How to make $10,000 in one month

Posted by Anonymous , 9/4/2007 Tags:000 one month

Story Highlights

Introduction I'm a millionaire so listen up...If I was desperate and no credit, here's what I'd do

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Introduction

I'm a millionaire so listen up...

If I was desperate and no credit, here's what I'd do to quickly generate at least $10,000 in one month, and it's so ridiculously easy you'll be astonished!!!

Instructions

Difficulty: Moderately Easy

Things You'll Need

credit card

Steps

Step One

Okay you want to make some really quick, easy and legal money...here's what you do...

You need about $1000 dollars in order to do this. So you start by getting that. It could be gained from anything like: cash in your bank account, tapping savings accounts, cashing in RRSP's or 401K plans, getting a title loan, getting a short term loan from a Money Mart, getting a bank loan, asking a friend or family to lend you the money, selling off some old junk you no longer need, working some overtime hours, doing some odd jobs like mowing peoples lawns, getting a cash advance on a credit card, holding a garage sale, anyway you get the idea. The point is you need at least $1000 to get started. (maybe you could pull it off on $500 but try to get $1000)

Step Two

Next...you should also start by checking local real estate laws to find out if flipping real estate contracts in your state or province is legal. Ask a lawyer, not a realtor. It is legal in most states and provinces, but you should double check. Flipping a real estate contract simply means you go out and get an accepted offer on a property. Then you in turn sell that real estate contract to a thrid party. The third party then proceeds to close on the property and buy it. It's so easy it will blow your mind....just watch...

Step Three

Next, find the local real estate investment clubs in your city or town. Usually in most cities there's more than one. These REI clubs are simply a group of ordinary people who invest in real estate who get together regularly to talk shop. So go to their meets just to check out the atmosphere. Make up some business cards on your home computer and just be friendly with people there and you'll make some contacts. (making contacts is optional, the point is you just need to find out where the real estate investors are gathering each month).

Step Four

Next, go out and find a very inexpensive condo, townhouse, duplex or house. If it's a duplex or a house try to find something that might already be divided into two separate units, or has the potential to have the basement converted into a separate suite. (often known as a basement suite or non conforming suite...basically turning 1 dwelling into 2).

Step Five

The way you find these inexpensive properties is you look on your local MLS website, also look in newspapers, real estate papers, for sale by owner websites papers, contacting realtors, and on realtors websites. Do a search on google for websites, mls, for sale by owner, real estate papers that are available in your area. Also ask realtors they will tell you, or ask others who are in the business they'll tell you what papers and websites list all the properties for sale in your area.

Step Six

Next...here's what you want to try and find. You're trying to find a property that at least is breaking even, or has a small amount of cash flow at the end of the day. It's not hard. Just do the math. Say you find a duplex that has a side door with a separate entry leading into the basement, or a house with a basement that could be used a separate suite. Say it's going for $150,000. Find out what people are paying for the rent upstairs, and also try and calculate what the basement could be rented for. You should try and do some basic math. Use a mortgage caculator which you can find online in order to determine what the monthly mortgage payment on a property for $150,000 is going for. For example purposes I've used a mortgage calculator at mortgage-calc.com to compute the following:
Monthly payment: $ 997.95 a month
30 Years
Interest rate: 7.000%
Loan amount: $ 150,000.00

That means whoever owns this property needs to basically make at least $1000 from the rental income of both upper and basement units in order to pay the mortgage. So try and find something where say you could rent the upper floor out for perhaps $1000, and the basement for $650. That means the property would make enough to both pay for the mortgage and generate $650 per month in positive cash flow.

Step Seven

Next...so when you find a property like what I've described you contact the Realtor who has it listed and tell them you want to make an offer. What you 're gonna do is try and get an accepted offer on the property. Then you'll simply sell off the purchase contract to one of the real estate investors at the club I mentioned. It's easy. So you go to the realtor and you tell him that you found this property and you want to make an offer.

Step Eight

Your offer will look like this:
Asking price $150,000 (say for a duplex with up / down suites or potential)
Your offer: $150,000
Initial Downpayment: $1000
Additional Downpayment: $20,000
Balance: First mortgage
Conditions: 30 days to remove financing conditions.

What this means is that after you get an accepted offer you'll have a full 30 days in order to remove conditions. That means you have the option to either buy it, or back out within 30 days. You're not going to buy it, so what happens is that after 30 days the contract becomes null and void and you simply get your $1000 deposit back. I guarantee you won't even have to make very many offers before someone will accept your offer. Once you have an accepted offer you have to give your $1000 deposit and that gives you 30 days to do what's known as "flipping the paper". (selling the contract to someone else)

Step Nine

When you write up the contact you "must" under where it says: Buyers Name put down: (your name) "John Henry and or nominee". It must say "and or nominee". That gives you the right to sell the contract to someone else. When you're signing up the contract just tell your Realtor that you want to have "and or nominee" in the contract. If they give you any problems or start asking you questions like "why do you need that in it?"...you don't have to tell them anything. Just say that you want that in the contract. If you need an excuse as to why, (only if they ask you why) you say: "I just want to have a back up plan to sell allow my father to buy it for me in case I can't get a mortgage". And you do not say this to the seller, only to the realtor and only if they ask you "why". Try not to talk much to the buyer. Let the realtor talk to the seller for you to allow you to avoid any questions as to why you want that in the contract. And don't worry it's used all the time so it's really should not be a big problem. Most people have no clue why that would be put in the contract. And again it's put in under why you're write in your name "John Henry and or nominee", in order to allow you to sell the contract to someone else.

Step Ten

Now once you have a contract you're way. Get the realtor to give you what's called a "realtors listing sheet" on the property your buying. That contains all the details of the property. Such as address, picture, year built, type of dwelling, bedrooms, bathrooms, size etc... Then also do some research on how much you could rent out the upper and lower unit of the duplex or house for, which you would have done in the earlier step. So write it out and make sure it's comparable to what other properties rent for in that area. It has to be realistic. Write it all out. If you want to make it look very sophisticated write it out in the form of what's called a property proforma. Google that word in order to see what a comparable proforma looks like. That simply gives an investor an idea of what the potential returns are on that property. Its' not necessary but it would help to have some basic proforma made up.

Step Eleven

Now make some copies of the proforma, and the listing sheet and any decent photos you might have taken of the property. Staple them together and bring them to the local real estate investors clubs. Then just network with people and tell them you have a property under contract and that you're willing to sell the contract for 4%. So if you sell one contract that means they pay you 4% or $6000 ($150,000 x .04 = $6000), also on top of that they must pay you your deposit. So 4% of the purchase price, plus they pay you back your deposit money of $1000, so for a total of $7000. You then assign the contract over to the new buyer. Now they own the contract and can close that deal if they so choose. And for your work of finding the property and simply tying it up you've made $6000 on a $150,000 property. Keep in mind that this is just an example. Many real estate investors buy all kinds of properties ranging from apartment style condo's all the way up to apartment buildings.

Step Twelve

That being said...you might start out small flipping contracts on small condo units, duplex's, town houses, or houses (with basement suite potential). Each of which you might make between $5000 to $20,000 per flip. In time you could quickly have enough funds to begin tying up whole apartment buildings. And once you can do that you'll start making very good money. For example you find a $1million dollar apartment for sale. You get it under contract (tie it up). Then you bring the contract to the meeting and you shop the contract around with as many commercial realtors , real estate investors from the club, and contacts you've made. Selling the contract just 4% that means you make $40,000.00 And there's lots of very wealthy real estate investors who will buy the contracts off you. Especially companies and individuals that own many apartments. As long as they're getting a good deal, they'll give you your 4%.

Step Thirteen

So you start small and build. You just got to get that first deal done. After that it's basically a cake walk. And you have zero risk doing this. If for some reason you can't sell a contract then you'll get your deposit money (the $1000 you put up) back from the realtor. And the contract is now null and void. And the property simply goes back up for sale by the seller. And as you build up a database of contacts from networking at the real estate investment meetings and other investment meetings you find in your area it becomes easier and easier to flip properties. These contacts include: people from the club, realtors, commercial realtors, companies that both manage and or own apartment buildings, business owners, investors, and more.

This is one of the easiest ways to make money, with zero risk.
Go to the meetings and meet other investors. If you're still unsure about simply ask a more experienced real estate investor to help you to learn how to flip contracts. Often just buying one of them a cup of coffee is all it takes to find a mentor.
Start small and build until you can flip contracts on apartment buildings.
Find properties that can be divided up into more than one unit. For example, I know a fellow who will buy a house, and then put 3 small bedroom suites in the basement and rent them all out. So if you can show an investor that they could also do that, and show what the potential rents are for renting out the upstairs and then 3 more units downstairs it could all of a sudden make the property look like a great investment. You just got to have that potential for more than one unit and often the property will cash flow. (that means make the mortgage payment and still have cash left over)
Remember that the person buying the contract off you pays you the 4% and also the amount of your deposit. So in the example above it was $6000 + $1000 deposit for a total of $7000.
Never remove conditions unless you plan to actually buy the property and you have got a mortgage. If you remove conditions on the contract you stand to lose your deposit money (the $1000 you put up to get the accepted contract)
Always put "and or nominee" after where you write in your name on the contract. Any realtor or lawyer will be able to help you with this.
Realtors generally don't like people who are looking to flip contracts. So don't tell your realtor that you plan to flip the contract. It's none of their business. As far as they are concerned you're looking to buy the property. Same with the seller. Don't ever tell them that your intention is to flip the contract. Often if they know you're doing this they might not want to deal with you. This is totally legal and ethical, so don't worry about it. The person you sell the contract too ends up buying the property, everyone gets paid and everyone is happy in the end.
Never involve friends or family. Don't ask them to help you, and don't try to sell them the contracts. Just leave them out and you'll keep them as friends and family. Never ever do business with friends or family. Cuz if one thing goes wrong and it likely will you'll have damaged the relationship. So leave them out. Even if they ask you to deal with you, just say you value their friendship too much. Don't risk it.

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