MID-AMERICA ASSOCIATION OF

REAL ESTATE INVESTORS

Investment News
Read Online www.MAREInet.com Look under Resources

NETWORKING : EDUCATION : COMMUNITY February 2012

NEW MEETING LOCATION Ward Parkway Shopping Center Inside Across from Starbucks

MAREI
Notes
2011 National REIA Awards of Excellence Contact Information
PO Box 8685, Prairie Village KS, 66208 Phone: 913-815-0111

Our Mission Statement

Mid-America Association of Real Estate Investors is dedicated to promoting ethical real estate investing and to protect and promote the best interest of our membership through educational and networking opportunities as well as community, legislative and public relations.

Legal Disclaimer
MAREI does not exist to render and does not give legal, tax, economic or investment advice and disclaims all liability for the action or inaction taken or not as a result of communications from or to its members, officers, directors, employees and contractors. Each individual should consult his/her own counsel, accountant and other advisors as to legal, tax, economic, investment and related matters concerning real estate and other investments.

Honors Of Merit Electronic Communication & Membership Development

Content Disclaimer
The views and opinions expressed by authors of articles contributed to this newsletter do not necessarily reflect those of the association, the board of directors or the staff.

Advertise in the Investment News

Rate Schedule Size Full Page 1/2 Page 1/4 Page 1/8 Page Non-Member $175 $145 $75 $55 Member $140 $105 $65 $35 Business Associate $115 $85 $50 $25

A 10% discount is given on ads pre-paid for 6-12 months. Any changes to a pre-paid ad will incur a minimum charge of $20. The deadline to submit ad copy is the 1st of each month. All ads must be prepaid. Contact to verify ad format can be accepted. PDF preferred. There is an additional charge of $25 to typeset a business card ad or 1/4 page ad layout, $60 for a 1/2 page or full page lay-out. Opportunities also exist for advertising on www.MAREInet.com. Call 913-815-0111 for more information. Email ad copy to info@MAREInet.com. Mail payment to MAREI, PO Box 8685, Prairie Village, KS 66208 or request an online payment for to use credit or debit card.

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MAREI
Staff

Kim Tucker 816-523-4400 Director Kim@MAREInet.com

Don Tucker 816-523-4400 President Don@MAREInet.com

Steve Burns Audio Visual cashflowtreasures@gmail.com

John Welchert Meeting Ambassador 816-522-0002

Dan Goodwin 913-642-5218 Meeting Ambassador DanGoodwin@kw.com

Shelda Goodwin Meeting Ambassador SheldaGoodwin@kw.com

volunteers:

Be sure to thank our volunteers who

help out at each and every meeting making sure the entire meeting is a success. If you would like to volunteer from time to time to help set up, take down, or check in, or assist for a few hours in the business office, please email info@MAREInet.com or call 913-815-0111. Need: Blog Articles, Newsletter Articles, Workshops for Members, Guest Speakers, Office Assistance, Web Master . . . If this might be you, let us know!
Investment News
Scott Tucker Meeting Ambassador STucker319@gmail.com

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ei ar m
Type Insurance Lender Partnering Prop Mgr Prop Mgr Prop Mgr Realtor Security Staging Supplier Title Company APIA Argentine Federal Savings kcmoHomeBuyer Abraxas Prop Mgmt Jamieson Home Team Premier Leasing Realty Resource Devcon Security ShowHomesKC Canyon Stone Accurate Title Company Web REOIns.com

BUSINESS MEMBERS
ADDRESSING THE NEEDS OF
Phone 877-752-2742 913-402-1500 816-523-4400 816-474-8800 816-503-4671 816-841-9500 816-523-4400 913-907-4942 770-853-3506 913-254-9301 913-338-0100 Contact Lisa Goodner Ann Wilkinson Don Tucker Meka Cayce Kevin Jamieson Jeff Woods Kim Tucker Marian Collins Amanda Palomba Matt Puckett Jackie White ArgentineFed.com kcmoHomeBuyer.com AbraxasMgmt.com JamiesonHomeTeam.com MyPremierLeasing.com RealtyResourceKC.com DevconSecurity.com ShowHomesKC.com Canyon-Stone.com AccurateTitleco.com

Real Estate Investors and Landlords depend on a well rounded team of professionals. If you are building your team or looking to make a trade, start your recruiting with our Vendor Members and Business Associates. See a complete list of suppliers and any discounts they may offer to MAREI members by visiting, www.MAREInet.com.

www.MAREInet.comService Providers Located Under Resources Tab

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Contents
In This Issue

MAREI News
The Fine Print MAREI Meeting Staff Business Members Contents Directors NotesAssociation Update What is Asset Protection Member Benefits at a Glance Bandit Sign Police Community Buying Groupmore benefits Insurance 101: Insuring Vacant Properties Welcome New & Returning Members Calendar of EventsSubGroups The Note Business Investment Properties Preview of New Website 2 3 4 5 6 8 10 12 14 16 18 20 22 24 26

Because of Valentines Day Our meeting is being moved to Thursday February 9th!

February Meeting Protect your Assets!

Find out how to protect your hard earned assets with MAREIs own Mark Klinkenberg. Thursday February 9th, from 6 to 9 Note the meeting format will be a bit different, come prepared for a mini speed networking from 7:00 to 7:15

Member Benefits
New member orientation will cover many of our member benefits. If you are new to MAREI or just have some questions please join us at 6:30 at the January Meeting when we will go over all the benefits of being a member. Members and Guests welcome!

Investment News

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Directors Notes
Here at MAREI we have been working for the past year to find a way to get all of our members more involved both at the meetings and at other times. Why, because everyone benefits when everyone participates. For my own investing, from when I was just getting started ten years ago to present day, when ever I take an active part in our REIA group or others that I have been a member, I received a lot of benefits. Benefits like meeting new people that I need in my business or who have done business with me. Benefits like helping a new investor learn something and learning some things myself along the way. So we have decided it is time to take MAREI to the next level to help MAREI grow as an association and to help our members in their businesses. We had a start last month with our new meeting format that shortened took out the beginning monolog and replaced it with a miniSpeed Networking, so you meet more people. We also start the presentation earlier so we finish earlier. And we have added a New Member Orientation at 6:30 so that our members dont have to hear the join MAREI presentation. During the month of February we will see a few more changes at the meeting, that are beyond our control. Career Education Systems (where we have our meetings) is moving within Ward Parkwayso be sure to enter by Starbucks on the State Line side of the mall. We are also meeting a few days early on Thursday the 9th, so we are not interrupting Valentines Day Dinner. Then when you go to the website you are going to start seeing a different format and a more interactive website. Its not yet perfect, but we want to roll this out now rather than waiting for perfection. So what will you see in February:

Property Marketing Page instead of a Classified Section that will allow photos and video, plus has a search feature. Forums that are more interactive and easier to use. Blog Posting for MAREI members that have an educational message to share.

If you visit our www.MAREInet.com before our new site goes live, look for the sneak peak link to check it out and read some of the how to instructions in this newsletter.

Kim Tucker Director

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Wireless Security Systems

Keypad, 3 doors, 1 motion, 1 primary & 1 door siren One time Charge of $99 plus tax Includes installation Requires 36 month contract. Monthly Monitoring Fee $39.99 Sell house transfer to new owner or move to new house DevconSecurity.com Marian Collins: 913-907-4942

Management Solutions to help your properties Operate Smoothly Increase Desirability Enhance Investment Value Attract & Retain Tenants Find us Online www.AbraxasMgmt.com 816-474-8800

accurate

Accurate Closings: Smooth, Timely, Professional.

Title Services Provided for: FSBO, Wholesale, & REO Transactions New Construction Closings Commercial Purchases and Refinance All Types of Loan Closings 1031 Exchanges FHA, VA, USDA, Conventional Loans, and Hard Money Loan Closings Refinance & Reverse Mortgages Doc Prep, Prelim HUDS, Curing Issues Short Sale Closing & Assistance 100 Years of Combined Service!
www.AccurateTitleCo.com 913-338-0100 phone

On Demand Training 30 Minute Segments Top Investor Trainers From the Comfort of Your own Internet Connection $39.00 Training Courses
REO & Lease Option Creative Financing Automated Investments Auctions & Foreclosures Short Sales Government Grant Money

www.MAREIU.com
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Investment News

What is Asset Protection Why Should I Care

Asset protection (sometimes also referred to as debtor-creditor law) is a set of legal techniques and a body of statutory and common law dealing with protecting assets of individuals and business entities from civil money judgments. The goal of all asset protection planning is to insulate assets from claims of creditors without concealment or tax evasion.* Methods of protecting assets include protecting them from liabilities that arise elsewhere. So for example as a real estate investor you may hold assets in your personal name such as your life savings in stocks and CDs. When you purchase a real estate investment, you would want to take ownership or title to that investment in a way, that if something were to happen at that particular property that would cause someone to sue the owner of that property, that your personal life savings is not at risk. As the Real Estate Investor in this scenario you would not want to take title in your own name, but in that of a legal entity that would shield you personal from liability and at the same time have that legal entity insure itself properly to limit the risk of any potential law suit. This same concept would apply to just about any business owner out there. For example Bill Gates with his vast fortune does not go out there and build and sell computers under the name of Bill Gates. If one of his computer software were to be discover to be hugely harmful to the general public and he were to be sued, he could loose every-

Monthly Meeting
January Monthly Meeting: Thursday February 9th, 2012,
6pm to 9pm Career Education Systems, FREE for members, Guests $25 at the door, $15 if you preregister We will be discussing Protection of YOUR Assets.

Dont miss this event!

Agenda 5:00 Set Up 6:00 check in 6:00 vendor hall 6:30 new member orientation 7:00 mini speed networking 7:15 guest speaker:

MAREInet.com

Ask yourself some basic questions using our Asset Protection Checklist. Everyone who attends the meeting on Thursday February 9th Attorney Mark Klinkenberg will receive a free copy.

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thing. Instead he formed a corporation to do business, to protect his personal assets. So no matter where you fall in business from a landlord with one rental property, to a small business owner conducting business with the general public or you have a vast wealth like Bill Gates, you need to take steps to protect your personal assets from outside liabilities. The first step is to form some sort of legal entity or even several to hold your assets and under which you conduct business. Besides the risk of being sued, another outside liability is the government with their hand out wanting more and more of your

hard earned income in taxes and fees. So this brings us to the second step of asset protection which is determining the best legal entity to form given your situation that will give you the best lawsuit protection, best reduce your taxes, and not cost you undue expense in maintaining the entity. While there are corporate entities that will protect you greatly, the cost and expense of creating them and maintaining them could far outweigh the benefit. So you need to find the best balance for your needs.

At the February meeting our guest speaker Attorney Mark Klinkenberg is going to be taking discussing asset protection, so that you have the frame work you need to start planning for your own asset protection or to review your current system.
* from Wikipedia

Investment News

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MAREIS MEMBER BENEFITS PROGRAM

AT-A-GLANCE
USE THIS PAGE AS A GUIDE TO VALUE ADDED DISCOUNTS TOOLS AND SAVINGS CREATED JUST FOR YOU ON GOODS AND SERVICES YOU USE EVERY DAY.

YOUR MEMBER BENEFITS

Landlord Services

Suppliers

Marketing

Screening for tenants & workers with 20% discount for members.

Learn how to save money at Home Depot and register for a 2% Rebate for all purchases & rentals across the US.

Affordable Landlord Websites with a 15% discount or free trial for members.

Electronic collection for bounced rent checks. No charge to you.

Websites for investors, landlords, and other services. FREE trial.

FORMS & DOCS

Member Library is packed with forms and docs, plus 15 % discount at EZ Landlord Forms for premium forms.

All members receive a discount card to access our exclusive discounts up to 40% off all paint, supplies, and flooringnationwide.

Service Provider

Discount card for all members providing a 10% discount on all services. Market your rentals on the nations top ranked rental site. Member discount is 20% off Regular Prices. Members have access to many great tools and savings including discounts of up to 7% - nationwide.

News & Information E-Update

Our weekly email update with whats happening in real estate including properties for sale, government affairs and local market data.

Office Solutions

Save on select FedEx Office copy and print services up to 20% and on FedEx Shipping up to 22%.

Discounts of products through Sears Commercial plus 5% off Gift Cards.

Investment News
The newsletter for Mid-America Association of Real Estate Investors: published monthly and distributed both in print at our meetings and digitally to our database of over 5000 people.

Membership

Receive discounts up to 65% on over 12,000 products you use the most online and in store.

FREE membership in Community Buying Group for all MAREI members to bring you even more great discounts.

Continued . . . .

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Member Service
We have several services as part of our website to help you grow your business. MAREIs Government Affairs actively monitors national legislation and rule-making that impacts the real estate industry and harnessing the strength of MAREI members at the grassroots level. Calendar of Events to stay up to date with all of our activities. MAREI members also receive timely Calls to Action when there is a time for our members to take action on an important vote. Members also have access to the latest in Market Data.

Magazine for the real estate investor. With discount subscriptions for MAREI members.

Other Discounts

Nearly 70% of QuickBooks users say that it makes their business more profitable. Get your Accounting on track. Buy at a 40% discount through National REIA.

REAL ESTATE BOOKS

The nations largest provider of real estate training materials, DEARBORN is Americas Premier Real Estate Publisher. Members receive up to 40% off.

Browse the member properties to find your next deal. Take the time to post your investment opportunities for other members and site visitors to browse.

VISIT
Special member discounts for members at Avis, Budget, and Enterprise Rentals. The Member Library is packed and ever growing with pdf versions of entire books, EBooks, Articles, Forms, and Documents. ww.MAREInet.com Look under Resources Discounts

Investment News

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Bandit Sign Police

We found this quote online from Councilman Curtis Jones Jr in Philadelphia: As if we didn't have enough litter on the street, the city also has too much rubbish nailed to poles. We're talking about "bandit signs": small signs plastered on streetlights and utility poles all over Philadelphia advertising businesses with classy slogans like "Top Dollar Paid for Junk Vehicles" and "We Buy Houses." They're ugly and a bane for neighborhood groups trying to improve the city's quality of life, not to mention its property values. And, believe it or not, given their omnipresence, the signs are also against the law. Real Estate Investors have long been taught USE BANDIT SIGNS because they work. But in many areas, the Bandit Sign Police will call you up and tell you to come remove them or they take them down and toss them out. Recently they in Kansas City Missouri they have been issuing fines to the people posting. We heard from one member recently who received a $2,000 fine. So fair warning to all in the Kansas City Metrocheck with your local municipalities regarding the legality of posting a bandit sign. Most cities seem to be concerned with them being placed in the city right of way. That means on most roads that so far in is city right of way, so if you set them up far enough back you are ok. Most cities also include all land between the sidewalk and the street as right of way. So only place signs on the inside of the sidewalk, not the outside by the curb. So while bandit signs work, the cities and home owners associations do not want to see them. So what can we do? Put them up and Take them Down: If you have a house for sale or rent and are holding an open house consider putting them up the night before your event and taking them down at the end of the open house. Only in Private Yards: Now this may not work in areas governed by Home Owner Associations, so check,
MAREInet.com

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but only place your signs in the yards of properties that you own. Or if there is a yard in a prime location, approach the owner to see if you could pay them something to put up the sign in their yard. On the House: This one is unique and will catch a lot of attention. One big HUGE

banner attached to the front of the house during renovation. Or a variation that was very unique was having a huge We Buy Houses Banner on either side of the dumpster that sat in the driveway for a month in front of a house on the corner of a very busy street.

On your Car: If you are not out driving around in the same area a lot, car signs probably will not work on your car. Do you know someone who has a car parked in a very visible space all daysay friend that works at WalMart or your contractor. Slap some signs on those vehicles.

HOUSES WANTED
Built After 1950 Minimum 3 Bed, 1.5 Bath Eastern Jackson County
MO or Johnson County KS

More Information . . . More Confidence

Retail Value $100k-$200k No Rental

Local Cash Buyer Looking for 2 to 4 Houses a month to purchase, rehab and sell. Money Partners want their money placed quickly so they can turn their money fast and make a profit. Cant do that with out houses! Bring us a deal!

More Profits
Tenant Screening Pre Employment Screening Contractor Screening Collection Services

Email: kcmoHomeBuyer@gmail.com Submit Online: kcmoHomeBuyer.com

Investment News

Discounts for MAREI Members

www.AAAScreening.com 816-436-0085 Page 13

At the end of 2011 MAREI formed an exciting partnership with Community Buying Group. Through our partnership with Community Buying Group, all MAREI members can participate in the Community Buying Group discount program to save money. You can see all the many benefits we already provide on our Benefits at a Glance on pages 10 and 11 of this newsletter including the new discounts at Community Buying Group. You will find detailed instructions on how to access all of your benefits that we bring you directly from our association and step by step instructions on how to activate your FREE membership with Community Buying Group. To register your free membership with CBG 1. Go to www.CommunityBuyingGroup.com 2. Click on the Pricing Tab at the Top 3. Choose The Investor ($99) Plan 4. Enter our Special Code (found on the Member Resources Page) in the Group Code Box 5. Click Redeem to bring price to zero 6. Fill Out the rest of the Registration Page 7. Agree to the Terms of Serice 8. Click Continue

Now you are in and can click on the Suppliers Tab at the top to find out how to access your discounts for:

Lowes Sears Commercial Nu-Set Locks Build-A-Sign Transworld Systems QuickBooks RentFast Ring Central Sunbelt Rentals And others

But there is more to your membership with CBG than just discounts and that is the Community part. So what are your next steps. Click on the Profile Tab at the top and fill in all your information. Be sure to join the Kansas City, Missouri Community and add your industries to your profile. Next upload a photo or a logo to your profile. Be sure to save everything. If the page gives you an error use your back arrow key to go back one page or refresh the page, it does sometimes get stuck.

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Next go back up to the top and click on Vendors, this is where you and all your fellow CBG members can share what you have to offer. Browse through and see what other services

your fellow members have to offer. Many of our MAREI members are real estate investors or landlords and something else. Be sure to include that something else. If you see a

service provider that you have used before, be sure to give them a rating to help them gain more business in the future.

Be sure to Join Now (Or Renew) Go online at

Do the math.
Your vacancy is costing you every day. Fill your vacancy faster and save money with Rentals.com!

For everyone that joins now or at the meeting on Tuesday we have several free giveaway items for you to choose from: Buying Real Estate without Cash or Credit
(Peter Conti & David Finkel)

Discounts for MAREI Members: Receive 20% off all Regular Priced Advertising. Log into Members Area, click on Member Discounts and look for MAREIs Discount code!

How to Create Multiple Streams of Income

Buying Homes In Nice Areas with Nothing Down (Peter Conti & David Finkel

Buy Even Lower,

The Regular Peoples Guide to Real Estate Riches (Scott Frank & Andy Heller)

Investment News

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Insurance 101
Insuring Your Vacant Properties
CAUTION: VACANCY CAN BE HAZERDOUS YOUR FINANCIAL INTERESTS One of the recurring comments and/or questions I hear from potential clients when discussing their insurance coverage for vacant properties is The agent didnt ask if it was vacant or even more concerning, The agent told me vacancy is not a problem. Even worse if your agent tells TO you to place a little furniture in the property and call it occupied. The single most important clause for you to read on your insurance policy where you have a vacant property insured is the Vacancy Clause. Every policy has a Vacancy Clause. Following is an example of the Vacancy Clause wording: Coverage under this policy will be suspended effective 60 days after the building becomes vacant. This coverage will remain suspended during such vacancy. If you purchase a policy for a vacant property, which has the above clause in the policy do you think you have coverage in place? Unfortunately, most of the calls I receive from potential clients
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needing insurance coverage immediately is due to an inspection conducted by the insurance company discovering the property is VACANT. The policy is cancelled immediately. Even more unfortunate is

when a claim is filed and denied due to the property being vacant. Please review your insurance policies on your vacant properties. Should you have any questions regarding vacant properties or

the Vacancy Clause feel free to contact me. See my contact information in the ad below for Asset Protection AgencyAPIA at www.REOIns.com and look for us at the February Meeting.

Asset Protection Insurance Agency www.REOIns.com 877-752-2742

Property Management Rental Services Kansas City Metro

www.JamiesonHomeTeam.com Kevin Jamieson Real Estate Owned / Forced Placement For Investors & Finance Institutions 816-503-4671

Investment News

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New Members

Renewing

Helen Bartlett: Fairway, KS Dave Duncan: Kansas City, MO Steve Hillyer: Kansas City, MO Nancy King: Kansas City, MO Joe McDonald: Wichita, KS Kristie Plough: Parkville, MO Jim Rettor: Shawnee, KS Tom Smith: Lees Summit, MO Phyllis Swaggerty: Blue Springs, MO Daniel Weisner: Grandview, MO

Jerry Blair: Weston, MO Rickey Hampton: Overland Park, KS Makeba Hart: Independence, MO David Justice: Lees Summit, MO Jeff Larson: Kansas City, MO Sandy Moll: Paola, KS James New: Kansas City, MO Phil Rich: Omaha, NE

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Property Management Section 8 Housing KC Metro Wide

Presentation is Everything! Canyon-Stone.com

Jeff Woods Broker www.MyPremierLeasing.com 816-849500

550 E. 56 Highway, Suite B Olathe, KS, 66061 Phone: (913) 254-9300 Fax: (913) 254-9301 info@canyon-stone.com www.Canyon-Stone.com

Sell Vacant Houses Faster and for more money!

How? We transform vacant houses - often seen by buyers as stale, lifeless, unappealing into fully-furnished, inviting, valued Showhomes. Now in our third decade of service to Homeowners and their Realtors, we've become America's premier home staging service coastto-coast. Our professional home staging services can add thousands of dollars to your sale price -- and at the same time reduce the stress and expense of marketing your property.

Flexible rehab options and purchase financing for qualified investors! Ann Wilkinson Vice President Mortgage Loan Production 12501 Antioch Rd Overland Park, KS 66213 Ph: (913) 402-1500 Fax: (913) 402-0673 AnnW@ArgentineFed.com www.ArgentineFed.com

ShowHomesKC.com
Amanda Palomba 913-227-4364

Investment News

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CALENDAR
Locations, Cost & Registration at www.MAREInet.comsee Calendar
Wednesday, February 1

events
,
Wednesday, February 15

Buying & Selling: Webinar Every Day Credit Repair: Webinar 1st through 15th 9:00am Sub-Group: Weekly Wednesdays

9:00am

Sub-Group: Weekly Wednesdays

Saturday, February 18

Saturday, February 4

4:00pm SubGroup: Blue Springs / Independence Real Estate

4:00pm SubGroup: Blue Springs / Independence Real Estate Investors

Sunday, February 19

Sunday, February 5

9:00am Sub-Group: Lees Summit Real Estate Investors

9:00am: Sub-Group: Lees Summit Real Estate Investors

Wednesday, February 22

9:00am Sub-Group: Weekly Wednesdays 5:30pm Sub Group: Commercial Real Estate Investors

Wednesday, February 8

9:00am

Sub-Group: Weekly Wednesdays

5:30pm Sub Group: Commercial Real Estate Investors

Saturday, February 25
4:00pm SubGroup: Blue Springs / Independence Real Estate Investors

Thursday, February 9

6:00pm Monthly Meeting of MAREI Protection

Asset

Sunday, February 26

Saturday, February 11

9:00am Sub-Group: Lees Summit Real Estate Investors

4:00pm SubGroup: Blue Springs / Independence Real Estate Investors

Wednesday, February 29

9:00am Sub-Group: Weekly Wednesdays

Sunday, February 12

9:00am Sub-Group: Lees Summit Real Estate Investors

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Save the Date . . Saturday March 17th Notes Buying Workshop

Cash in on the meltdown of the mortgage markets. Turn a profit from the implosion. Fill the void left by conventional lenders with seller financing. More and more property sellers are carrying a loan for the buyer and they want to sell and you can make a profit. By creating real estate notes, in

vesting in them, or simply brokering them, YOU can make substantial money with minimal expense. There driving around looking at houses, no repair bids, contractor schedules, tenant phone calls, or open houses. Workshop lead by 30 year veteran note buyer, trainer, and author Eddie Speed.

Earn 5 PHP Credits in Purchasing

THANK Y

OU!

Larry Prato Commercial Subgroup

Spencer Cullor Commercial Subgroup

Debra Felderhoff BS, LS, Indep Subgroup

Michelle Winberry Weekly Wednesdays

Many thanks to our Volunteers who sponsor a Networking. If you need more networking and interaction, please check out the Networking Group on the Calendar. First Networking event is free and does not require membership. After that if you want to continue as a part of the subgroup, we request that you become a member of MAREI to gain more knowledge and access all the tools and benefits of membership.

Group Facilitators for the following Groups wanted: Northland Investors, Joco Investors, Short Sale Investors, Landlords, Note Buyers.

Investment News

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The Note Business

From Moms & Pops to Profits
You've heard it before: To succeed at anything, you need to learn all you can about it. After all, the more educated you are, the smarter your decisions will be. You'll work smart --not hard-- and your actions will deliver the best results. That's why you need to get smart about notes. It's at the core of your success in the note business. A solid foundation for any business starts with a little history. This report tells the story of notes, from their simple beginnings to where they are today. With this knowledge, you can build on your own business foundation and, perhaps, affect the future of notes through your business success. Notable Beginnings: Mom and Pops In the early 1980s, interest rates reached record highs of 18% or more. Conventional financing proved tough for many buyers. Anxious to sell their homes, property owners created affordable notes. The process was simple: The buyer assumed the seller's first mortgage; the remaining equity would then finance an owner carryback second lien note. Thus, the note business was launched. It thrived on high interest rates, and featured three key elements:

business around locating and negotiating to buy these loans at a discount. The profession of note brokers was established. Interest Rates Drop; Enter the Pros In the 1990s, interest rates began to plummet. Conventional loans became affordable, which threatened the very future of seller-financed notes. But then, a huge influx of professional real estate investors entered the note business. They changed it, expanded it, and ultimately saved it. These investors manufactured notes, primarily through the acquisition of distressed real estate. They created an everincreasing volume of loans. No longer chasing individual notes from Moms and Pops, we began to see notes from the same sellers repeatedly, and even pools of notes held by the same real estate investor. We also saw a drop in the average sales price of properties, because the investors were dealing in more affordable housing. This lower priced property was more of a finance-company product rather than a transaction underwritten by a bank or mortgage lender. To acquire quick and easy financing for buyers, the investors turned to seller financing. As many as half of the notes that were purchased came from professional sellers. Also entering the mix of seller financing were land developers who started subdividing land, and allowed mobile homes MAREInet.com

There were plenty of notes, mostly from the Mom and Pop sellers. Funding sources were available for the purchase of these notes. Entrepreneurs were willing to build a

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within their deed restrictions. These mobile homes could be financed quickly through a chattel mortgage, and the developer would finance the land. The key ingredient was to offer financing to the buyer. The increased activity from the professional investors and developers produced a whole new inventory of notes that were created on a recurring basis. We classified these types of seller financiers as Professional Sellers of notes. From Boom to Gloom The last half of the 1990s was considered the boom time in the note business. A major player was The Associates, an aggressive a finance company that tolerated sub-prime credit and collateral. The Associates created more entrepreneurial opportunities and jobs than our industry had ever known. A significant amount of the loans they purchased came from real estate investors on stick-built houses or from land where a mobile home occupied the lot. But a corporate takeover of the Associates in early 2000 brought an end to their involvement in the note-buying business. This left a huge gap in the funding available for this type of notes.

Adding to the note-business crunch, manufactured-housing production was down by 70%. This affected note inventory levels dramatically. The early 2000s were the dark days for the industry. New Fortunes in Notes The good news is that the note business is rebounding. Since 2001, three significant developments have fueled this resurgence:

A Bright Future for the Note Business; A Successful Future for You! The profile of the property seller has changed over the years, but a fundamental principle still holds true: Seller financing is always created when there's a void in the conventional lending market, whenever affordable financing is unavailable through conventional means. This is when seller financing comes to the rescue. Factors that affect the demand for seller financing include high interest rates, borrower underwriting, acceptable collateral, and adequate time to process and close a loan. These factors lead to a solid conclusion: There is a bright future for the note business and for those who participate in it. In fact, I've never been more excited about this business than I am right now. Now, the question is: Are you ready to capture the opportunities that await you?

Funding sources have become far more aggressive and plentiful than they were just a few years ago. These include the growth of current funding sources and from new investors, as well. As a result, there's significantly more money available to our industry. With record high oil prices, we'll likely see a continual increase in interest rates. Rising rates will increase the need for seller financing and, therefore, the inventory of notes. New and innovative marketing strategies are stimulating activity in the note business and generating record profits. We'll discuss these proven strategies in an upcoming report.

About the Author: W. Eddie Speed is the president of Colonial Finding Group, LLC. He has been buying seller-financed notes for more than 25 years, with a lifetime volume of note purchases exceeding 500 million. He is coming to Kansas City in March to teach and all day workshop on Seller Financed Notes and the Buying and Selling of Notes. If you are looking for another niche to add to your real estate investing portfolio or you want to get into real estate but do not really want to deal with property inspections, contractors, tenants and everything that goes with the buying and selling of investment property, then you need to be a this workshop in March. Learn more about Eddie Speed and Buying Notes now, visit: www.MAREInet.com/EddieSpeed for a short 6 minute video.

Investment News

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PROPERTIES
3703 E 68 St Kansas City, MO 2 Bedroom 1 Bath $12,500 Christoph Becker BlueprintProp.com 816-419-1165 7940 Madison Kansas City, MO 2 Bedroom 1 Bath Make Offer Rick Scheurer 816-813-2400 Oak Grove, MO Duplex Jason George JAG Enterprise, LLC 816-365-2032

Lone Jack, MO

New Investment Homes

60% Below Construction Make Offer

Danny Hammond Eagle Bay

816-985-4950

Mapleview Grandview, MO

3 Bedroom 3 Bath

Mike Bryant JacomoProperties.com Christoph Becker BlueprintProp.com

816-226-7299

3808 E 25th St Kansas City, MO

3 Bedroom 1 Bath

$7,000

816-419-1165

1748 Bristol Ave Kansas City, MO

4 Plex 2 Bdrm Units 3 Bedroom 2 Bath

$25,000

Charles Burks Exit Realty

816-220-8800

13009 12th St Grandview, MO

Estate $38,500

Randy Rodgers

816-726-3968

3509 E 30th St Kansas City, Mo

3 Bedroom

Turn Key $15,000

Christoph Becker BlueprintProp.com

816-419-1165

3 Bedroom 2 Bath

Phillip Rich Owner / Agent

913-219-4023

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MAREInet.com

5038 Bellefontaine Fixer Kansas City, MO

$10,500

Christoph Becker BlueprintProp.com

816-419-1165

3825 E 67th Tr Kansas City, MO

Minor Repairs

$12,500

Christoph Becker BlueprintProp.com

816-419-1165

3212 Bellefontaine 6 Bedroom Kansas City, MO Turn Key

$37,000

Christoph Becker BlueprintProp.com

816-419-1165

9236 Wyandotte Kansas City, MO

MLS Listing

$65,700

Joe Clark Reece & Nichols

913-384-8331

18916 Arrowhead Drive Independence, MO 3235 Lockridge St Kansas City, MO

4 bedroom Fixer

$37,000 MLS listing

Joe Clark Reece & Nichols

913-384-8331

2 Story Plus

$14,700 MLS Listing

Joe Clark Reece & Nichols

913-384-8331

3633 Indiana Kansas City, MO

2 Bedroom

$17,000

Christoph Becker BlueprintProp.com

816-419-1165

3601 E 60th St Kansas City, MO

3 Bedroom 1.5 Bath

$17,000

Christoph Becker BlueprintProp.com

816-419-1165

9214 Manchester Kansas City, MO

3 Bedroom 1 Bath

$37,700 MLS Listing Turn Key $20,000

Joe Clark Reece & Nichols

913-384-8331

3124 Chelsea Kansas City, MO

2 Bedroom 1 Bath

Christoph Becker BlueprintProp.com

816-419-1165

5637 Highland Kansas City, MO

4 Bedroom 1 Bath

$24,500

Christoph Becker BlueprintProp.com

816-419-1165

See More Properties in our Resources Section Online

Investment News Page 25

NEW WEBSITE IS LIVE

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www.MAREInet.com

Investment News

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