Answer to questions 3 and 4 from Sunday’s Blog about TOP TEN items…

July 4, 2009 by admin
Filed under: Real Estate Principles & Disciplines

Here you go….

3) 50% Rule. What is this?

Answer: Most counties in the U.S. require that if you are spending more than 50% of the assessed value of the property being rehabbed you will need architectural plans prepared by a certified architect (OUCH!), special permits and engineer certifications, etc. to continue bringing the property up to code. SHOW ME THE MONEY!

4) Don’t install your Central A/C Unit in the kitchen area. Why?

Answer: There are two parts to a standard air conditioning (A/C) system. The compressor and the air handler. The compressor is outside and the air handler is inside the home. The air handler controls the air distribution inside the home via a thermostat (you know, the little box on the wall). Based on thermostat settings and the air temperature inside the home, the thermostat will turn the A/C system ON or OFF.

Kitchen temperatures will vary during the day. If you park or install the A/C’s thermostat inside or near the kitchen, it will follow the air temperatures occurring inside the kitchen. Can you see what problems are going to occur? ON/OFF all day costing you DINERO (MONEY for you non-Spanish speakers), etc.

Bonus: www.robertkburns.com/recommends/learntowholesale <=== Download Preston Ely's FREE eBOOK - "Learn to Wholsale".
(If link fails cut & paste this link: http://tinyurl.com/learntowholesale into your browser)

Bob Burns
www.investmentpropertiesmiamiflorida.com

Don
?
t make the same mistakes I did
?
look for a Mentor.

After an up and down career in the corporate world, I decided I had enough and wanted to start investing in South Florida Real Estate. After all, the baby boomers were maturing; the economy was humming along and everyone from where I’m from (Philadelphia - Home of the Eagles, soft pretzels with mustard, hoagies) wanted to retire in Florida. I though I was real smart. After all, I dabbled with Real Estate in Puerto Rico and was moderately successful. Man, was I WRONG! I should have gotten a Mentor to guide me!

Some of the many benefits my associates and MREIA members receive are the experience we offer them and because of the networking, the benefit of everyone else’s experience.

If you are a newbie (new to real estate) having someone, a mentor, to ask questions is a blessing. I am always saying - “Look at all the mistakes I can tell you about and how to avoid them while pursuing a deal or making a purchase.”

One of the things as a Newbie, that took me a while to grasp, was creating a business entity and team building to help achieve our objectives, reduce mistakes and limit risk.

Below is a brief outline of items you should address to help you get started in your real estate investment career or hobby:

Before you Start Looking for Deals:

- Make sure EVERYTHING IS IN WRITING.
- Join a Real Estate Investors Association REIA.
  - Miami Real Estate Investor Association MREIA
- Open a Florida Corporation
  - Create Articles of Incorporation
    - Identify corporate Officers: President, Treasurer, Secretary, etc.
    - Need to declare number of outstanding shares and price per share.
- Buy/Sell Agreement or Share Ownership Agreement.
  - Want the ability to move shares when board of directors change.
  - Make sure you have a Shotgun Clause.
    - Dictates that if you are in a partnership and the partners want to get rid of you, you have to be bought out.
- Company Seal
- Meeting Book
- TAX ID # or EIN #
- Print up Your Business Cards
- Business Bank Account
  - Documents Needed to Open an Account
    - Drivers License with Photo
    - Articles of Incorporation
    - Certificate of Status
    - EIN #
    - Signatures of Corporate Officers
  - Bank Stamp for Deposits
- Build Your Team
  - Real Estate Accountant
  - Real Estate Attorney
- Business Plan
- Attend Conventions
- Develop A System