920s, late 1990s and the prelude to the 2007 crisis,

2013 was the worst year in history for the Bond Market,

Mutual Fund giant, Vanguard, says that IRAs are being used as money market parking lots.

This shows that investors are weary of the stock market, afraid of the bond market and are sitting in cash-like positions. Expect these investors to turn their focus toward value buys: real estate and real estate notes.
May no mistake; these new investors will change the market! How well you position yourself for these changes will determine how well you do (or dont do). Think about how the hedge funds changed the REO and rental market over the past 2
years.
Here are some projections:

Large cash buyers (hedge funds) will exit single-family real estate and focus on selling rent-backed securities and purchasing large pools of non-performing loans

New value-seeking cash investors will be looking for turn-key investments

Millennials are not ready to move out of Mom and Dads house just yet and when they do, they will rent not buy

Re-performing notes will continue to be priced historically low as hedge funds and private equity firms buy nonperforming notes and re-sell them after modifying the loans.

REO inventory will have spurts of growth but ultimately continue to shrink as banks liquidate their non-performing assets
through note sales to quickly meet new government regulations

Non-performing note inventory levels will remain mostly unchanged as shadow inventory is leaked into the market countering the sale of these notes

Short sales will continue to fade unless Congress retroactively reinstates the Mortgage Debt Forgiveness Act

Notes on <$500,000 commercial and multi-family properties will be sold by large investment firms to small investors

Note Investors:
Helping People Stay
in Their Homes
Ms. Solomon was desperately trying to help her father. She became the financial
and medical advocate for him since her mothers passing in 2011. Her father was
in poor health and simply unable to afford the mortgage on the property that he
and his wife had shared. Letters to the bank went unanswered and the future was
uncertain.
The property value had dropped on their Florida home to $60,000; far less than
the $110,000 that was owed. Ms. Solomon was desperate to work with the bank
but wasnt able to find anyone who could help her. Her goal was very clear: she
wanted to make a short payoff so that she could move into the house and provide
for her ailing father.
The note and mortgage was sold by the bank and eventually purchased for
$35,000 by NoteSchool students, TJ and Rick. These business partners studied
the file and recognized that the father and daughter were emotionally attached to
the property. They simply wanted someone to listen to them and to work out a
solution. TJ and Rick did just that.
TJ and Rick were able to quickly present 2 options for Ms. Solomon:

Option 1: A short payoff of $55,000.

Option 2: $35,000 payoff with a new $35,000 loan.

If she chose Option 1, TJ and Rick were willing to forgive 50% of the loan. In addition, they would forgive all past due payments and waive their deficiency clause.
If she chose Option 2, they would reduce the balance of the loan to $35,000. They
would also reduce the interest rate to 5%, shorten the payoff to 72 and lower their
payment to $564 per month.
Ms. Solomon chose Option 1. This lingering problem was solved very quickly once
TJ and Rick owned the note. Ms. Solomon was able to keep her father in his comfortable and familiar surroundings without the fear of losing the home.
The solution to this real estate crisis is the entrepreneur. Unlike big lenders, entrepreneurs such as note buyers have the ability to make quick and nimble decisions.
These quick decisions can make the difference between somebody remaining in
their home or having to move out.

From
NoteSchool
Students
Working with Eddie & NoteSchool
has changed our
business . .
~ Kim from
Kansas City

"I am here to learn

what is coming up
and what we
should expect in
the next 2-5
years..."
~ Tim from
Raleigh

"We are learning,

not only to line our
pocket books, but
to make an impact.. that makes
it all worth wile.."
~ TJ & Rick from
Orlando

State of the Industry 2015

Why the Note Business is HOT!

Attend the January Meeting of Mid-America Association of Real Estate Investors to

Learn the State of the Real Estate Investing Industry for 2015 and Why the
Note Business is the Hottest Topic in Real Estate Investing Right NOW!!
Then Attend an All Day Workshop on Saturday January 24th to Learn Why Every
Real Estate Investor Simply MUST Learn the Note Business in the next Five
Years or Get Lost in the changing Industry.
Thirty Year Note Business Veteran Eddie Speed has dedicated his professional life
to the seller financing and non-performing note industry. Over the years, he has introduced innovative ideas and strategies that have positively impacted the way the real
estate industry operates today. His group of businesses includes Colonial Capital
Funding Group, that is active in buying and selling notes and NoteSchool that trains
students how to buy, sell, workout and hold both performing and non-performing notes.
He also manages a family of Private Equity Funds that acquire bulk portfolios of notes.
His active participation for the past 30 years in the Note Industry and most recently in
his own businesses, makes Eddie uniquely qualified to give us an overview of the
Current Real Estate Investing Market.
Eddie will bring his facts and figures to help you understand:
Why the Note Business is the Hottest Topic in Real Estate Today

and why the Government is pushing it!

How To Find Real Estate Bargains Via Notes
How To Find The Hidden Inventory of Real Estate That No One Else Knows
How To Buy Non-Performing Real Estate for Pennies on the Dollar
How to Turn $100 in Your Roth IRA into $100,000 or More and Retire Tax Free
How to earn velocity income without using any of your own money
Why Real Estate Agents, investors, builders, property buyers and sellers are creating a strong de-

mand for these services and how you can cash in by becoming the go to person
Why flipping notes is easier and less time consuming than flipping properties
How to paper out of properties and triple your net income
How anxious money is changing the industry making your opportunities greater than ever before
How to become a Note Buyer with as little as $100 dollars
How to apply your current real estate knowledge and skills to make even greater profits with the

note business
Join us and 80 to 100 fellow investors as we connect and Get the Low Down on the Current Real Estate
Industry with Note Expert Eddie Speed. This is all happening at the MAREI Meeting on Tuesday
January 13th at 6PM at the Holiday Inn & Suites Overland Park West located at 8787 Reeder Road,
Overland Park, KS and get a jump start on your 2015 business.
This monthly meeting is open to all members of MAREI at no charge and the general public for a fee.
At the door fee is $25 per person, or pre-register on our calendar of events for $15. Visit MAREI.org to get more information and to pre-register or call the MAREI office at 913-815-0111

Workshop: Why Every Investor

Must Learn the Note Business
New government regulations have forever changed todays real estate market. The repeal of the
Glass-Steagall Act, and the implementation of the Dodd-Frank and SAFE Acts have forced lenders,
buyers and investors to adjust. To simply continue to pursue the discount buying and exit strategies
we have always used will severely limit your investment opportunity and profit margins. These
adjustments have created both problems and opportunities that Veteran Note Investor Eddie
Speed will discuss on Saturday January 24th!
Eddie will share what Wall Street & the Insider Hedge Funds already know . . .
Understand why Non-Performing Notes are the New REO
Sell landlords loaded rentals using our innovative 50/50 model that will have you making lump sum

cash now and long term monthly cash flow

That you can profit while significantly helping people suffering from the mortgage meltdown
Make cash flow like a landlord without the hassles of being a landlord
Use your IRA or 401k to make tax free- often double digit returns
Why note investors are making double digit returns on investments right now
How to purchase notes without using any of your own money
Pull back the curtain on the Shadow Inventory being held by banks, HUD, Fannie and Freddie and

why the note business is the solution to the real estate crisis
How to Sell Your Properties Using Seller Financing
How to Flip Real Estate Notes Without Any of Your Own Money
How government mandates are driving the business!!
See case studies of real deals showing you how our students (some right here in Kansas City) are

closing hundreds of deals!

Eddie Speed has been selling out similar Saturday training events across the country, so we have
booked this event at the Holiday Inn so we are able to increase our room size. We still may sell out this
all day event, so be sure to register early, there may not be any at the door seats available. Saturday,
January 24th, Holiday Inn at 8787 Reeder Road in Overland Park, Check in at 8:00 and start at 8:30. We
will be serving Lunch around Noon. Register at www.MAREI.org or call 913-815-0111.
REGISTRATION
Regular Pricing: $49 for member, plus $20 for guest. $69 for non-member, plus $20 for guest.
Special Pricing on the MAREI Website at www.MAREI.org
Add $99 for Annual Membership for 1 or $149 for Annual Membership for two.

Total: _______________

Name: _____________________________

Second Person Name: ________________________________

Email: _____________________________

Second Person Email: _________________________________

Phone: _____________________________

Secondary Phone: ____________________________________

Address: __________________________________________________________________________________
Paid by Check: #__________

Paid by Credit Card: #_____________________________________________

Expire Date: __________ Security Code: ______________

Signature: __________________________________

New Location
We are excited to announce our new meeting location at the Holiday Inn &
Suites at 8787 Reeder Road in Overland Park, KS. Conveniently located just
off 69 & I35 Highways at 87th Street.

Meeting Agenda
6:00 pm: Networking & Vendors
6:00 pm: Announcements & Introductions
7:30 pm: State of the Industry with Eddie Speed
9:30 pm: Late Night Networking at Whiskey Joes Bar & Grill

Member
Forum
Do you have a question about
how to do something?
Do you need to run some ideas
by someone?
How about a referral?
Just want to connect?

Visit the
Member Forum!

Why Every Investor should

Learn the Note Business
One Day Workshop
To simply continue to pursue the discount buying and exit strategies we have always used will severely limit your investment opportunity and profit margins.
These adjustments have created both problems and opportunities that Veteran
Note Investor Eddie Speed will discuss on Saturday January 24th!
Eddie Speed has been selling out similar Saturday training events across the
country, so be sure to register early, there may not be any at the door seats available. Saturday, January 24th, Holiday Inn at 8787 Reeder Road in Overland Park,
Check in at 8:00 and start at 8:30. We will be serving Lunch .
Want more info, visit our website at MAREI.org .

Contact Us
Learn more about
Mid-America Association
of Real Estate Investors
Chapter of National REIA
Kansas City Office
8014 State Line Rd,
Suite 210
Leawood, KS 66208
(913) 815-0111
info@MAREI.org
Visit us on the web at
www.MAREI.org