Wednesday, May 23, 2012

Even Note Investing Has Guru Traps | REALTOR.com? Blogs

Even Note Investing Has Guru Traps: BiggerPockets Investors Corner photoquestionsRealtor.com is working with BiggerPockets.com, to bring beginning real estate investors helpful advice and tips for getting started in real estate. Join us here each Wednesday morning for wisdom directly from the BiggerPockets team:

Our education in any business is infinite, and my passion in note investing has given me the opportunity to meet with some amazing people in the note business and I actively look for new information to perfect my craft. Currently I receive daily newsletters and publications on the concept of note investing, some of which make me very nervous.

As the ?new? frontier of hands off, passive real estate investing there are more and more companies and gurus popping up teaching the concepts of note investing. From ?Defaulted Mortgages? to Non-Performing 2nd Mortgages? ?Note Funds? ?Trust Deeds? and a slew of other topics are hitting the web with vengeance all designed to make you a ton of money in a short period of time. Unfortunately, if you have been in this business long enough you realize all aspects of real estate investing take time and effort and there is no better substitute for experience as you perfect your craft. So, as I see all of these boot camps and programs that are designed to make you wealthy in notes with little to no money down I fear for the legitimacy of those that are actually trying to get into this business and do things the right way. Here are a few suggestions I can offer for those looking to get into the note investing world.

Find a Mentor- Like any other business strategy, working with someone that has seen the highs and lows and will offer advice for you to help you succeed is critical in this area of investing. Its less common to find a seasoned note investor at a REIA meeting, but if you look around you can find someone to help you grow

Learn Your State Laws ? Do you know if the state you are investing in is a foreclosure or forfeiture state? Do you know if there are unique statutes in your state that will have an effect on enforcing notes? Do you know what RESPA is? The SAFE ACT? After you find a mentor, meet with a good real estate attorney in your area that understands mortgage financing laws and learn as much about the state and federal law as you can. It will be worth the investment

Focus ? After you do these two things you head will be spinning with so many aspects of note investing you can delve into. Focus your efforts on the one area that most fits your personality and goals. Don?t worry about the glamorous case studies out there of other strategies. You will make money doing what you love and that you do passionately.

Keep it Simple ? Gurus and their courses are often filled with neat ?tricks? that you can apply to either speed up a process or circumvent a law. Keep those tips and tricks on the sidelines. Develop sound principles and build your note business the right way.

Note investing is truly a labor of love for me, and one that I think has been under the radar for too long. It is my hope that bad information does not destroy good note investors before they get started. Feel free to share your experience. Your feedback and readership is greatly appreciated.

This post by Kevin Kaczmarek was originally posted on BiggerPockets.com.

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About Deidre Woollard

Deidre Woollard is the Community Manager at Realtor.com.

View all articles by Deidre Woollard

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