For those of you that think doing your first real estate deal seems easy for some, it’s not.
I’ve blogged for over 4 years, starting with my first real estate investment in Riverside, CA, right after I attended an Armando Montelongo Bus Tour. Everything turned out OK, we made a profit even though we overspent on some items. After seeing and meeting so many people that haven’t been able to get a deal, it gave me pause. I spent some time really thinking about that first deal, and I have to be honest, I’m amazed, surprised, and shocked that I actually did it. I went through with it, and I have to admit it wouldn’t have happened all by myself.
First, let me give you a little background, it’s important.
The Timeline
It was May of 2009 and my friend and I were commiserating on how broke we were. My retirement slashed for a Master’s degree that just brought me unemployment, and living on unemployment. I had received an invitation in the mail to attend some supposed star’s free event that would enlighten us to the path of wealth, true wealth.
I normally shy away from such hooks, because if it this was actually true, there would be a lot of wealthy people out there, right? My friend also said she wanted to go, yet when the time came, we were both exhausted and really didn’t want to go to the event. Peer pressure succumbed and we both used non-verbal manipulating strategies to make each other go to this free event.
Sure enough, we were fascinated with what we learned on this free event. Tax write-offs, assignment of beneficial interest in an insurance claim, land lording, etc. My husband owns duplexes and doesn’t really have to work due to that passive cash flow, so I knew they were correct on that front.
These guys were great at getting the audience excited. We were convinced we could be rich, that real estate was our path to wealth. Even when I hesitated to sign-up for a 3 day real estate training, my friend just nudged me and said something along the lines of “let’s do this!”.
Three thousand dollars plus a thousand dollar tax lien investing course later, we were on our path to wealth.
The Three Day Event
We were so excited to learn about real estate and the different strategies. I was ready to buy my first iPhone because I was convinced I WOULD be rich. That event itself had some really nice teachers and they displayed themselves as being very rich from real estate. I wonder now if that was actually true, but either way, they knew how to teach it.
This event had the real up-sell to a bus tour in California, where the profit potentials were incredible. The mantra was “sure you can make money here, but you can really make money at our secret location in California”. I bought it, hook, line, and sinker, until I saw the price.
We knew the bus tour was critical. Hands on with the experts, looking at properties, getting to know the markets and the opportunity AND learning from Armando (I figured out who he was by then).
The First Hesitation
I saw the price. I can’t remember exactly, but it was in the 5 figures to get a 1 year coaching, and only $6k more to go to the bus tour. Sticker shock stopped me, but my friend said, let’s do this, we’re going to be rich. We discussed the math, how to get our little piggy banks together and make it to that trip in California. I could just hear my husband in the background screaming about his bullshit radar going off. That was another issue, managing my husband and my commitment to learn how to achieve wealth.
We went on the bus tour and our eyes were totally opened. We were ready to make offers and get a property. In the mean time we got to know some other attendees that saw the same potential in California. This one guy, I’ll call Riley, had a proof of funds, and the availability of $400,000 to put towards the purchase of properties. The agents there knew how to smell money, and they gathered by Riley (I guess I could smell money too and gathered by Riley for extra motivation). We schedule a trip about 2 weeks later to look at properties, and make a lot of offers!
We Got an Offer Accepted!
When you go house shopping with someone that has more money than you have, it’s kind of hard to get your own deal. So all offers were made interchangeably with the agreement that we would both partner in the deal. The offer we got accepted was actually one that I made, yet it was my expectation that we would partner on this one property.
Then we got the news: YOU HAVE TO WAIVE THE INSPECTION PERIOD. Holy Sh**! My first deal and we have to waive the inspection. What did that mean? What if there is a real problem? I was totally stumped. Even though my agent assured me she could have an inspector out there before I actually sent in the deposit, I was still frozen stiff.
Riley, Mr. Moneybags, says, “Hey Jean, if you want to back out, I’ll take the project”. That snapped me back into reality. After all the money I spent on training, and to get a deal and have someone else show such calm and ease on such a risky project, I stood tall, and said, “OK, we’ll waive the inspection”.
Mr. Moneybags Backs Out
There is some comfort aligning yourself with someone that has more confidence than you have in a venture such as this, and that is what I did. So when Riley told me that he ended up with too many deals accepted and needed to back out of the Riverside deal, I felt like the rug was pulled out from under me. What? “We have to do this WITHOUT YOU?” GULP!
I never shared these turn of events in the beginning of my blog, mainly because I felt too exposed. All you knew from reading the beginning of the blog was that we got a deal. I’ve seen enough people, heard enough stories and am now able to see how and where I got pushed into doing this as a business. It was about 50% competitive me, and about 50% my surroundings.
And the Drama Begins
I will direct you to some of the posts, such as how this first deal was used to scam two elderly gentlemen out of $60,000 (scammer since incarcerated), all the stories that I wrote about with that first deal which was the first 4 months of the blog. If you’ve registered for the newsletter, then you have the ebook of the first 2.5 years of the blog. Look just to the right of this screen and register. The ebook comes to you for free.
To Be Continued…
I wanted to share this with you, because when I look back on how I was in this one critical period in my life, I have to acknowledge that it wasn’t just me that brought me to where I am today. I hear your fears, your frustrations, your issues, and I can tell you, I feel what you go through with each and every one of your real estate deals and I resonate with your stories. I wish you all the best of luck in any entrepreneurial endeavor you pursue!