Raising Private Money Vault Club REMINDER: Dial in to the conference call number on your Tonight’s Theme: webinar dashboard. Become a Money Magnet Tip: If on a land line, please turn OFF your cell phone or place it 10 feet away. Orientation House Rules: – Toggle *6 on your phone to mute / unmute OR – Type in your question on the panel. – Direct Client Care questions to the office: 713-476-0102 or TheVault@fcgllc.com Save your account questions for the office please. Agenda Announcement Theme Discussion Celebration Q&A & Deal Review Wrap-up Announcements New Member Instructions 1. Read your QuickStart Guide first. 2. Access your Private Money Rolodex. 3. You should be reviewing the weekly webinar videos on the Private Money Cookbook System!! 4. You should be doing the weekly assignments assigned on the videos and slides/notes. 5. Contact the office with questions. These resources are at www.RPMVault.com RPMVault.com Each week’s meeting registration is posted here. If you don’t receive an email, visit this site. If you have not received your log-in, contact the office. CONGRATULATIONS TO: Dan Badinghaus – Partners for Profit Student, Provided the Deal Daniel Yoo, Multi-Family and RPM Apprentice Student – Provided the Buyer Objective & Expectations Objective – Share and mastermind money resources – Share and mastermind deal structure – Vet the sources and share Expectation: – Your participation & contribution This session is not about finding deals but rather funding deals. Quote of the week…… "Life should NOT be a journey to the grave with the intention of arriving safely in an attractive and well preserved body, but rather to skid in sideways, body thoroughly used up, totally worn out and screaming "WOO HOO what a ride!" How does 'Conventional' financing differ from 'Private Money'? Conventional Permanent or bridge loans (amortizing or interest-only). Standard closing time frame is subject to due diligence factors (e.g., appraisal, environmental, engineering and other 3rd party reports, title, legal). However, some lending programs may take significantly longer to close (e.g., HUD). Higher leverage (i.e., LTV, LTC) and lower pricing. Funded typically by banks/institutions, insurance companies, pension funds, and government-sponsored programs (e.g., HUD, FNMA, Freddie Mac). How does 'Conventional' financing differ from 'Private Money'? Private Money AKA “Hard Money” Bridge loans (interest-only). Expedited closing time frame subject to due diligence factors (e.g., appraisal, environmental, engineering and other 3rd party reports, title, legal). Lower leverage (i.e., LTV, LTC) and higher pricing. Funded typically by wealthy individuals and private funds which are generally less regulated then conventional lenders. Private money is used for its funding speed which may be critical for certain deals (e.g., 1031 exchange). Although more expensive, private debt is usually cheaper than adding an equity partner. Private money is also used for deals which carry too much risk for conventional lenders, and may require real estate collateral other than the subject property. Theme Discussion: Become a Money Magnet! Predisposed – Someone who has already invested in Real Estate Previously Seller Broker Investor 1031Exchange Client Builder Don’t ever try to “sell” someone on the attributes of real estate investing when there are many already involved! Theme Discussion: Become a Money Magnet! Low Risk – Management Team Experience – Collateral Protection, %LTV – Extra Collateral Protection – 3rd Party Appraisal, Rehab Estimate, Repair – Cash-flow in Excess of Debt Service – Contingency Budgeted – Insurance Coverage – Title, Casualty, Flood, Liability, Key Man Life, Disability, Business Income Loss Insurance Theme Discussion: Become a Money Magnet! CONTROL – Financial Transparency, Review of Books – Receipts & Invoices – 3rd party Inspection of Work – Controlled Release of Funds – Key Man Disability, Life Insurance – Business Income Loss Insurance – 3rd Party Escrow of Purchase Money – 1st or 2nd or Blanket Lien Foreclosure Provisions – Ability to Intercede without Foreclosure Theme Discussion: Become a Money Magnet! High Return – In Todays Market, High Return is relative to current market and trends – One to two points over Prime Rate beats the current Money Market or CD. – Relative to Low Risk and Control, High Return may not need to be so High. – Madoff and other scandals have created “red flags” on traditional “High Returns”. – Investors are more cautious and willing to accept lower returns for lower risk and more control. Celebration Who had a breakthrough? Who accomplished a 1st? Who has a new money source? Who has vetted an existing money source Questions Questions? Aha Moments? Press *6 or enter through your Control Panel End of this Session Now, Go Raise Some Cash! See you next Week – April 13, 2010 Please answer the brief survey as you exit the webinar. Thank you in advance for your testimonial.