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Part 4: Quick-Start Guide to Investing – Exit Strategies and Mastering Your Craft

Post It Note to Improve Skill

We’ve been outlining the 8 Steps you need to take as a beginner to get your real estate investing business off to the quickest start possible:

  1. Understanding Real Estate Cycles
  2. Identifying the Key Indicators in Your Market
  3. Building Your Power Team
  4. Making Offers
  5. Finding Financing Sources for Your Deals
  6. Implementing Finding Strategies
  7. Understanding Exit Strategies
  8. Constantly Learning and Mastering Your Craft

In this final installment, we’ll be looking at Steps 7 and 8.

Step 7 – Understanding Exit Strategies

To effectively get started in the investing business, you must understand exit strategies and how to use them to get into and out of deals profitably.

Every property that you encounter is a different situation. Each one has a different need, a different financing challenge and one or more appropriate exit strategies. The more exit strategies you know and master, the greater your chances of success as an investor!

For starters, make sure that you have a sound understanding of wholesaling, lease options, seller financing, rental properties, and rehabbing. These exit strategies will provide you with a solid foundation to be able to put together deals that are profitable for you and helpful for sellers. (Rich Dad Education’s Elite Training courses are designed to give you detailed instruction in each of these areas.)

Step 8 – Constantly Learning and Mastering Your Craft

Like most things in life, learning is a journey and not a destination. Truly savvy investors realize that they must remain in constant search of new ideas and information if they want to stay one step ahead of their competition.

Rich Dad Education offers classes, a Mentor Program, and personal coaching that are designed to help you realize your full potential as an investor and entrepreneur. We also encourage you to utilize many of the resources you have, from your local library to the Internet, to stay up-to-date on current market conditions and strategies.

As you continue on your path to financial freedom, get help as you need it.

By Mark Justice

Rich Dad® Education Elite Training Mentor


Acquisition Strategies and Exit Strategies: Why Both Are Important

Rich Dad Education Real Estate

I met a new Rich Dad Education student at a recent Symposium. He was from California and had enrolled in our Elite Training Program a few weeks earlier. He was excited to take his first training, the Foreclosure class; but he was even more excited to begin investing in real estate.

He told me that he wanted to “do a foreclosure deal.” I informed him that in the Foreclosure class, he would learn some great acquisition strategies. I then asked him what exit strategy he wanted to use on his first deal. He was puzzled by my question. He is not the first student I have met over the years who failed to initially think about both sides of the formula. You need both “acquisition strategies” and “exit strategies.” The more of both you have, the better equipped you will be to handle (and profit from) future transformations in your local real estate market.

There are a lot of great acquisition strategies. One way many newbies start is with simple marketing that declares, “I Buy Homes, Ca$h or Terms.”  When we buy with cash, whether it is our cash or OPM (other people’s money), we need a significant discount.  The Wholesale Elite Training covers cash strategies in great detail.  Terms purchases can involve a multitude of contract engineering techniques.  These strategies are covered in two different Elite Trainings: Lease Options and Creative Real Estate Financing.  What is neat about these three “cash and terms” trainings is they also teach valuable exit strategies.

With exit strategies, you convert your acquisition into cash, cash flow or a combination of cash and cash flow.  Investors who want the benefit of passive income from holding rental property will find great value by taking the Property Management & Cash Flow Elite Trainings.  Investors who want to convert their acquisition into immediate cash have two popular exit strategies: sell it wholesale or sell it retail.  Creating a combination of cash and cash flow can be a bit more complicated, but all the details are covered in the Lease Options and Creative Financing trainings mentioned above.  If you took one of these classes before this year, it may behoove you to retake it soon, since there have been some recent changes in federal law that affect seller financing transactions.

By Eric Buchanan

Rich Dad® Education Elite Training Mentor

The Key to More Profitable Deals

Real Estate

Finding Real Estate Deals

There is a key ingredient that is necessary for you to have more profitable deals as a real estate investor, and that key is probably something different than you think! While there are many things that you could do to increase your profit per transaction, there is one item that makes it happen for every investor…

It is all about the leads!

More leads will equal more deals and more money per transaction. The more leads you have, the more selective you can be about the deals you do and how much money you make per deal. Everything starts and ends with your lead flow.

So, how do you increase your lead flow? Well, let’s compare your real estate business to something else.

For the moment, imagine that your real estate business is a train. Trains are one of the most reliable methods of transportation. They always arrive at their destination. What makes them so reliable? Their reliability is due to the train tracks. The tracks are what helps them get from the starting point to the destination.

If you think of your real estate business as a train, the question you want to ask is:

What tracks are you laying down to get you to your destination? When you focus on laying down the right tracks or foundation for your business, it will inevitably take you to where you want to go. For the purposes of this article, creating systems that produce consistent leads is like laying down the tracks that will take your investing business where you want to go.

Most investors start off their business by finding deals on their own. They drive and look for vacant properties. They work with their real estate agent to locate potential deals. They call on for-sale-by-owner properties. They mostly rely on their own efforts to find deals. While these techniques do work and will produce deals, you will get more results from changing the focus so you start getting deals coming to you.

There are many advantages to getting leads coming to you:

  1. You can increase the amount of deals you do each year. When you turn up the volume of leads coming in, it becomes a numbers game. The more leads you have coming in, the more deals you will do.
  2. The quality of your transactions will improve. Usually the seller that contacts you will be more motivated to do a deal. After all, they were motivated enough to contact you to try and sell their property. Some of the most motivated sellers you will ever work with will be people that contact you.
  3. You get to pick and choose the best deals for yourself. Usually, brand new investors do any kind of deal because that is all they have access to. When you increase your leads and get deals coming to you, you get to pick the most profitable and lucrative ones and let the other ones go.

As you can see, there are a lot of compelling reasons to get deals coming to you. So, how do you do it? Well, there are many different ways to do it. It really doesn’t matter which strategies you use. It really has to do with your personal situation.

You may be in a situation where you have more money to spend on advertising than you have time to spend. Others may not have any money to commit to an advertising budget but they do have time to spend. Or, they might be able to spend both time and money to get leads coming to them.

Regardless what your situation is, there are solutions and ways to accomplish this. It just takes a concerted effort and discipline.

So you can create a plan, let’s review strategies to get deals coming in that require money and others that mostly just require time:

Methods That Require Time

  • Driving for dollars
  • Power team
  • Networking
  • Wholesalers
  • Expired listings
  • For-Sale-By-Owner marketing
  • Social media
  • Bird dogs
  • Door knocking
  • Letters of intent

Methods That Require Money

  • Magnetic signs
  • Newspaper ad
  • Website
  • Direct mail list
  • Business cards
  • Pay-per-click advertising
  • Radio/TV ads
  • Bandit signs
  • Door hangers
  • Postcards

As you can see, there are plenty of ways to get deals to come to you and there isn’t a wrong answer. You do not have to be great at all of them to get great results. Since this list may be a little overwhelming, the best thing to do is to select two to three strategies that make the most sense for your situation and start there. As needed, you can always change your strategy or add another method to reach the level of success you desire.

As you get further and further in your career as a real estate investor, you will want to get to a point where the majority of deals that are coming to you result from your marketing, networking, and your power team. You will want to leverage your time so that you are spending more of it structuring deals instead of finding them. Let your advertising and the efforts of others create the leads and spend your time putting the deals together. That is the highest and best use of your time.

Going back to the analogy we used at the beginning, these methods are like laying down the tracks for your train. The only way that you can get your train closer to your destination is to lay down the tracks that will take you there. Each and every track you lay down takes you inevitably closer to your destination.

What tracks can you start laying down right now? While these ideas and thoughts are fresh on your mind is the best time to start implementing them in your business. If you say you will do it later, later usually turns into never. Start laying your tracks today!

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