Volume 1 Final PDF

Real Estate
Investing
That Works
A Proven System
Volume 1
by Mike Gazzola
Real Estate
Investing
That Works
Copyright 2015 Mike Gazzola
Real Estate Investing That Works
All rights reserved. No part of this book may be reproduced
or transmitted in any form or by any means without written
permission from the author.
ISBN (978-0-9965299-0-7)
Printed in USA
Dedication
I dedicate this work to my loving partner and wife Melissa,
and my adorable children, Ashton and Kailey. Together they have
given me the inspiration and motivation to be a better man and
a good provider for my family. They are the reason WHY I am
compelled to share my real estate investing system with those who
are also on the path to making their dreams become reality.
Acknowledgements
Id like to thank KS Real Properties for their commitment to
publish my book even when it turned out to be two volumes.
I am grateful for the support and guidance of Ken Meares,
Dr. Sharon McQuillan, and Miles Dupree for recognizing that
I have a story to tell that can change the lives of many people
seeking financial independence. All of this would not be possible
without the tireless effort and assistance of Frank Marchese,
Chris Lagowski, Elizabeth Gubala, Brent Kinney, Lizett Acosta,
Gabriel Camarda, and Blade Thomas. And finally, I owe a special
debt of gratitude to my mom, Sharron Kinney, who never told me
it couldnt be done.
iv
Volume 1
Table of Contents
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi
Chapter 1 Getting Started . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Chapter 2 What Is Your WHY . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Chapter 3 Investing Is Key . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Chapter 4 Starting with Less than $10,000 . . . . . . . . . . . . . . . . 17
Chapter 5 The Current Housing Market . . . . . . . . . . . . . . . . . . 33
Chapter 6 The Biggest Secret: Buy below Market Value . . . . . . 39
Chapter 7 Where to Find Investment Properties . . . . . . . . . . . . 49
Chapter 8 Properties for Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Chapter 9 Running Ads to Purchase Properties . . . . . . . . . . . . 79
Chapter 10 How to Buy and Sell Homes and
Land Remotely . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Chapter 11 How to Maximize the Use of Realtors . . . . . . . . . 119
Chapter 12 How to Open and Fund Your Bidder
Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139
v

Chapter 13 What Happens after You Win a Property
at Auction? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151
Chapter 14 Researching Auction Property From
The Foreclosure List . . . . . . . . . . . . . . . . . . . . . . . 159
Chapter 15 Back Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
Chapter 16 Mapping Your Route . . . . . . . . . . . . . . . . . . . . . . . 177
Chapter 17 Exterior Property Inspections . . . . . . . . . . . . . . . . 183
Chapter 18 Interior Property Inspections . . . . . . . . . . . . . . . . 189
vi
Volume 2
Table of Contents
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii
Chapter 19 How to Determine Property Value . . . . . . . . . . . . . . 1
Chapter 20 How Far in Advance Should
You Research Properties? . . . . . . . . . . . . . . . . . . . . 19
Chapter 21 Bidding through Proxy . . . . . . . . . . . . . . . . . . . . . . 31
Chapter 22 Live Auction Techniques . . . . . . . . . . . . . . . . . . . . . 43
Chapter 23 How Much Money Should You Keep
in Your Bid Account? . . . . . . . . . . . . . . . . . . . . . . . 55
Chapter 24 Turnaround Time after Bidding . . . . . . . . . . . . . . . 59
Chapter 25 Determining the Extent of a Remodel . . . . . . . . . . 65
Chapter 26 Buy and Hold vs. Flip . . . . . . . . . . . . . . . . . . . . . . . 71
Chapter 27 Generating Rental Income . . . . . . . . . . . . . . . . . . . 79
Chapter 28 Who Else Wants to be a Landlord? . . . . . . . . . . . . . 85
Chapter 29 Finding a Local Property Manager . . . . . . . . . . . . 95
Chapter 30 Finding a Contractor . . . . . . . . . . . . . . . . . . . . . . . 105
vii
Chapter 31 Online Selling Strategies . . . . . . . . . . . . . . . . . . . . 115

Chapter 32 Selling Techniques . . . . . . . . . . . . . . . . . . . . . . . . . 131
Chapter 33 H
ow I Started an Online
Real Estate Business . . . . . . . . . . . . . . . . . . . . . . . 157
Chapter 34 eBay Strategies for Selling
Properties Online . . . . . . . . . . . . . . . . . . . . . . . . . . 167
Chapter 35 Tax Free Real Estate Investing . . . . . . . . . . . . . . . 173
Chapter 36 Health Savings Account (HSA) . . . . . . . . . . . . . . 185
Chapter 37 Jump In! . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193
viii
Foreword
Mike delivers a combination of common sense and technology that empowers you to find out everything you need to know
to buy and sell real estate online below market value. This is
amazing!
Kerry Lutz
Financial Survival Network
As a retired attorney, I first learned about Mike Gazzola while
doing research for a worldwide radio podcast about real estate
investing.
I was so curious about Mike that I did a little research to find
out if he really has bought and sold hundreds of properties in the
past 12 years. What I discovered was even more shocking. When
Mike says hundreds of properties in the past 12 years, hes just
talking about the properties hes purchased and sold on his own.
What I also discovered is that hes probably been involved with
hundreds of more property transactions that involve joint ventures and partnerships with his friends, students, and other real
estate investors.
This young man is clearly on the cutting edge of what I consider to be the future direction of a worldwide real estate investing
marketplace explosion.
ix

Mikes system utilizes the simplest and most advanced Internet technology to actually use your personal computer or smart
phone to buy and sell real estate without ever leaving the comfort
of your home or office.
What Ive learned from Mike is that this is not only becoming a
viable method of property transactions, but it is also an almost foolproof method for finding properties that are not even listed on the
Multiple Listing Service. And then he takes it a step further by being
able to selectively purchase these properties way below market value.
Mike has also demonstrated that it does not take a lot of money to
get started in real estate investing. He clearly illustrates how anyone
can get started with as little as $10,000. But the reality of that promise is that he has again made an understated claim. Thats because
Mike shows you how to get started with as little as $2,000, but he
firmly believes youd be more likely to succeed with a slightly bigger
capital investment or start off small and build up your nest egg.
In fact, I just purchased my first property using Mikes system.
I bought a condo in West Palm Beach for $52,000 with a market
value of approximately $105,000. I need to put about $12,000 into
repairs, but this still leaves me with a profit margin of $20,000 to
$30,000, and I can still resell it under market value.
The fact that you have these materials in your hands right now
tells me that you are on the path to creating wealth for yourself
and perhaps a legacy of financial security for your future and for
generations of your family to come.
Phone: 800-999-2274
Kerry Lutzs Financial Survival Network
E-mail: khl@kerrylutz.com
x
Preface
The information you are about to read

has taken the better part of my adult life
to learn, prove, and develop into a viable
system thats easy to follow so you can
gain personal wealth through the process
of real estate investing.
There is no theory or conjecture presented within these pages and on my
DVDs. Everything comes from actual
hands-on experience. The examples and concepts I present come
from working in the trenches of buying and selling hundreds of
real properties at live and online real estate auctions.
Ive also worked with realtors and other investors who have unknowingly taught me many of the details you are about to learn.
Please be clear, I love realtors and I believe they perform a valuable
service when it comes to buying and selling properties. However,
I have also discovered that with the Internet and todays amazing
technology, it is now possible for individuals to reach far beyond
what the local real estate agent and broker can provide to the active
real estate investor.
During the past five years, I have been teaching adult students
my system, and they have constantly asked me to put it down on
xi

paper and video so others can learn and do the techniques and
strategies that have allowed me to achieve financial independence,
not just for me, but also for my family and hopefully for my childrens families in the future.
Once a student learns my system, we become peers, and I do my
best to constantly keep them abreast of exactly whats going on in
the world of real estate investing.
I truly believe in what I do, and I know that my success has
come not just from hard work, but also from allowing people to
maintain their dignity, always telling the truth, and being honest
in all my business associations and transactions.
Ive also been very lucky and truly blessed.
Thank you for trusting me enough to spend your time and
money learning this valuable system of techniques, strategies, and
all the personal insights Ive learned over the years. It is a true
honor to be able to share this amazing information with you.
All the best,
Mike Gazzola
Real Estate Investor & Mentor
xii
Introduction
What you are about to discover is new and amazing. If you have
any interest in how to make money in real estate, you are in the
right place.
Every so often, someone has a major transformative breakthrough in how the world works. The introduction of the Internet
more than 20 years ago has transformed just about every aspect
of our lives; from entertainment and travel, to health, nutrition,
education, and now, real estate investing.
When it comes to buying and selling real estate, the Internet has
made it possible for us to research and find everything we need to
know to make a good buying decision on single-family homes,
multi-family units, and raw land.
My name is Mike Gazzola. I am a successful in the trenches
real estate investor who enjoys teaching the amazing system
that has helped me build phenomenal personal wealth.
Its no secret that real estate investing has made more people
rich than any other commodity on earth.
Some people get wealthy investing in the stock market. Others
do it through oil and gas. Some even find their fortunes investing
in precious metals, gems, cattle, and grains. Some make it by winning the lottery while others chase after currency fluctuations in
the FOREX market.
xiii
The Real Estate Market Is Slowly Coming Back!

We are now in the post real estate crash phase and the market is
starting to make a strong, slow comeback.
This is the ideal time to get into real estate. All the options are
open:
You can flip for profit
You can create a steady monthly income
My biggest real estate secret is not based on an up economy, a
down economy, or a sideways economy.
It truly doesnt matter what our economy is doing. It doesnt
matter whats going on in the world or what world events are
happening.
What matters is acquiring the property so far under market
value that the chance of losing goes way down and the chance of
making money goes way up.
Creating Instant Equity

This is the best way to take the risk out of real estate investing
because when you buy below market value, you are creating instant equity. This is my biggest secret.
This is what I have done over the past decade and this is exactly
what my system teaches you to do.
Youll learn, step-by-step how to:
xiv
Introduction
Find the hottest markets.
How to wholesale your properties quickly without
remodeling them.
How to generate a monthly continuity income.
How to reduce the amounts paid to 3rd parties on all
your Real Estate deals.
How to find the best properties way below market value.
How to fix them up using local contractors if you choose
to remodel them.
How to find property managers that wont rip you off.
How to sell your properties quickly at a nice profit to a
worldwide audience of buyers.
It All Happened by Accident

Twelve years ago I discovered my future fortunes were in real
estate.
I am a big New York Giants football fan. While at work I was
taking a few minutes of personal time at my computer looking for
NY Giants collectibles on eBay.
By accident, I searched something New York related and up
came a listing for a rented duplex in Buffalo, NY, for just $25,000.
This seemed amazing to me.
xv

I was living in San Jose, California, and even a simple 2-bedroom, 1-bath condo was selling for almost $300,000. So, I decided
to look further.
I called the guys selling the property and talked with him for
about an hour. He answered all my questions. I could also hear
his kids and dog playing in the background. He seemed like a
legitimate family man.
The part of the deal that immediately closed me was that this
duplex was occupied and bringing in $1,100 a month in rent, and
I could buy it for only $25,000.
I thought, How can I lose? In two years I could get all of my
investment back and still own the property with a positive cash
flow. So I made a decision and took the risk.
I bought the property and sent him a wire transfer for $25,000.
He sent me the deed to the duplex within a few days.
It all seemed great. But I knew I could really get ahead if I resold that property for a nice profit I was living in San Jose? So, I
got another idea. I ran a small ad in my local newspaper that said:
Rented Duplex For Sale $50,000

The day the ad ran I got several calls, but there was an older
woman wanting to know if I was for real and if the property was
really just $50,000 and if it already had tenants.
I faxed her copies of their rent checks and their leases. She was
very focused so I said, If you are sincerely interested, Ill knock
xvi
Introduction
the price down to $45,000, and its yours. If not, Ill continue taking calls from other interested investors.
She said she wanted it and she came to my office in San Jose,
CA and bought it right then for $45,000. She brought me a cashiers check for the full amount.
I made $20,000 in a few weeks with a few hours of work and I
was shocked! I never made so much money so fast in my life!
I went back to the guy who sold me the duplex in Buffalo and
asked him if he had any more properties for sale. He said he did,
so I hopped on a plane and flew to Buffalo to see the properties
and meet the man.
I then bought and sold three more in in a short amount of time.
It was amazing. I was buying and selling properties in Buffalo,
NY, and making really nice profits from my office in San Jose.
This seemed like an absolute miracle! I asked the man if he had
any more properties and he said, Yes. I have 42 more properties. Since I was so good at selling the properties, I asked him if
he wanted to partner up and work together. He said, No, not
really.
I was persistent and I pointed out to him that I had sold four of
his properties very quickly, and I could help him sell the rest of his
properties. He finally said, Yes, under one condition.
You Have to Move to Buffalo!

So I said, OK, what? He said, You have to move to Buffalo.
xvii

That was it for me. I discussed it with my future wife and my
family and they all thought I was crazy. I told them I was quitting my job and moving to Buffalo, NY.
It took nine months to sell 42 of his homes. During that time
he showed me how to find the homes, how to buy them, fix them
up, and rent them. It was an invaluable experience that paved the
way for me to generate millions of dollars buying and selling investment real estate.
I Found the Sweet Spot!

When it comes to real estate investing, I am generally not talking
about homes you want to live in. I am focused on homes and land
available for as little as $100 and as much as $100,000. Ive found
this price range is the sweet spot in todays marketplace.
Im talking about buying homes with no mortgage, no escrow,
no appraisal, and usually even without a realtor.
How Is This Possible?

Believe it or not, you can buy parcels of land (residential lots) in
neighborhood communities for as little as $100. Of course those
deals are unusual, but they do become available quite frequently
because theres no one bidding when they go to auction.
The catch is that you must pay cash and you must have the winning bid. You need to be prepared to pay 520% at the auction
(live or online), and then you must pay the balance due within 24
hours, or up to a month depending on the auction.
xviii
Introduction
In fact, just last month I personally bought a residential lot for
$100 simply because no one else was bidding. At the end of the
bidding, before the property went back to the county, I placed the
minimum bid of $100 and won the property.
Take for example, a young college graduate by the name of Dave
Stall. As a teenager, he used to mow my lawn. Through our friendship, I taught him how to buy property at tax auctions. Dave went
with me to a local auction and bought a lot for $500. Later, he
sold his lot for $2,000, making a 400% return on his investment.
Does this happen all the time? No, but it does happen more
times than you would think. Just last week I ran into one of my
other students John from Beverly Hills and he told me how he
bought 2 lots next door to each other for $500 each and just last
week he sold them together for $5,000.
Properties with No Owners

When you learn how to use my real estate investing system you
will be discovering inside information and techniques about how
to find properties owned by the county, state, federal government,
or banks that need to be liquidated.
These properties are not necessarily distressed, but they are orphaned and prime candidates to be picked up at auctions way
below market value.
How to Be a Property Detective!

My system teaches you how to be a Property Detective.
This skill allows you to do quick research and within a matter of
xix

minutes youll know if the property youre interested in is a hot
deal or something you dont want to go near.
With my system there has never been a single auction property
Ive purchased that I havent been able to sell for a profit.
Most people dont know about these properties because you
will not find them listed on the Multiple Listing Service which is
the traditional inventory source to buy and sell homes and land.
Not a Get-Rich-Quick Scheme!

This is not a Get-Rich-Quick system of real estate investing.
It is, however, a carefully thought-out plan that guides you stepby-step on how to find and buy properties so far below market
value that you have the moneymaking option to do one of three
things:
1. Buy and sell immediately for a profit (quick flip).
2. Remodel and sell for even higher profits.
3. Hold and rent for monthly income.
This is the opportunity youve been waiting for, and this

is the system to help you gain personal financial freedom!
Fasten your seat belt as we embark on an amazing journey that has the power to transform every aspect of your
personal, financial, business, and family life. Welcome
aboard!
xx
CHAPTER 1
Getting Started
Congratulations! Youve just begun a very exciting journey that
will take you from where you are now and transform you into a
successful real estate investor! This is your opportunity to create
instant equity when you purchase land, homes, duplexes, triplexes,
or 4-plexes.
You are about to discover how to buy real estate for pennies
on the dollar (far below market value) and how to sell it quickly
online to a worldwide market.
Used properly, this information is valuable because youll not
only discover how to make more money, but you will also learn
how to be your own boss, and create a better financial future for
yourself and your family. These are life-changing results!
I promise this book will show you exactly how to do that and
more.
How can I be so sure? The reason I can be so sure is that Ive
already done it for myself. Like many of you, I came from a very
modest background. But Ive become a self-taught master in real
estate. In fact, Ive already done hundreds of real estate transactions in the past 12 years.

I am proud to say that after 12 years in the business, I have never
lost money on any of the hundreds of auction properties I have sold.
Thats not to say that Ive never made any mistakes. Ive made
plenty of mistakes. But Ive learned from my mistakes, and what
you are reading now is a carefully designed system that will show
you how to create instant equity in your property purchases and
reduce the risk associated with investing in real estate.
I know this because I have not only done this for myself, but I
have also taught thousands of students just like you to do what I do
using my step-by-step system. Im 100% ready to teach you exactly
what you need to know to potentially make great personal income,
build your retirement savings tax free, and even set aside money for
your childrens college education, tax free or tax deferred.
With the right training, Its not hard. Its not
complicated. Most important
Dont worry if you currently do not

Know Anything about Real Estate
In fact, because of all the misinformation out there about real
estate investing, its actually better if you dont know anything.
For example, Ive found no-money-down deals are rarely good
investments? The main reason is that when buying property for
no money down, you usually have to pay up to 30% more. Its
true. Its easy to acquire property when you are willing to pay 30%
above current market value.
Whether you know nothing, a little, or a lot about real estate,
this book will benefit you tremendously. I have developed a unique
system that is virtually guaranteed to work. Its goof-proof.
2
Getting Started
Ill show you how you could make money whether the market
is up or down. Ill show you how to be a step ahead (by creating
instant equity) the moment you make a purchase. Ill show you
how to flip fast for big returns, or create monthly cash for life as a
landlord. You dont need to know anything now because Ill teach
you exactly how I do it and you will learn my same techniques,
strategies, and inside secrets to investing in real estate.
What Do You Need besides My

DVDs and This Book?
Desire. You need a desire to make more money and to live
a better life.
Willingness to learn. Successful people approach learning
with a totally open mind and genuine curiosity.
If you bring desire and are ready to learn, you WILL be successful. I can almost guarantee it.
How Will You Get the Most out of Reading This Book?
It starts by creating a powerful relationship with what youre
reading. This isnt just another book. These arent just more words
on paper. Im sharing with you over 12 years and hundreds of
transactions worth of secrets and street-smart real estate wisdom.
People have paid me well over $15,000 for the information in
this book & the DVDs, and I have never had a single student complete my course and ask for a refund.
Here is a suggestion. Pretend you wrote me a check for $15,000
and hired me to sit next to you and deliver this information in
3

person. I guarantee if you did, your eyes and ears would be wide
open. You wouldnt have the TV playing in the background. This
wouldnt be a passing hobby for you. You would be focused and
determined to get your moneys worth out of everything I show
and teach you.
If you spent $15,000 for this information, you would clear your
schedule to get everything possible out of what I have to say. My
students constantly tell me the information in this book and on my
DVDs is easily worth TEN TIMES $15,000. No matter what you
paid for it, keep in mind the benefits of what youre about to learn
have been proven to be extremely valuable. This is a proven system.
A few tips on getting started:

Dont just read. Do what I call focused-reading.
Consciously take a moment to clear your head and the
distractions around you. Then read. Dont just skim the
pages. Read like your life depends on it. If you want to be
extremely wealthy, your financial life depends on how well
you learn what I am about to teach you.
Dont tell anyone about your desire to become wealthy
in real estate. Keep it to yourself for a while. There are
simply too many naysayers out there. Many times Ive
seen one negative comment kill the desire and inspiration
it takes to truly achieve something remarkable.
Get excited about reading this book. Get really excited.
Imagine the feeling of making more money in one month
than most people make in a year. Imagine having true
Getting Started
financial security and not having to stress over where your
next dollar is coming from.
Nothing great was ever achieved without enthusiasm.

Ralph Waldo Emerson
Get pumped! Youre on your way to learning a specific set of
skills that will result in you being able to buy and sell properties
on your own, without being a real estate agent or broker. Theres
no exam to pass and no license to acquire. Everything you need is
right here in this guidebook and the accompanying set of DVDs!
CHAPTER 1 Summary:
You have made a wise decision and you are smart
enough to realize this is a great pathway to financial
independence and success.
You dont need to know anything about real estate to be
successful. In fact, sometimes its better if you dont.
Pretend I am there with you right now telling you this
information and you paid me $15,000 for it. Dont just
read the words. Focus-read. And dont just skim read
to really get the information embedded in your brain and
you will be rewarded with great information.
Be enthusiastic! Making money investing in real estate is
fun and exciting!
C A S E H I S TO R Y
53 Hawley, Buffalo, NY Bought for $25,000
Sold for $45,000 a $20,000 profit without having
to put any work into it.
This was the first property I ever purchased. Its an old red
brick home, originally built in 1870, 2,200 sq. ft., 6 bedrooms,
3 bathrooms, and a guest house in the back. It was listed as a
duplex with two tenants bringing in $1,100 per month. I bought
it for $25,000 cash and resold it for $45,000 cash to a lady in
San Jose. I ran a small ad in the local newspaper and got an
instant response.
What I like about Buffalo is that it is the home of many great
Universities. It always has great demand for students & staff
rental properties.
People in California simply couldnt imagine getting any type
of real estate for $45,000, so you can see why I sold it for such
a nice profit. This was the property that started it all for me. It
inspired me to buy three more properties and sell them almost
immediately nearly doubling my money. The only real work I had
to do on this property was find a buyer and using one of my
techniques selling it pretty easily. This was the transaction that
got me hooked!
6
CHAPTER 2
What Is Your WHY?

Before we dig into the details of my system, I want to share a
quick secret about personal motivation.
Ive found that in order to be really successful in life, its impor
tant to know your WHY? What I mean is, Why do you want to
be successful investing in real estate?
The quick answer for many people will be to make more money
and that is a good start. Or, perhaps you simply want to work
for yourself, make your own hours, or work from home.
Ive found it useful to go deeper and get to the real WHY.
For me, its my family; my wife and kids. They are my WHY. I
want them to have the most amazing life possible and for them to
never need to worry about money. The reason I work every day,
the reason I am always looking to make a new great real estate
deal is for my family. That is incredibly motivating for me because
I love them very much.
What is your WHY? It could also be your family. That is an
awesome WHY. Do you have a sick parent? Are you nearing retirement? Do you have kids that are getting ready to go to college?
If you dont have a WHY, youre never going to make this work
because we all need that motivation to be our driving force and
our reason to never give up.
7

You need to really sit back and ask yourself, Why do I want to do
this? Why do I need to make a lot of money? What is extra money
going to do for me? Why is it absolutely imperative that I succeed?
The answers to these questions will keep you motivated and
give you the best reasons you need not to give up when you get
tired, bored, or decide to jump to something else.
Once you know your WHY, then you can always come back
to it. If you get a little down or youre thinking, Gosh, Ive been
studying Mikes system for three weeks, been to a few online auctions, and I just havent scored a deal yet. Take a moment and
bring yourself back to your WHY and understand that as long
as you know whats driving you, its easy to re-focus and get re-inspired and press on towards your goals.
Take a moment right now, and write down your WHY. A good
place to start is to ask yourself, What means the most to you in
life? Who do you love the most?
Wanting to make more money is good, but WHY? Is it so you
can live in a nicer home you are proud of ? Drive a nicer car? Have
enough money to retire and live comfortably?
Here are a few examples of WHY that may help you discover
what your real WHY is for wanting to learn how to make money
investing in real estate.
I want to never have to worry about money for myself or
my family.
I want the independence, freedom, satisfaction, and
fulfillment of being able to earn large sums of money on
demand.
8
What Is Your WHY?

I want to do something I can be proud of that provides
financial security and stability to live my dreams.
I want the ability to be able to quit my job or reduce my
hours so I can spend more time with my family.
Now its your turn. Grab a piece of paper, or turn on your computer, and open up a Word file and title it: MY WHY. Get detailed. For example, with me, its not just about my kids. Its that
I want my children to go to the best colleges in the country. Take
the time to look at what you are most passionate about; what you
are the most emotional about.
Once you have it written down, and it really excites you, you
are ready to open the doors to real estate investing success
and youll be super motivated because when it comes to making big money in real estate youll now know WHY you are
doing it!
CHAPTER 2 Summary:
Know your WHY. Articulate it clearly with passion and
emotion. Make sure it excites you and that it is a strong
enough reason to keep you committed and focused on
learning what I am teaching you, even when you dont
want to.
If you are ever struggling or need more motivation, go
back to your WHY! It will keep you going when you get
lazy or want to quit and give up.
STUDENT TESTIMONIAL
Ive Been a Real Estate Broker for 15 Years & Never
Knew This Was Possible!
I specialize in the REO industry selling foreclosures for

places like HUD, Freddie Mac, Fannie Mae, all the banks,
and GSE, asset management companies.
Mike has opened me up to things I never knew existed,
and showed me where I can find deals I dont even have
access to.
What I learned from Mike is how to purchase properties
through tax sale auctions and foreclosure auctions online
all across the country before they go on the market
anywhere else!
Mike taught me things Ive never heard before. Whats
different from Mikes program and all the others is that it
really works. This is going to help me build generational
wealth for my family.
Bill, Real Estate Broker with Americas #1 Top Selling Team
10
CHAPTER 3
Investing Is Key
Websters dictionary defines INVESTING as the act or process
of expending resources, especially money, to achieve rewards.
Although I am not the CEO of a huge multi-billion dollar international corporation with thousands of employees, I see every
dollar I have as a single employee working 24/7 for me.
If I want to invest my employees (dollars) in a property, like a
duplex, I know that to get that duplex I have to send my employees out to acquire the property. In my first purchase, I sent 25,000
employees (dollars) out to the field, and they came back with a
fully rented duplex in Buffalo, New York, generating $1,100 per
month in income. Two weeks later I sold that same duplex for
$45,000. My 25,000 employees returned as 45,000 employees.
I then sent those 45,000 employees out to get three more properties, and they came back a few months later as 115,000 employees. What I discovered about investing was that for me to make
more money, I had to send my money out and have it work for
me. Thats exactly what I am going to teach you; how to put your
money to work so it comes back with a conquest of, you guessed
it, more money.
I didnt go out and buy a new car or take an expensive vacation.
Thats called spending your money with no possible return of more
11

employees (dollars). Theres a big difference between spending
and investing.
Putting your money to work is how you build your bankroll.
This is how you can consistently increase your capital by investing. Within a year, I bought and sold over 42 properties with my
partners and my $25,000 investment quickly became hundreds
of thousands of dollars. It didnt happen overnight, and it didnt
happen with one single property.
A few of the properties had a modest return of a couple of
thousand dollars. Others did better bringing back $10,000 to
$20,000. The big surprise was that several brought back $30,000
to $40,000.
The Best Way You Can Succeed in Real Estate

Investing Is to Have Your Money Working for You.
It doesnt matter if you have a few hundred dollars, a few thousand dollars, or if you have millions of dollars. Develop a mindset
that each dollar is your own personal employee. I dont want my
employees just sitting in the break room locked away and doing
nothing. No. I want my employees on the move acquiring and
bringing back more employees and assets. I want every dollar I
can spare bringing back even more dollars.
If I just leave my employees in a bank account, savings account,
or CD, with todays minimal interest rates, my employees are stagnant, accomplishing very little. That is like willingly sending all of
your employees on vacation. They are out doing nothing productive when they should be totally focused on bringing back more
money.
12
Investing Is Key
Think of your money as your team of top notch executive employees. Its not a resource you have to hoard and sit on. Its not
a resource you should be scared to part with. For me, that is the
worst financial decision I can make.
Wouldnt you rather unleash those employees and harness the
power of those employees to get you more employees so you can
build your empire? Thats how you build momentum and become
unstoppable.
You could, of course, put your employees to work in the stock
market. Even if you invest in a big blue-chip stock, it could easily
go belly-up. Look at Enron and all the financial stocks that were
crushed in 2008. If a stock goes belly-up, all you have left is paper,
or at best, a fraction of what you started with. When you buy a
stock, you really dont have any control over what happens to your
money.
I want to be in control of how my employees are working. I
want a certain guarantee they will return successfully with even
more employees. That is why real estate makes so much sense. Unlike a stock, no matter what happens, you still own the property.
Its tangible. Its real thats why its called Real Estate.
Last time I checked, they are not making any more land. More
people are being born every year. The number of people looking for
a place to live is constantly increasing, but they are not making more
land. That is why the value of real estate will almost always go up.
As youll soon discover with my system, youll potentially make
money the second you purchase a piece of property whether the
market goes up or down. Thats because I show you exactly how
to buy properties that arent listed in the Multiple Listing Service
13

for pennies on the dollar. When you make your purchase, youll
have what I call, Instant Equity.
The bottom line is: you need to get your money, your employees
working for you. There is no better place for those employees to
make more money than in real estate. My system is designed to
get your personal employees working for you!
Its All about Your Mindset

Some people are satisfied with one deal. They do one good deal
and they think theyre set, they met their goal and everything is
good. But thats crazy. Once you make that first fat profit and you
just spend it, the next thing you know, all your investment money
is gone.
What If You Took Those Funds and Reinvested?

What if instead of caving in to instant gratification Oh, I
made this money, let me go buy a new car, you invested it. I
suggest that you do it a couple times and then go buy yourself a
new car, so you can leave your investment employees in the field
working for you to acquire more employees and assets. Never take
your small supply of employees and send them to a new car lot
and stick them all in a new car. Thats not the right thing to do
with those loyal, dedicated 24/7 employees.
Put them into a new car, and youll have no employees working
for you. How are you going to grow your business and build it into
an empire with no employees? If you are reading this guidebook
to make money, understand you must get your employees tirelessly working for you.
14
Investing Is Key
CHAPTER 3 Summary:
Consider every dollar you have to be a dedicated, loyal
employee working for you 24/7.
Leaving your employees sitting around with nothing to
do is a total waste!
Real Estate is one of the most proven and profitable
places to send your employees to make money for you!
Dont stop at your first deal. Keep having your employees
make more money for you.
Dont blow your profits on instant gratification until
your bankroll is big enough not to be handicapped by
unnecessary expenditures that have no potential of
bringing back more money.
15
63 Edison: Bought for $17,000 Sold 4 months later
for $59,000 Made a $42,000 Gross Profit
This property is a very typical transaction for me. I bought

this through a foreclosure and sold it online to an out-of-state
investor. Located in a university town, its always easy to rent.
Its a duplex built in 1935, two 3-bedroom units with a large
garage in the back. The purchase also included the lot next
door, making it a really large lot for a city property. It also has
an attic and a basement. It was in fairly good shape, only
needing minor repairs consisting of paint, flooring, and a few
cosmetic upgrades.
After purchasing it for $17,000, I put a few thousand dollars
into it and sold it 4 months later for $59,000 with a gross profit
of $42,000.
16
CHAPTER 4
Starting with Less

than $10,000
In this chapter I will share how you can get started with under
$10,000. I understand that not everyone has $50,000 or $60,000 sitting around to use for investing. We all need to start where we are.
I will share how you can start with a lot less and work your way up.
Before you invest a penny, it is very important to get clear

on a few things:
What is your WHY?
Why are you doing this?
What is your end game?
Are you looking to generate income?
Are you looking to flip houses quickly?
Do you want continuity income each month?
I cant tell you what your needs are or what your goals are, but
I can give you the successful tools I use myself.
If you want to start purchasing properties at under $10,000, we
can agree that your options will be somewhat limited. But, Im
17

here to tell you there are properties out there you can get for under
$10,000.
There Are Tons of Them!

Ive bought many and flipped them for as much as $40,000,
$50,000, or even $60,000.
Lets get specific because you need to know how to get started
with the amount of money you have. Its great to see a mentor do
it, or other people doing it, but the bottom line is you want to do
it. Thats whats important.
How Can You Do It?

If youre starting with $10,000, I wouldnt recommend tying up
all $10,000 at once. Youll want to tie up only a piece of your
bankroll with one property and leave enough to possibly buy another property. If you can do this, I recommend doing it twice.
I am going to share what I would do, and youll make your own
decision based on what I share with you.
If I had to start today with $10,000 and everything else disappeared, I personally would jump right into purchasing land.
I would get the cheapest pieces of land out there, right now
today as I write this book lots sold at auction for under $2,000. I
would buy whatever I could find. I would want it to happen fast
because I know time is of the essence.
I would start by attending a tax deed auction.
These happen all across America, some online counties conduct them on Tuesdays.
18
Starting with Less than $10,000

Just because you attend a tax deed auction doesnt mean youre
going to win one, but you can at least participate and understand
this is a numbers game if you trying to find the best deals out there.
Why Consider Investing in Land?

Lets talk about investing in land. If you are just beginning and
want to start off small, its important to build your limited bankroll incrementally so you can strategically buy even bigger and
better properties.
Youll see many deals out there for land available at a fraction
of their previous value. Land can be a great opportunity because
when construction is not booming like now most people are
turned off by land.
When people are turned off by land the prices go down because
theres much less competition to purchase land. Investing in land
could be a great opportunity for you, especially if you have under
$10,000 working capital.
When people are uninterested in buying land, as odd as it may
seem, its a good time to buy. Land prices are a fraction of what
they were 10 years ago. In fact, many vacant lot prices are now
210% of their peak value. To make a nice profit you dont need
prices to go back to 100% of their previous value. You can easily
double, triple, or even quadruple your money with small increases
of 2030% of their previous value. Thats the sweet spot to look
for when buying land.
Properly purchased land right now is a conservative investment.
Heres why:
19

During the real estate boom that ended around 0607, there
was incredible speculation. Builders and investors came and
bought up all the land and started developing enormous housing
communities. Everybody wanted a piece of those areas and then
the crash came. This typically happens in an area where youre
going to find great land deals. Thats because the lot prices got so
high in value, and people leveraged these properties so much, that
ultimately they were foreclosed on.
For example, people would borrow $100,000 on a piece of dirt.
When the crash came that piece of dirt was then worth $10,000
retail. When that happened, nobody even wanted to buy those
lots for $10,000 retail (because everybody was scared). However,
the bank was still owed $100,000 on the lot. When the crash first
came, we noticed a lot of land freed up right away, because people
walk away from land a lot easier than they walk away from houses.
Imagine you own a piece of land with an $800 per month mortgage that was purchased based on speculation. Your goal was to
build on that land, but now all of a sudden theres a crash.
Youre most likely not going to continue to pay that note if you
have no plan. Lets say the property is worth $10,000 retail, but
you owe $100,000.
People at property auctions arent interested in that piece of
land because they say, Oh, I can get a house or a multifamily
property for a deal right now. But understand we all start somewhere; if land has to be your start, imagine buying that same lot
with a $10,000 retail value for $4,000-$5,000.
Risk vs. Calculated Risk

20

If you use the excuse, I only have a couple thousand dollars.
Theres no way I can invest in real estate. Most people would tell
you, Take that tiny amount of money, use that as a down payment, and borrow the rest. In my opinion, thats super risky.
If you put up a very small down payment lets say 10% and
all of a sudden the market goes down, your property is now worth
less than you owe. When this happens, most people lose their entire
down payment even if the market only fluctuates by 10%.
Borrowing might sound really good on paper until it doesnt
work out for you. Thats what happens when the money you borrowed is more than your propertys current market value. Why do
that when you can just start off small?
Imagine if youre able to get a lot for $2,000 that was at one
point worth over $40,000. Ive actually done that, and Ive doubled or tripled my money by quickly reselling the lot. How do I do it?
Although at its peak, somebody paid $40,000 for the lot, Im coming in and paying less than $2,000. Then I take that property and
using one of my online selling techniques, put it up for auction to
a worldwide audience. Most people around the world cant believe
they can own a vacant lot in America in a residential area for under
$10,000 and the profit as a percent of purchase price is very high.
Anything in life is possible and everything has a certain risk.
What are the chances Im going to have to sell that lot for less than
$2,000 if it once sold for $40,000? Im not even waiting to get it
to go back to $40,000. To me, this is a much more calculated risk
than putting your $10,000 down on a $100,000 property. If its a
great deal and somebody with cash comes in and undercuts youll
lose that deal.
21

Many of you have had that experience. You find a great deal on
a property, youre getting your loan approval together, and youre
offering more than the guy whos paying cash. But for somebody
who offers cash, the bank usually has a quick, no questions asked
closing making it harder for those who require financing and
those looking for financing usually loose the deal.
Using Land Investments to Build Capital

If I can get a free and clear piece of property without a lien
or mortgage, at least I actually own the property. If the economy
crumbles or I lose my job and can no longer pay that monthly
payment theyre not going to take the property from me because THERE IS NO MONTHLY PAYMENT AND NO FINANCING INVOLVED!
I feel good knowing that I own it free and clear, and for you,
that can be your start. Ive purchased many lots for less than
$2,000. Some Ive resold for only $5,000, but I still more than
doubled my money. Nobody can argue with more than doubling
your money even if its a small amount because now you
have more money to work with. Then you do it again, and again,
and eventually youll have even more money to work with to buy
single-family homes, duplexes, or multifamily apartments.
This Isnt a Get-Rich-Quick Scheme

Youve probably seen some of the killer deals Ive done and the
amazing profits Ive made. Im sure that motivates you, but at the
same time you cant predict the future. All you can do is base everything on today. I can tell you what I do, but ultimately, you have to
be comfortable with applying these techniques or youll never do it.
22

Thats why my goal is to give you the tools in my arsenal so you
can pick and choose what works for you. You dont have to use
all of the tools; in fact, Ive had people who have paid me $15,000
tell me the entire system was worth it for just one tidbit. Theyve
said, I would have felt like you delivered just based on that one
technique, because that will save me money, and I will make a ton
of money from that specialized information.
Thats the feedback I get, and it makes me feel good because
thats the whole idea. It doesnt matter what you pay for a piece of
knowledge; if it makes you 10 times the amount you paid, thats
a great deal.
Im not saying that land will make you an insane amount of
money. I am saying if you have very little funds to work with, let
land be your start because at the very least you cant lose 100% of
your investment capital.
If you own an undervalued piece of land and you simply dont
want to sell it for less than $2,000, you lose nothing. You can stick
by that price and not sell it until you make money. Im not saying
its risk-free, but this is whats called a calculated risk. You dont
have to sell it for less than what you paid, and the upside has great
potential.
Be Prepared for a Great Opportunity

Lets look at a different scenario. Lets say you didnt fully understand what you were doing when you bought a piece of land
and think you may have slightly overpaid. Knowing somebody
paid $50,000 $60,000 for it, and you still feel like you overpaid
at $3,000. If thats the case, just hang in there.
23

The economy is just starting to do well again. Dont sell it for
$2,500, thinking thats all youll ever get for it. Heres a really
quick example from personal experience.
I was on an auction site not too long ago, and I saw this commercial
lot with a huge judgment. It was massive definitely over $200,000
on a vacant lot and I thought, Wow. Thats really expensive. So,
I click on it. Then I discovered it was actually a commercial piece of
land, it was almost an acre and a half. Then I realized that theres a
brand new housing tract across the street and that the commercial lot
was close to downtown and had huge potential.
So I gave it a second thought once the auction went live I saw
that the bidding was at $25,000. Then I clicked on something else,
and I see that its advertised for over $400,000. Not only is the
judgement owed over $200,000, but there was a previous sales listing on the exact same property for over $400,000, and right now,
nobodys bidding on it at $25,000.
Although I originally had no intention of buying that lot, I
said, Oh, what the heck, and I put in a bid for $25,100, because
that was a smoking hot deal for an acre and a half commercial
lot on a busy street. I did a quick look-around online, and I saw a
$600,000 place next door.
Sometimes it can take you an hour to figure out something is an
amazing deal or it can literally take you two seconds. Sometimes
the evidence is overwhelming that its a great dealand if its not,
we simply dont buy.
But I saw that $400,000 listing. I saw the judgment was through
the roof, and I saw that the previous owner paid over $200,000.
To me, that was overwhelming evidence that it was a great deal for
24

$25,000. Because of my own techniques, I was the only bidder. I
got it for $25,100. Within a few days I got a cash offer for $80,000,
because the person who gave me the offer didnt even know it was
going to auction.
You might be thinking, With such a great deal, why doesnt
someone else buy it? Well, you are that someone else. I am that
someone else. The people who beat me out on a deal are that
someone else. There were people who would have bought that lot,
but they had no clue it was going to auction. This is specialized information. Somebody gets the property, but only ONE somebody.
You can be that somebody.
Maybe you were getting bored reading this section because you
were never going to consider buying land. Im glad youre reading
it, because if I opened your eyes to the possibilities at least now
you know that sometimes things do fall in your lap if youre
prepared to take action. Another great benefit to land is that no
repairs are involved. No leaking roofs or remodeling required.
If I hadnt been prepared and didnt even understand what was
happening with that commercial property, I never would have bid
on that property. But I was prepared, and without even advertising it for sale, somebody offered to triple my money.
Heres one last thing to consider: There will be more people on
this planet, but there will not be more land. If something sold for
$60,000 when there were less people on the planet, what about
when there are twice as many people on the planet? Couldnt it sell
for $60,000 again? Couldnt it sell for $80,000 or $90,000? Im here
to open your eyes to these opportunities. So, if you have limited
funds, or even if you have a good bankroll, it is important that
you always consider buying land.
25

Investing in land can be a great decision. When other people arent
interested in investing in land, it can be a great opportunity for you,
especially if you want to have the potential to build-up your bankroll
to really get started in real estate. This is a good example of how you
can go against the grain in this situation and use it to your advantage.
Make land investments the right way. If you dont have a lot of
money to start with, low land prices mean you can own a property
free and clear, flip it fast, or sit on it, and sell it later. Taking a calculated risk and putting yourself in a position to succeed means
you can build more capital to invest in real estate.
Use this information and these techniques as you see fit. Only
you know what youre comfortable with, and the more you know,
and the more you practice using these techniques, the better youll
become at making good real estate decisions.
Be prepared for a great opportunity. Youll find that luck seems
to come your way when youre prepared to take advantage of a
great opportunity. Real estate is no different. Youre learning how
to get the information you need so you can make informed decisions. Youll find the more informed you are, the more confident
youll be in your decisions.
What about Starting with Houses?

Through tax auctions and foreclosures, Ive seen houses that
sold for:
$3,900
$5,000
$3,000
26

And I even saw one that sold for less than $2,000
There are cheap middle class, blue collar areas all over the
country, but you cant count on something this amazing all the
and sometimes it makes sense to pay $10,000+ to get something a
little nicer that needs less work.
Be Patient and Diligent and You Will Find Great Deals

I would rather get a couple of really cheap homes, and have two
deals working for me at one time.
I could list one of them on Craigslist. Its free. Give it a try.
Maybe Id list the other one on eBay.
I would not put two on eBay, because Id just end up competing
against myself for the same buyers. My listings would look similar, sound similar, and probably be selling in the same price range.
Id list them on two different sites, and then Id have two different deals working for me, instead of against me.
Does this strategy make sense to you? Let me give you an example:
Lets say you have $10,000, and youve only tied up $6,000 of it
instead of blowing all $10,000 on one house.
Now you wont feel like: Oh, I have to sell this below what its
worth because all your capital is not tied up.
Stand your ground. If you are using one of my online auction techniques, you can put reserves; you can put dollar amounts, the lowest
dollar amount youre willing to sell it for and minimize your risk.
Dont get too greedy. Just move forward to the next deal.
27
Greed Will Hold Up Your Process

Lets say:
Somebody offers you a $2,000 profit on your $6,000
purchase
But you think you deserve an $8,000 profit
You could have made $2,000 in a week or 10 days
But because of greed, all of a sudden youre holding out to get
so much more, and it takes you several months just to make a little
more money.
Those Funds Are Sitting on the Sidelines

Your employees are tied up while you are saying to yourself, I
can get a little more!
You may end up getting your higher profit, but youre waiting
several months to do it.
It looks great on paper, because you bought it for $6,000 and
sold it for $14,000, but remember time is money.
But look what you did. You took funds and you left them on
the sidelines while you were waiting to get a higher profit instead
of just building incrementally.
What if: You take a smaller profit right now and reinvest it in
another property, so that other property can be working for you?
Or, you can have two more properties working for you at the
same time instead of just 1.
28
Dont have the Mentality of Get-Rich-Quick

I do not teach get-rich-quick. I dont know how to get rich
quick in real estate.
What I do know is how to buy below market value and sell
quickly for a profit. I also know how to keep the property, rent
it out, and generate a very nice monthly income. Thats what Ive
done. Ive built strategically to what I have today.
You hear people claim all the time, With no money down, you
can get rich quickly.
I dont know how you would get a great deal on a piece of property with zero money when there are people with cash willing to
buy that same piece of property.cash willing to buy that same
piece of property.
You have to wonder, its such a great piece of property, why
didnt someone with cash buy it?
I know those outdated techniques are still circulating but maybe
someone could clearly explain to me how you would do it, because
with all the deals Ive done, I actually dont know how you could
truly get a great deal without using any of your cash or credit.
I know:
How to buy and sell a property
How to start off with little capital but not with none.
How to build investment capital
If those are your goals, then, Im your guy.
29

If your goal is to just get rich quick, Im probably not your guy.
There are lots of so called gurus that claim they will teach you
how to get rick quickly. If thats your goal, youd have to talk to
them and if it WORKS then please relay that information to me.
If you want to start with under $10,000 and work your way up,
Ive laid out a clear plan of how to do it. This chapter could have
easily been titled, Starting with under $5,000.
If I Had $10,000 Heres What Id Do

If I had $10,000, its a no-brainer. Id buy a couple of $2,000
lots in South Florida right now. You can get those every week,
anytime. Very little research is required. You get a lot that sold for
$50,000 to $60,000. To me, theres very little thought required to
make that kind of investment.
Youre quite literally paying 5 on the dollar. You might only
make $1,500 or $2,000, but you only tied up a small amount of
your money. Your security blanket is that previous peak point that
the property sold at, or was purchased for.
You have that benchmark of it being the highest value that
property ever attained. What you know is that it could take 100
years to get back up to that mark. It could also take just five or
ten years.
You dont even need it to get all the way there. Just get to 20%,
30%, 40% of whateveryou are willing to sell for, and youre a massive winner.
30
CHAPTER 4 Summary:
Start from where you are, get clear on why you are
investing, and work your way up.
If youre starting with $10,000, dont tie it up all at once.
Get the cheapest pieces of land, as quickly as possible, by
attending a tax deed auction.
If you get a couple of cheap houses, list one of them on
Craigslist and the other on Ebay or the dozens of auction
sites that are out there. That way, youll have two different
deals working for you, instead of competing against
yourself by listing on the same online sales sites.
Dont get greedy. It will only delay your process.
31
STUDENT TESTIMONIAL
Learned How to Find, Fix, and Flip Real Estate for
Pennies on the Dollar!
Mike shows you whats working now, not yesterday,

not in 1980, not in 1990, not even 2000. His system is so
simple that even a child can understand it.
Ive spent tons of money in the past on different real
estate courses and even boot camps. None of them can
touch this with a ten foot stick.
I not only learned how to find, fix, and flip real estate for
pennies on the dollar, but I also learned how to use real
estate to fund my childrens education tax free!
Chika, One of Mikes Real Estate Investing Students
32
CHAPTER 5
The Current Housing Market

I am sure youve heard people say this is a depressed market.
This is not the time to get into real estate. People have been burned
in deals. Watch out.
If you listen to the media, you might hear some markets are
coming back, but most of the country is still flat.
Let me be extremely clear.
This is the best housing market any of

us could ever hope for.
In my lifetime and in your lifetime, this is actually the best
housing market. The conditions are ideal to potentially make an
incredible amount of money in real estate.
Ive been doing deals in real estate since 2002. I was here before
there was a real estate boom. I was in real estate during the big
boom and during the crash. And, Im still in real estate now as the
market is starting to improve.
I can tell you, without question, right now is better than any
time before, during, or right after the boom. The profits you can
make now are far better than the profits I was making before the
boom, or even during the boom.
33

During the boom, it was foolproof, you would just buy the
house and simply list it with a realtor, and someone would buy it.
Thats because the real estate market was growing at such a rapid
rate that you would have had to TRY to fail in real estate. Now
were in a different situation with far less competition.
But thats ok, because one of the most important secrets I share
with you is:
A Proven System That Works in Any Market Condition

This is critical because my system shows you how it possible to
start making money now, in a year, in 10 years, and 20 years from
now.
Before the real estate boom, I was investing in blue collar areas.
I was looking at cash flow, and I was buying so far under market
value that getting rent checks every month was a spectacular bonus.
Like many of you, I didnt have a lot of money to when I first
got started started. I was focused on properties under $10,000.
When the market was not booming, I was focused on building the
number of properties I had and increasing my monthly cash flow
from rental income. But at the same time, I was trying to build my
capital, so I had to flip some properties too.
When were in a real estate boom, flipping properties quickly
makes a lot of sense because the gains are huge and they happen
fast. The key is staying in touch with market conditions. When the
bubble starts to burst, you can use my selling techniques and sell
your properties quickly. Or, buy them so far under market value,
the price fluctuations dont impact you.
34

This is my business. I am always doing detective work and staying abreast of the hottest trends in buying and selling property.
Thats what I am presenting to you now.
Right after a boom is a very exciting time because everyone is
running from deals. That brings us to the next secret.
When Everyone Zigs, You Should Zag

The secret most people dont know is that real estate markets
always come back. Always. When the bubble burst, everyone was
selling their properties for a fraction of what they were listed for.
I was out there buying.
People thought I was crazy. Theyd say, Mike, you just bought
a property that lost 35% of its value in 6 months. And I knew
that was the perfect time to buy. Should I have bought it earlier
when it was at its peak? You can only lose money that way. I acquired substantial wealth buying properties no one else wanted
right after the bust. And even today, there are properties available
every single day way under market value that nobody wants, or
even better, nobody knows about.
You can sum it all up with another secret:
Its Always the Right Time to Get into Real Estate!

Ill also add that any way you get into real estate works, as long
as you are NOT borrowing money to do it.
For me, it happened almost by accident. I told this story in the
introduction, so if youve already heard it, be patient and Ill give
the short version.
35

I was lucky enough to have a great job in my early 20s. I was
making a lot of money living in San Jose, California. One day, I
was just surfing the web and saw an ad to purchase a duplex in
Buffalo, New York, for $25,000 with monthly rental income
of $1,100. My first thought was that this had to be some kind of
scam. After just one year, I would be making close to a 40% return
on my investment.
I called the seller. He thoughtfully answered every question and
seemed legitimate. I decided to take the risk and sent him a wire
transfer for $25,000, and he sent me the deed. I then ran an ad in
the local San Jose newspaper that said:
Rented Duplex, $50,000

The reason this ad was so successful is that a two bedroom
condo in the worst part of San Jose was selling for almost 300k.
The idea of buying a duplex with a yard and built in rental income for $50,000 was absurd. Within a day, a woman responded.
I showed her pictures of the property and proof of the rental income. Then I gave her a $5,000 discount if she would commit to
buying the property that day. the property sold by just running
an ad in a booming market and buying the property in a stagnant
market.
This was a peak experience for me. I was sitting at my desk and
I realized that with a few hours of work and a few phone calls, I
just made $20,000. That is more than some people make all year,
and I made it with about 23 hours of work.
36

You can guess what I did next. I called the seller up and asked if
he knew of any more properties I could buy. He did, and I quickly
sold three more for about the same profit. When I realized there
was a great opportunity, I actually moved to Buffalo to fully take
advantage of that market.
It all goes back to what is your WHY? If you are ready to make
a full career of this and maybe even quit your job, you may find
yourself making big, bold decisions like this it certainly paid
off for me.
CHAPTER 5 Summary:
The current housing market is ideal for making
substantial profits.
Use a proven system that works in any market conditions.
When everyone zigs, you should zag.
Its always the perfect time to get into real estate.
37
*5616/5618 5th Avenue: Bought for $13,600 Sold
less than one month later for $46,500 I Made a
$32,900 Gross Profit
This duplex is located in the city of Ft. Myers, South Florida.

I purchased it through a foreclosure auction exactly the way I
teach you in this book and on the DVDs. When I showed up at
the house, it was already rented.
My tenants signed new leases, making it easy and quick
to sell as an investment because the tenants were already in
place, and I had the documentation to prove it.
In fact, I resold this duplex using one of my online techniques
in less than a month making a very nice $32,900 gross profit.
I didnt have to do any work because it was already rented.
There was a little bit of cosmetic work that needed to be done
on the upstairs unit, but I made a deal with the tenant for him
to do the work, and I waived his first months rent. This is a
good example of how to be a 30-day landlord.
38
CHAPTER 6
The Biggest Secret: Buy

below Market Value
When people think of traditional real estate investing, they
think of:
Buying a house
Waiting for the property to go up in value
And then reselling the house
Thats the typical mindset of real estate investors.
They think: The market is hot, so I could buy a house, and if it
goes up 20%, I just made 20%.
This Type of Thinking Is Super Risky

Its something I would never do. I dont want to buy property at
retail value and hope that it could someday go up in value. My biggest real estate secret is not to buy based on an up economy, a down
economy, or a sideways economy. It truly does not matter what our
economy is doing. It doesnt matter whats going on in the world today or our current political structure. Things like that are irrelevant.
What matters is gaining the property so far under market value
that the chance of losing goes way down, and the chance of making money goes way up.
39
My Money Is Made When I Buy

When I tell people, My money is made when I buy, they look
at me a little puzzled.
They say, What do you mean your money is made when you
buy?
I say, Because I made my money when I bought it.
For example, lets say today I bought a property worth

$100,000. Thats what all the houses in the neighborhood
are selling for:
If I buy it for $60,000, I literally just made $40,000
because we already know its going to sell for around
$100,000. If $100,000 is a fair market value, Ive made
$40,000 by buying it at $60,000.
Now, if I buy it at $100,000 and hope its going to go
up 20% next year and it does, I look like a genius. But,
what if it doesnt? Look at the risk in this example.
What if it doesnt go up?
What if it goes down two percent or up two percent or
goes sideways? Now, your property is worth $102,000
or $98,000 or $100,000. Remember, I paid $100,000 for
the house if I pay retail value.
To me, thats not real estate investing, thats gambling. People
ask me all the time, Isnt buying real estate risky?
It depends. If I were to pay market value for every house, then
yes, that would be extremely risky. Because how do I know that
its going to go up. There is not a single person who can say they
40
The Biggest Secret: Buy below Market Value

know how to time the market perfectly. So always remember your
money is made on the buy.
My Advice: Buy Properties under Market

Value because Your Risk Goes Way Down
Heres an example if youre buying an investment property:
If you buy a property for $100,000 and you move
someone in for $700 a month, that would be $8,400 a
year. That would be an 8.4 percent gross return on a
$100,000 investment.
Now, imagine you bought that property for $60,000,
and youre getting $8,400 a year on it. Now you have
almost doubled your gross return (8.4% goes up to
14%), because you bought it so far under market value.
If youre looking to be a landlord and you buy it at
40% under market value, thats a 40% higher rate of
return youre going to make.
Id rather:
Get two houses at $50,000 ... or, one at $60,000
Take the rest of the money and buy another at $40,000
Then I have two properties, instead of paying the
$100,000 for one property and hoping I will make money
based on the current economy.
This strategy is about creating instant

equity, when you BUY!
This Is My Biggest Secret
41

Everything Ill teach you is based on this secret of buying under
market value.
In this study guide and on the DVDs, I am teaching you:

How to find homes and land way below market value
How to fix them up and flip them for a quick profit
How to rent them out for a steady monthly income
How to find property managers and contractors that
wont rip you off
How to find good markets
How to invest in your own retirement account tax free.
How to provide for your childrens education account
tax free.
How to wholesale properties for profit and quick sales
to other investors.
How to use the power of the internet to work from
home.
You may be thinking: The economy fluctuates a lot. How do I
know what the property is really worth?
With the power of the internet, you can remove speculation:
You can look at the street the property is on
You can see what houses were sold on that street
You can see what sold previously and at what price
You can find the square footage
You can verify any liens or back taxes.
42
Its All Public Record

Realtor.com will show you current asking prices, and Zillow
.com will show you the whole street, what is currently selling on
the street, and all previous sales.
Zillow.com will give you something called a Zestimate, but
dont pay any attention to their Zestimate, because in my opinion
it could be either too high or too low. Use the comparable sales
and find similar like homes that have sold in the last 3 months..
The powerful thing Zillow.com does is it puts up a map where
you can see the previous sales around the house youre considering as well as showing you any previous sales of the property your
evaluating as well as age and square footage. This is all extremely
good data when your figuring what you should pay for a property.
For example:
You would be able to say to yourself: Okay, two blocks over a
three-bedroom, two-bathroom house just sold for $400,000. And,
three streets over, the same sized house just sold for $405,000.
Using this tool, you can start to get a sense of whats selling in
the neighborhood.
We call this comparable sales, or comps for short.
Comps will show what houses recently sold for. Thats one way
to get a sense of the market value. You simply look at houses that
are close in age and square footage and see how recently they sold.
But now you might be thinking: How do I find out what that
house sold for in the past?
43
Zillow will give you numbers on past sales as well:

There is a section on the site that says sale history. This section will show you a map with dates of what the sales have been
over time. You can also see what is currently being offered for sale
currently and the size and age of those properties. It helps you
to determine what you should consider paying for an investment
property based on how much you are looking to buy under market value. All of this is on Zillow.
Remember to check comparable sales:

Once youve entered the address of the home youre
looking at on the main page, you may see on the map a
group of properties that have already sold which certainly
can give you a comfort level or tell you that what you are
considering really is not that great of a deal.
You can then enter the address of the comparable sales and
get even more properties around the area and research it.
How big is the property, what year was it built, how many
bedrooms, how many baths, how is it comparable to the
one your looking at? Is it bigger, or is it smaller?
You want to compare the subject property (which is the
property youre thinking of buying) to the properties in
the surrounding area. You dont want to compare a 2007
house with a 1960s house. You want to compare apples
to apples.
Remember, you can do all of this at Zillow.com.
What do you do if you want to search a little further out? Is
there a school right by? Is there a library?
44

These are great questions that may be important to your buying
decision. Youll find the answers to these questions with the next
tool Im going to share with you.
Perhaps you dont have the time to fly to a potential property
and scan the area. Youd like to see the area, but you quite simply
dont have time. Use a tool called:
Google Earth
With Google Earth you can virtually drive down the street.
They have little cameras mounted to the top of cars and
they drive all around most neighborhoods in the Country.
You can virtually drive down the street and see your
subject house, the neighborhood, and the comps as well.
All from the comfort of your own home.
This tool allows you to really get a feel for any
neighborhood.
What if youre searching and you notice that there is nothing
for sale in the neighborhood? What if there are no comps around?
This Is A Good Sign!

It means that properties dont turn over in this neighborhood.
Its probably a more desirable and stable neighborhood. When
you go to a less desirable area, there will be tons of houses for
sale. More desirable areas will have less.
These two tools will help you estimate the propertys current
value, which will in turn help you make an educated decision
about your possible purchase. And remember, the secret is to buy
your property below its current market value.
45
CHAPTER 6 Summary:
Dont follow the typical mindset of real estate investors
by buying property you think may someday go up in
value. Its too risky.
Remember that it doesnt matter what the economy is
doing. What matters is gaining the property under market
value. This decreases your risk.
You can eliminate speculation by using the power of the
internet. Use Realtor.com, Zillow.com, and Google Earth
to get all the information you need.
46
STUDENT TESTIMONIAL
Ive earned over $60,000 in profit, and I now get
$2,300 a month in rent!
Within several days of training with Mike, I purchased

my first property. I spent a few thousand rehabbing the
property and fixing it up. I followed Mikes techniques
about renting to tenants and was able to quickly rent that
property. I saw gains right off the bat, and then when I
sold that property, I actually made a $40,000 profit just on
my very first deal.
Since then, Ive purchased six other properties. Four
of them I chose to hold and collect the monthly cash
flow; two of them have been sold, and its absolutely
changed my life. My wife and I are now getting set up for
our retirement because I put the rental properties into my
self-directed IRA, and were only in our 30s. Now, every
month I am collecting $2,300 in tax free rent checks that
go towards our retirement.
Shawn, One of Mikes Real Estate Investing Students
47
CHAPTER 7
Where to Find Investment

Properties
People often ask, Mike, do you have a strategy for investing in
my own backyard, in my own neighborhood?
Realtor.com and Craigslist are fantastic places to find local
properties.
Craigslist is like a massive classified section in a

newspaper, but its online and you can search any market
in the entire country:
You can pick any small or large city. More importantly, you can
look for something close to where you live if that is your comfort
level.
Put in the name of your city on Craigslist and theres a special
real estate section on the site to help you find local properties to
buy.
On Craigslist you find a lot of investors or buyers that dont
have the same tools that Im sharing with you so they are sometimes really motivated to sell which translates in to lower prices
often times.
49
Often, investors dont have these tools, so theyll just:

Buy a property
Get in over their head
They wont know what theyre doing
And they will just want out of the property
Craigslist Is a Cheap Way for Anybody to Sell a
Property because the Listing Is FREE
Youll find a lot of, FOR SALE BY OWNER properties Its
a great way to find deals but its also a good tool to help you sell
your property especially if you got a really good deal. Its a good
tool for wholesaling.
Craigslist is a great way to check things out in your own backyard. You can go on Craigslist right now and you will see properties in your area for sale.
Craigslist is constantly updating their site. The newest properties
are listed at the top of the list by the date and time entered. If
youre the first one to see it that day and respond quickly, you may
beat everyone else to the punch. The further down you go on the
list, the more time has passed since the ad was placed and it may
be a good opportunity to low ball an offer.
Go to Google and type in Craigslist and your state. It will give
you a choice to click on a Craigslist in your city. Click the link and
it will take you to your local Craigslist site.
Once at the site, youll see a section called housing. At the bottom of the housing section it will say real estate for sale. This is
50
Where to Find Investment Properties

where youll find the page with properties for sale. The one on the
top is the newest entry.
There is an advanced search section at the top of the page.
You can search houses for sale by:

Owner
Broker
City
Price
Bedrooms
House type
Since Craigslist is constantly updating, you can look daily

for the newest properties:
Go in daily and check it out. If you cant do it every day, spend
15 minutes a night, or every couple of nights while youre watching TV. Do this research after you put the kids to bed, after dinner, or right before you go to bed.
Create a habit around this and youll end up finding some really
great deals. Timing is everything on Craigslist.
Since youre looking for properties in your own back yard, youll
probably know the general location of the this is just one tool for
buying and selling that many of my students never considered.
The old techniques of buying and selling real estate would involve
doing this same thing but in the newspaper classified ads. The
power of the internet just enables you to do it in any city from
51

a computer. I still prefer the auction as the quickest and easiest
source to buy cheap properties online.
You can use all the tools I am teaching in this study guide
together:
Maybe youll be on realtor.com and see a house you like.
Then youll be on Craigslist, and youll see one just like it
and notice that its 10% cheaper on Craigslist than it was
on realtor.com.
You may even see the same property on both. Notice if
there is a price difference. It may be cheaper on Craigslist
because youre dealing with the owner directly.
I Want to Open Your Eyes to the Different

Ways of Searching for Property
You may have heard about Craigslist and might have gone
on the site looking for:
A car
A garage sale
Or to sell something yourself
Most people dont know that Craigslist is also a phenomenal
tool to find houses for sale.
Were not focused on rentals in this chapter, but just so you know,
Craigslist is also a great place to rent your properties. Simply list
your rental, and its a free place to advertise for tenants.
52

I know were not talking about selling in this chapter, but if you
wanted to sell a property yourself, Craigslist would be another
great option. Its also a great place to advertise. It doesnt cost you
a dollar and it helps you educate yourself by creating phone calls
and emails from other investors. When I first started out I always
enjoyed hearing what other investors had to say and their point
of view.
The people calling you inquiring about your property will

educate you by the questions they ask:
Youre asking questions
Answering questions
Interacting
If I want to be an expert on making cereal, I would hang out
with people that made cereal as much as I could. Thats exactly
how you utilize these tools. Craigslist is simply just another tool
to hone your real estate skills.
Third Option: AUCTIONS

Now I will introduce to you a third option called the auction. People get a little nervous when they hear the word auction. I get excited
because its a great way to find properties below market value and I
have made millions of dollars buying through public auctions.
You may be asking, What is a public auction, and who puts it
on? Let me start from the beginning.
If you dont pay the mortgage on your house, the bank is
out that money.
53

If this happens for too many months, the bank can file to
foreclose on your property.
When a property is foreclosed, it goes up for a public
auction and is usually sold for a good value to investors
looking to flip or rent out those properties.
If you see a house with a realtor that says foreclosure, this was
a property that nobody bid on (or the bidding didnt reach the
banks minimum acceptable offer), and was not sold through the
auction. The result was that it was turned over to a realtor. When
the bank forecloses on a property, they cant just turn it over to a
realtor to sell. It must be offered for public auction first so its a
chance to get first crack at a property for a good price.
The bank might have a minimum bid amount that they
would accept.
The bank might say to you, Were going to sell it at
auction and were going to start the bidding at $50,000
and the retail value may be $90,000 but the bank wants a
quick sale.
Chances are you will find the very best value when buying at auction but remember most counties require you to pay cash and that
eliminates a lot of the competition from the investors that simply
dont have the cash. Also you never know if the bank wants to
move it fast or hold onto it for the most money they can get.
When you see a foreclosure sign with the realtor:

You now know that house has already gone through a
public auction.
54

Youre getting the second pick; youre not getting the
first pick.
It was first offered for public auction, didnt sell, and
now youre getting to see it.
You may be asking, How do I find out where the public auctions are in my area and when they are? It doesnt matter where
you live. Some auctions for properties in your area will be online
and others you will need to attend in person but there are definately auctions in every area of the Country.
To find out if your area is online or in person:

You just go to Google
Put in your county
Put in the words County foreclosure and the name of
your county.
If you live in a small county you might not find the
information, so Google the assessors office for the
county your interested in and call them and ask how
they conduct their foreclosure auctions.
If you were searching Monroe County, youd Google
Monroe County Tax Assessor

and get their phone number.
Lets say that it only shows the tax assessors phone number because you live in a smaller county.
55

Call the number and ask them for the phone number for the
department that handles the foreclosures. Once you have found
the right department you call.
And you say, Hi, Im in the area and I want to pick up a foreclosure. Do you do live foreclosure auctions, or are they done
online?
Sometimes the person on the end of the phone is new, or they
are not sure.
They may respond with something like, Oh, can I put you on
hold. I dont know the answer to that.
Theyre usually very helpful and strive for good customer service. Be patient and let them find the answer.
How often the auctions happen is different in each county. Some
counties hold auctions every day, others do not.
Ill give you an example for Lee County, Florida. In Lee County
there will be bank foreclosure auctions on:
Monday
Wednesday
Thursday
Friday
They may tell you about a tax auction which usually happens a lot
less often. At the tax auctions auctions they are selling the homes
of people that didnt pay their taxes. In Lee County Florida as
an example, the tax auction happens online on Tuesdays. Other
areas of the country will handle them differently just call and ask.
56

Some also may only do them once per year. Then what do you
do?
If its only once a year, you want to be at that auction:

You can go there
Spend a week
Do your inspections and all at once and acquire as
many properties as you can at once. It a great use of
your time considering its a weeks worth of work for a
years work and you can get many great deals at once.
Youll come home with inventory for the whole year
Or youll get that one property youve been hoping to buy
for less than $10,000 that may be worth $40,000-$50,000
and you made a years worth of income in 1 year.
Make Sure to Get a List of What Is Going to be
Auctioned before the Auction begins so you are well
prepared and you have done your homework to be well
positioned to find a great deal or several of them.
For example, in upstate New York, theyll give you a foreclosure
list in advance. You can sort through them and do your research
at your leisure. You might be going into a new area you know
nothing about. Its great to have time to do research.
Examples:
123 Smith Street What do homes on this street sell
for normally?
Just randomly pick a few subject properties.
57

Do some online research and make a few calls to
educate yourself about the area.
About a week before the live auction, go to the actual
city, personally view and inspect the properties youre
most interested in buying.
I can do a quick drive-by and a quick inspection of 4050
houses in one day at these types of yearly auctions so that I have
many choices to really low ball my bids and make sure I get the
best deals.
Ive been doing this for a while, so I can do a quick driveby and make my decision:
If Im paying less than $10,000 for a house, and I can
see it from the car
I see the roof is good, the windows are good, the
sidings good, concretes good
Chances are the inside is going to be on par with that
If I pull up and see:
Bad windows
A bad porch
Bad roofing
Chances are the inside is going to be bad too.
Its not a foolproof system, but generally speaking, if someone
takes care of the outside, they take care of the inside. They typically go hand-in-hand.
58

However, just because it has a good roof doesnt mean its going
to be in mint condition inside. These examples are just rules of
thumb that have proven to be successful for me.
Im sharing whats happened based on:
The thousands of properties Ive inspected
The thousands of auctions Ive attended
And the hundreds of transactions Ive personally done
Thats what all this is boiled down to. I like to give examples
based on what Ive done.
Okay, lets say the auction is coming and:

Youve researched five properties
Youve looked up the properties on Zillow.com and
Realtor.com and they all seem to be good deals
Youve decided how much you want to pay
Now what happens?
Lets go to the auction!
When you arrive at a live auction, typically theyll have you get a
paddle with the bidder number on it.
Theyll typically start at a random dollar amount. If its for taxes,
they start at whats owed on the back taxes. In this case, well say
the bids started at only $2,000, $2200, three grand, and all interested parties start bidding $100 dollars at a time typically.
As the auctioneer conducts each auction about 30 seconds apart,
he keeps going up in increments as long as people are raising their
59

paddles. Usually, once he gets in bids he will make all bidders typically start to bid in incremints of $1,000 and now interested parties will have to bump up the bidding price by a thousand each
time from that point on.
Some counties may very slightly but its always the same idea.
So, to break it down simply:

0 to $5,000 might only be $100 increments
$5,000 to $10,000 might be $500 increments
After $10,000 they might bump up $1,000 at a time
Remember that most auctions only last 30 seconds or less so
you really need to be paying attention as the properties you want
are coming up. A thousand properties have been auctioned in a
single day while I was in attendance.
The way to bid is to:

Hold your paddle up and then keep it up until its at your
number dont hesitate while the bidding is low or you may
end up loosing the deal.
Once they pass the number you are willing to invest, pull it
down.
Whoevers paddle is up when he stops talking is the
winner.
You may be asking, If I win the auction, how much am I paying immediately?
Its completely up to the county.
60

What I usually experience is putting 5 20% cash upon winning the bid. Be prepared to put 20%, and youll be surprised and
happy when they only want 5%.
Theres going to be a time period when the balance is due. It may
be the next day or two months later. Each county will have its
own specific process. This is something I like to find out when Im
doing my research, prior to bidding.
Therell be terms and conditions to read through, and it will be
crystal clear what their terms and conditions are. Its always different. You may see the balance of funds are due within 24 hours
or 5% due at the time of the auction but the good news is you can
always read the terms and conditions before placing any bids.
Theyll be extremely clear on it but what Im seeing is from
5 20% required, and sometimes 100% is due at the time of the
auction win. Ive also had to pay the balance due immediately.
You may be asking, Mike, if I find a piece of property and I
decide to buy it from the county, how do I know its free and clear?
Do I need to research back taxes ahead of time?
If you buy a property for taxes and there is a first mortgage on
the property, they would have gotten served that a property they
have interest in is being foreclosed upon. If they dont step in and
pay the taxes, their mortgage is wiped out.
If they do step in and pay the taxes, that property wont be in
foreclosure anymore, remember when you dont pay taxes on the
property the taxes are the senior lien holder meaning the bank will
be wiped out if they dont pay the taxes for the property owner
and the property ends of going through tax foreclosure. Remember the banks are notified when someone owes back taxes and if
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they elect to not pay the property taxes you will see the property
being tax foreclosed.
In some areas, water bills follow the house, and possibly trash
bills or other government fees. Always check with the county your
looking to invest to see what government bills follow the property
(Trash, water, sewer ect...) and possibly trash bills or other government fees. Always check with the county your looking to invest
to see what government bills follow the property (Trash, water,
sewer ect...) and possibly trash bills or other government fees. Always check with the county your looking to invest to see what
government bills follow the property (Trash, water, sewer ect...)
and possibly trash bills or other government fees. Always check
with the county your looking to invest to see what government
bills follow the property (Trash, water, sewer ect...) Find out in
advance, so there are no surprises as the amount owed may affect
your purchasing decision on a $10,000 house.
Through a tax deed sale, sometimes part of those proceeds will
pay the water bill, trash bill, sewer bill ect... Each city or county
will be different.
For instance, in upstate New York auctions, the water bill is
included as part of the proceeds.
When I bid at an auction in New York, its to purchase the

property and pay off:
The water bill
The trash bill
And the taxes
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Okay, now you have valuable information about back tax
auctions.
You may be asking, What other methods will you use to find
a house?
Weve talked about:
The retail approach
The auction approach
Just to be clear, in most areas tax foreclosures and bank foreclosures are held separately from each other. Its not typically in the
same auction day.
In one of the counties in South Florida:
Tax auctions happen only on Tuesdays.
On Monday, Wednesday, Thursday and Fridays, they
conduct the bank foreclosure auctions.
You may be asking, As an investor, what do I need to know about
the difference between a tax auction and a foreclosure auction?
The only difference is:
On the tax auctions, its strictly people that never paid
their taxes.
A foreclosure auction is for lenders who havent been
paid. Their borrower isnt paying them, so now theyre
foreclosing on the property to get their money back.
You may be asking, If I buy a foreclosure, how do I know what
the taxes might be on a property?
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Most counties are online, so if you put in:
Property Taxes, Monroe County,

youll come up with one of the county sites where you can look up
what the property taxes are at any given time.
If youre buying a house at 110 Maple Street, and you see it on
the auction list, you can call them up or go online with the county
to see if 110 Maple Street has paid its taxes.
If you are online, youll see the previous year of taxes too.
If youre calling, they may only give you the current amount
owed but make sure that the current amount is for all back taxes
as well as the current year.
Taking time to do research will keep you from

buying a foreclosed property only to find it has
back taxes owed which is not a problem as long
as you understand there were back taxes and you
bid on it accordingly knowing you would have to
pay them and you factored it into your bid price.
Its worth the time and money to check it out.
I wish there was one set of rules for the entire country, but the
truth is if that was the case, it would be harder for us to buy these
properties. To me its good that weve got to dig a little for the
information. It weeds out people that shouldnt be bidding and
gives us the information we need to make an educated and smart
purchase. Thats why Im giving you these tools and teaching you
how to find this information. This will allow you to make an educated and smart purchase decision. If you give a man a fish he
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will eat for a day, if you teach him to fish he will eat for a lifetime.
This is why it is so important that I teach you and go into detail. I
want to do my best to protect you from costly mistakes.
In upstate New York, its once a year for tax auctions, but it
could be every day for foreclosures.
Some states will auction off your tax bill to the highest
this is known as a tax lien which if not paid will ultimately
end up as a tax foreclosure. Some areas do tax liens
before foreclosure some just foreclose and never do a tax
lien. This is something you would need to check with the
county your interested in investing in. Always remember
either way that if property tax bills are not paid there will
be a foreclosure.
People ask me, Mike, do you like tax lien deals?
I like the path of least resistance.
I like to buy the house and sell the houses Im not really interested in lending out money for a set rate of return although some
people have found great success with it and you may as well.
Tax deed deals are a niche for some people:

Some people dont actually want to own real estate.
They just want to buy peoples back taxes, get a rate
of return, and if you dont pay them, theyll foreclose.
This is possible in many areas of the country but what
I prefer are tax deeds meaning I am actually buying the
property starting at the taxes owed but actually getting
a deed to the property. In my opinion it offers the best
opportunity to make the most money.
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Thats a great specialized niche. Some people dont want to deal
with any of the properties. They are simply looking to get a rate
of return through paying peoples back taxes but not really looking to own the properties in many cases.
Properties sold for taxes only are typically less desirable
properties.
Not always, but if you were to look at a whole group of bank
foreclosures and a whole group of tax foreclosures, the bank ones
are going to be a higher caliber in most cases. Remember this stuff
is just based on my experience and there are always exceptions. A
lot of times I have seen very nice pieces of property sell for just
the taxes.
If youre going to let your property go just for the taxes, you would
have to imagine that its not going to be a phenomenal piece of property. If it was, someone would have stepped in and paid off the taxes
which are usually just a fraction of a homes value in most cases.
If you have a million dollar house and you owe a few grand in
taxes, youd be begging your uncle, your aunt, everyone you know,
every friend, Come on, bail me out just this one time.
The chances are that a phenomenal property isnt going to get
foreclosed on for taxes.
Im not saying it never happens, because it absolutely does happen. But its good to know that the higher quality properties will
be on the bank foreclosure auctions for the most part.
Remember theres nothing definitive. These are all just patterns
and youre going to have your own patterns. My job is to make
sure youre able to recognize these patterns.
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To Recap
Places you can find properties:
Retail
Craigslist
Wholesale from people looking to get out of a property
for various reasons. ( sometimes sad stories like the 3
Ds death, disease, and divorce)
Foreclosure auctions
Tax deed auctions
Sometimes, on rare occasions, you can get a really great
deal with an owner selling the house by himself.
Maybe youre looking to buy in your area and youre just cruising around and you see a sign that says:
FOR SALE BY OWNER
Many times these sellers own their homes and theyve owned
them for a long time. If they dont own them 100%, they owe very
little on their property in many cases.
Of course these are just general observations that

will help you start your real estate investing career.
When you see FOR SALE BY OWNER, that could be a
chance to see if the owner will carry some paper.
What does carry paper mean?
Its a way to say owner financing.
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If they wanted a $100,000 for the property, and you said, Ill
give you $10,000 right now, and you hold $90,000 of paper?
If they like the deal there is a chance they could do it.
If you ask them the previous question, it means, Can you let me
pay you in payments on the remaining $90,000.
Thats a great way to do a deal if you dont have a lot of

cash and its much different than borrowing money from
the bank:
Maybe the property is worth $120,000
And you get an agreement at $100,000
But you only have $10,000
You give the current owner the $10,000
You finance the remaining balance of $90,000 with the
current owner rather than get a bank loan. This could
be beneficial if you have bad credit or you get a really
good interest rate from the current owner.
Some people call that a land contract or owner financing:

You make the deal with the previous owner at $100,000
Now, you work on selling that property
If you sell it for the $120,000, even if it takes you a
month or two, you just made $20,000 with only a
$10,000 investment.
If youre willing to do a little bit of legwork, thats not a bad
deal at all.
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Think of this as a general rule:

If youre really light on cash, youre going to be doing
more legwork.
If youre heavy on cash, you could do a lot less legwork.
Either way, youre going to do some leg work. Nothing is
free. Thats your sweat equity.
If you have a lot of cash and you dont want to use sweat equity,
thats fine, too. Maybe you want to use the realtor option, or one
of the other options Ive shared with you. What matters is that
you get a good deal with a price below market value.
Notice that Im not saying it is okay to over pay. Im just saying
have other people work for you, have other people taking care of
your paperwork and phone calls associated with using realtors. If
you dont have the time to use more sweat equity. Chances are the
less sweat equity you put into a property the less money you will
make. Im talking about all the little things you would have to do if
you have any agent or a broker or someone working on your behalf.
Remember they dont work for free.
People will tell you that buying a home through a realtor is free.
Yeah, its free.
But its not. The money has to come from somewhere.
Lets also include the newspaper, For Sale By Owner sales. Its
not just driving around and seeing the For Sale By Owner signs.
Its also looking in the basic FOR SALE BY OWNER sections in
the newspaper. Those are great if you want to do it in your own
backyard. Youll see many houses For Sale By Owner.
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You Dont Have to Use One or Two of These

Techniques. You Can Use All of Them!
You may be apprehensive, and thinking: Gosh, I dont know a lot
about real estate. Id like to educate myself.
If this is you, start with the basics, start with a realtor. Ill give
you all the tools, and you decide which of them seem like the best
fit for you. Youll gravitate to the ones that serve you best.
CHAPTER 7 Summary:
Craigslist is a great place to find properties in your local
area. Timing is everything. Create a habit of checking it
daily, and you could find some really great deals. It can
also be a great way to educate yourself by placing free ads
and paying attention to the questions people ask when
they call you.
You can find out about public auctions in your area by
doing a Google search on the name of your county and
the words foreclosure processor or tax assessor. Call
the number to find out if the auctions are online or in
person. If you can get the foreclosure list in advance of
the auction, be sure to do your research before you go.
This will keep you from buying a foreclosed property,
only to find it has a bunch of taxes owed on it.
Tax deed deals are a niche for some people, but typically,
when you see properties being sold for taxes only, they are
less desirable properties.
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Owner financing can be a great way to do a deal if you
dont have a lot of cash and youre willing to do some
legwork. You can find these in the newspaper or by
driving around.
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*1136/1138 Homer Duplex: Bought for $53,600
Sold 2 months later for $87,000 Made a
Gross Profit of $33,400
I bought this property through foreclosure. It is two separate

units, side-by-side in one building. It was a brand new property
when I bought it and had never been lived in.
I freshened up the outside paint; the inside paint was good.
The property was already in great condition so this was
abnormally easy for me to buy and then two months later sell
using one of my online techniques.
Duplexes are very popular in Florida, because many people
want to live in one unit and rent out the other unit creating
an automatic monthly income. Ive bought and sold many
properties that look almost identical to this one.
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CHAPTER 8
Properties for Taxes

Im sure youve heard about getting a property for whatever is
owed on the back taxes. If you dont pay your taxes and the bank
doesnt step in and pay those taxes, that mortgage is wiped out.
Lets say you have a first mortgage for $200,000, and you dont
pay your taxes. The government is going to come after your property. The rule of thumb is: the government always gets its money
especially if property is involved. Banks can get wiped out, but
rest assured, the government will go right for property assets to
get their tax money. What theyre going to do is sell the property
for the back taxes owed to the highest bidder in most cases.
Tax Deeds
In this chapter I will educate you about Tax Deeds.
There are always going to be people that dont pay their property
taxes. Its not that they dont feel like paying them, its that they
cant, or believe it or not, the taxes were just overlooked. Maybe
the property was inherited and the heirs just didnt pay attention
to the details, and poof, the property is sold for the amount of the
taxes owed. If the property taxes remain unpaid, the house will be
sold to someone who will pay all the back taxes.
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Look for current examples, from this month,

not what happened a long time ago.
Real Example #1:
I see a property with an assessed value of $230,000, but the opening bid is only $22,000. This usually means the back taxes owed
are $22,000. As you can probably imagine, the back taxes were
paid at the last moment. That is what is called REDEEMED,
the property was redeemed from getting sold for the back taxes
meaning the taxes were brought current before the property was
sold at auction thus the term redeemed.
Theres nothing you can do about that, but the good news is, it
gets redeemed before the auction starts. Its not like youre bidding
and youre so excited because you won the property, and then you
find out youre not getting it. It will most likely be redeemed before the live auction, which is the good news. If a property youre
interested in gets redeemed, you simply move on to the next deal.
Real Example #2:

In this example, someone was able to purchase a property in Fort
Myers for $3,900 thru a tax deed auction, not years ago, but right
this month! This is current at the time of this writing. This is now,
and its every Tuesday in Lee County, Florida.
Somebody got this property for $3,900. That is correct. Someone
paid $3,900 for a property located in Fort Myers, Florida using this
exact technique.
Its actually a house. At first glance, I assumed it was a lot because it was so cheap. I dont know a single person that would not
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take a property with a building on it for $3,900. Its a house that
has dirt under it. Do I even care about the condition?
You might be saying, Mike, but what if its trash. I mean, trash.
Ill still take it for $3,900. Why?
Its still a building with dirt underneath it. Somebody will take on
that project. Theres somebody that would be more than happy to
give you $12,000, $13,000, or $14,000 for a house in South Florida
even if its a massive fixer upper. This $3,900 example house could
be in a horrible neighborhood, but its in Fort Myers, Florida.
How bad could it be? And remember, most people do not have the
ability to purchase these types of homes, because they dont have
the tools or techniques that I am sharing with you.
I dont care how ugly it is. If you paid $3,900 for it, and you told
me that you were going to sell it for a loss, I would ask you why
you dont use one of my techniques for selling online. Always remember that most people dont have the ability to buy a house for
under $10,000 because I did not train them.
No matter how many times you do this, youll

find amazing deals that blow you away!
Im not saying every deal is a home run. What I am saying is
there are deals, every single day, if you know where to look.
Maybe youre saying, Mike, thats a super extreme example.
I agree, but you cant win the game if you dont play.
The examples I am using in this study guide, I saw today
the day I am writing this chapter. Im not just making these up. I
am not going to tell you these deals just fall in your lap. I spend
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30 40 minutes per day researching property auctions so I am
always prepared. I teach people how to do this systematically.
Just so you know youre not going to typically find huge,
expensive, amazing pieces of property and get them for $10,000.
Someone is going to pay off those back taxes (redeem it), if its
just such a ridiculous deal. But sometimes deals do slip through
the cracks. Youve got to be in the game to win it.
One thing I can guarantee if you say, I will never get that
property. I am not even going to bid. You will not get that property. Thats a guarantee. Its all in your mindset.
If youve done your research, and you believe in that property,
why on earth would you not at least just place a bid? It doesnt cost
you a thing to bid on it.
Real Example #3:

Im looking at a property for $20,600. The listing shows it is
two acres of land in Fort Myers, Florida.
It looks like a pretty sharp piece of land, so I dig deeper.
Heres what I discovered: In 2005, someone paid $240,000 for
this parcel of land.
I would snatch that right up.
If I stepped in right now and paid $20,600, I would feel pretty
good about that purchase knowing it sold for $240,000 during the
boom.
I wouldnt be saying, Maybe $20,600 is too much in the current
market.
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At some point, youve got to stop second guessing yourself.
Maybe youre thinking: OK, thats a fluke.
But today, while Im writing this chapter for you, I found two
flukes. Its been a good day.
There are auctions every day, and there are 3,000 counties in
this country. You never know what youre going to find out there,
and thats the fun part.
CHAPTER 8 Summary:
If you are looking to steal a property (meaning that you
are searching to buy a property for an unbelievably low,
low price), tax deed properties are a good place to look.
Tax deed properties are typically not in as good condition
as most bank foreclosure properties. The reason for this
is people who are willing to let their property go due to
back taxes do not see the value in taking good care of
their property. While you will notice many of the bank
foreclosures look nice because people usually bank
foreclose because they simply got in over their head.
You never know what ridiculously priced deals are
waiting for someone to scoop them up. It certainly wont
happen all the time, or every day, but it does happen often
and those go to the people who are prepared and in the
right place at the right time.
Doing your research is how you position yourself to be in
the right place at the right time.
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STUDENT TESTIMONIAL
Ive been a real estate investor for the past 10 years,
and Ive never seen anything like what Mike is doing!
I thought I knew how to find properties, but nothing like

what Mike does.
Ive purchased property in Michigan, Arizona, Texas,
and Canada. The stuff that Mike taught me, the secrets
hes learned over his 12 years of being a real estate
investor, literally blew my mind. I had no idea about some
of the things he showed me; how to buy, tax and bank
foreclosure auctions, and how to submit a bid that is
almost guaranteed to win.
Mike has inside information that is really not available to
the unknowing public. I was able to see how he does it so
I can do it myself.
I just bought two lots today at an online auction. The
two lots sold for $200,000 in 2006, and I just got both of
them for under $20,000. Thats 10 on the dollar. I couldnt
be happier.
Glenn, One of Mikes Real Estate Investing Students
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CHAPTER 9
Running Ads to Purchase

Properties
Besides the techniques Ive been teaching you, I also want you
to know how to run ads that will get your phone ringing with people who want to sell their property to you. You dont pay anything
to select a market and test. The technique I will share with you
will get your phone ringing. Lets go.
Testing the Market Online

If youre thinking that one market might be good and have certain opportunities, but youre not sure, its a good idea to test it
and find out.
To test it for free, you can go to a site like Craigslist, which allows you to see whats out there, see how many people are anxious
to sell their property, see how many people have inventory that
theyre looking to sell. Youll get:
Investors
Homeowners, and
People that have inherited properties.
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Youll hear all the different stories and reasons why they want
to sell, and it doesnt cost you anything.
I even put an ad on Craigslist saying:
Were looking to acquire 50
properties in the area. Were
taking applications for the
first 200 people looking to sell.
Call today 1-800-555-1212.
Create urgency. Everyone else out there has ads like, WE BUY
HOUSES. Thats not engaging. Its important to create a sense
of urgency. Make it ... Were looking to get 50 homes this weekend
by Sunday, or we need to acquire 85 properties. An ad like this will
get the phone ringing off the hook.
Its a great way for you test the market. When people are calling
you to sell you a property, youre in the position of power because
theyre calling you to sell their property. This technique will help
you hone your skills in the area, for free.
When they call you, say:

Whats the best case scenario?
What are you looking to dump this property for?
Use words with embedded commands such as, dump this property, get rid of this property.
Say things like: If you could get the cash in 24 hours, what
would you let it go for right now?
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Running Ads to Purchase Properties

If they respond, Well, Im not looking to dump the property,
you respond by saying, Oh, well if I can cash you out in 24 hours,
how much money would it take? Or, you could say, I dont know
anything about the area. Wow, that seems kind of high.
When people are calling you, it gives you a great opportunity (advantage) to be in the drivers seat and say:
Well, send me some pictures.
What kind of property is it?
How many bedrooms?
How many bathrooms?
This is the online way to test out the market and get people calling you . You can then use the techniques I mentioned earlier to
determine market value and make sure your getting a great deal.
You can also do the same thing in local newspapers, but youll
pay a little bit for the ad. I prefer the Internet. Ive had many
ads in local newspapers to buy houses and to sell houses. Rather
than put up all these street signs everywhere that annoy people
and make them angry that youre putting them on their fences or
on their street poles, you can have a targeted audience by putting
it online. Thats your targeted audience, people that are actually
looking to sell their house.
Advantages of Selling Online:

Usually selling quicker. Not taking a minimum of 60 days
to sell it through a realtor
You save buying and selling comissions, because its not
going through a realtor
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Youre not taking two months toclose the transaction
after getting a contract on the property.
Online really does get a much broader reach and interest
in a given property.
selling online can be done from the comfort of your home
with a lot less time invested typically.
Testing the Market with Letters

Instead of selling online, some people send out letters. It costs
you 49 cents in postage per letter, but it works great.
Let me give you an example. I located a Medical School in a
great area just two streets from a major University. I decided to
send out letters to everybody within the radius of these two colleges. It wasnt going to cost much. Its only a $200 investment
to find if there are any excellent deals and I sent to hundreds of
owners around these two colleges.excellent deals and I sent to
hundreds of owners around these two colleges.excellent deals and
I sent to hundreds of owners around these two colleges.excellent
deals and I sent to hundreds of owners around these two colleges.
When somebody responds to my letter and calls me up,

I tell them similar things I told you to tell the Craigslist
people. Things like:
You know, I sent out all these letters, and Im trying
to find something nice around the university, but I need
the deal to make sense financially.
I have cash available, and Im ready to close.
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What price is it going to take if I can get you your
money quickly?
They may respond:

Well, gosh, Ill give you a great price if we can close quickly.
Im tired of dealing with this house.
And I say:
Well I did get a lot of calls from these letters what is the bottom line number that you will take for this property?
I might just say:

You are being fair and I accept the terms.
At some point, youve got to say:

You know what, youre being reasonable. Youre not being
crazy. I will do that. When can I come and check out the Property.
If they give you a high price dont hesitate to low ball them based
on the comps in the area. Condition also has a lot to do with it so
be sure to factor that in. Ask for pictures like I mentioned earlier.
If youre not in the area, you would say:

You know, Im out of town right now, or, I live in________ (fill
in the blank), but I have a local person right there that will be able
to drop by.
Now youve got to find a local person that would be able to
drop by wherever it is.
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You could just ask the current owner. Say something like:
This would happen a lot faster if youre able to snap some pictures right now, and e-mail them to me. Just use your cell phone,
and snap me a couple of pictures. I dont care if your house is
dirty or clean. Im not looking at the dirt. I just need to know
what were talking about. Ive driven by your house, but I havent
seen the inside.
Naysayers in the business would say, Oh my gosh! Youre going to mail out a letter? Youre going to go through that trouble?
Its just a form letter. Its just a matter of dropping it off at the
post office. Heres a sample of the letter that I use when implementing this technique:
Sample Form Letter

Dear Neighbor,
Im new to the area and Im interested in buying a home in
your neighborhood. If youre interested in selling your home,
please give me a call.
Ive got cash and I am in a position to pay you immediately.
Please give me a call and let me know if you, or someone
local you know, might be interested in selling their home.
Im not a real estate agent or a broker. If we can come to terms,
there will be no escrow waiting period or real estate broker
commissions. That way it can be a good deal for both of us.
Im only going to be in town for a few days, so I would
appreciate your timely response. You can reach me directly
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at 805-555-1212. If I am unavailable, please leave a message
and I will return your call promptly.
All the best,
Mike Gazzola
805-555-1212
P.S. You can also e-mail me at MG@gmail.com. It would be
great if you could take a few pictures with your cell phone,
and attach them so we have even more to talk about.
This is a variation of running ads. You can run the ad and get
them to come to you, or you can target them with a letter.
When testing, its best for you to place your ad, rather than
just looking at ads on Craigslist. It gets your phone ringing and
it teaches you to sharpen your skills by taking calls pertaining to
real estate.
I cant tell you how many great deals Ive gotten just by running
my own ads and mailing letters.
Heres another quick story.
When I first got started in real estate about 12 years ago, I partnered up with an older guy who had 30+ years of real estate buying experience. He was a true master of buying property below
market value. He wasnt good at selling his properties, because
when I met him he owned 42 properties. I was only in the business
for a month or two, and I was learning how to buy good properties for great prices from him.
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I was good at selling properties, but I realized the farther below market value I paid for the property, the more money I made
when I sold it. I was interested in how he was able to buy property
so cheap. He taught me everything he knew about this business,
and 12 years later, Im able to show you an enhanced version of
what I learned working side-by-side with him for nine months.
Note that I learned an enormous amount of information working with him. I also learned things I didnt want to do, because it
didnt fit my idea of integrity and treating people the way I like
to be treated. This is an example of what I dont do when buying
properties.
We ran our ad in the paper. He ran the same ad for many years.
Hed get a couple of calls a day, maybe up to five calls a day. One day,
he says, Hey, Mike, I got a call that sounds like a great deal. Lets
go out there and see if weve got a hot one. I said, Okay. Lets go.
When we arrive at the house, Im thinking: Wow, nice woodwork, great detail, and a good size lot. Im excited. Im thinking:
Wow, if she is only asking for $8,000 or $10,000, like she indicated
on the phone, I know I can resell it for $30,000 to $40,000. This is
going to be crazy. It will just be a quick flip and well be in and out.
The owner of the property is a sweet old lady. She must have
owned it a long time, because she said she was moving into a nursing home. She was really nice.
My partner tells me, Mike, watch this. Were going to get this
property.
He says, Do you know what youre looking to dump the property for?
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The lady says, Oh, gosh, you know, if I can get $8,000 that
would be great. That was already the lower end of the range she
gave on the phone.
Im thinking: Oh my gosh, $8,000! Im ready to accept her terms
as is I believed she was being fair and actually giving us an extremely good deal. Im ready to run to the bank, get cash, and do
the deal.
My partner says, No way. You know, for this piece of junk, I
wouldnt give you more than $2,000.
Im thinking: What? Are you crazy?
She sits there for a moment, and then she says, Okay.
He gives me a wink when shes not looking.
Im thinking: What the heck? Thats ridiculous. Were going to
make good money at her asking price by selling the property to a
worldwide audience. Although the property was only worth about
$10,000 as is once we rented it out and did a bit of cosmetics we would
make a good return. You dont have to squeeze this little old lady that
hard. Come on. What she offered us was a great deal for us without needing to negotiate and if she had to hire a realtor and pay the
comissions and pay an attorney to close it she would have to wait
months and probably only net about 10k after everyone was paid so it
was fair for her to get 8k now and move on and more than fair for us.
My point is, Im not going to say, Oh, your $8,000 is too low,
lets make it $10,000. But at the same time, Im not going to make
her believe that its not even worth the $8,000 she was askig because thats not my style to lie to people to get a good deal. Its ok
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to say the most Ill pay is X amount of money but in my opinion
its not ok to lie about the value when you know its not true.
If people say they want $20,000, and I say I want to pay $12,000,
I wont say its not worth $20,000. Ill tell them, I just cant pay
more than $12, 000. Im not going to lie and say its not worth
more than that. I just say what I would pay for it. I remember
feeling so bad for her. And my partner just winked. I learned a lot
from this about how I didnt want to do business.
Running Ads Is a Tremendous Way

to Get Amazing Deals!
You can run ads on the Internet.
You can call ads on the Internet.
You can mail out letters.
You can even put those annoying signs up.
Im sharing my personal point of view. Im not trying to put
signs up all over neighborhoods with my phone number and say
CALL ME. Youre just going to get angry people calling you,
saying things like, Why is this sign on my fence? Why is your
sign on this light pole? Youll get city inspectors calling you
saying, You cant post your signs on telephone poles, fences, or
streetlights.
Clearly, running ads to purchase properties is a tremendous
technique. People think theres no way this will work. Isnt everybody doing that? You just do it a little different. You dont
just throw signs up that say WE BUY HOUSES all over the
neighborhood and think youre the first one to do that. Think of
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variations, think of ways to get your phone ringing. Do it in such
a way that people still want to do business with you.
Everyone is used to calling and having someone grind them
down. If somebody is being fair, be fair too. Im not going to buy
it if its above my price, but fair is fair.
Heres a recent example: The bank had it wrong on a model
home I bought, asking only $60,000. I realized the price was too
low, because my research showed that its real market value was
about $168,000. Most people are going to offer $50,000 just because theyre asking $60,000 and a lot of people think you have to
negotiate everything. I offered $68,000, and I have $100,000 of instant equity in that home today. I paid $8,000 over asking price but
because the bank had the price so low they got 20 offers the first day
but no one but me used the logic to offer almost 15% over asking
price but I now have over $100,000 in equity on that property.
You may be thinking: In this economy, youre going to pay over
asking price?
Absolutely, if its just so ridiculously low and its way under
market value. The big question is, Why are you worried about the
asking price? You need to look at todays market value. Thats
whats really important.
Ill just tell the sellers what I can pay and they can take my offer
or not. If they dont take it, Ive lost nothing except the two minutes I was on the phone. If they take it, I treat them well. Someone
might offer them a little bit more, but they would still think: I
already agreed on the price with him, and he didnt even argue with
me. He agreed to pay more than what I asked for. So why not just
go with him?
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You cant trust that everybody will do the right thing. Be prepared for when they dont. Its important to understand that there
are enough good people in this business that are going to do right
by most people, most of the time. Running ads to purchase is one
thing. Running ads to sell, thats a different ball game.
In other chapters were going to get into specific auction techniques and creating your listing when you sell. Buying and selling
are two completely different skills. I make my money when I purchase, because when I buy, I create instant equity with my purchase.
Thats why I know Im going to sell every single house. If its a
loss, Im simply not going to sell it.
Theres Never Been a Single Property

I Havent Been Able to Sell
I hope Ive opened your eyes to something new. These techniques work. Try them and see how well they work for you.
Theyve consistently made a bundle of money for me.
CHAPTER 9 Summary:
You can use Craigslist, newspaper ads, or letters to test
the market.
Create a sense of urgency in your ads.
When people call you, ask lots of questions, and use
embedded commands, like dump this property or get
rid of this property.
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*4887/4889 Jordan Duplex: Bought for $55,000 Sold
4 months later for $118,000 $63,000 Gross Profit
This duplex is right across the street from the Westminster

Community Golf Course, which is a really nice gated community.
I featured the location in the listing, and thats one reason it
sold for more than double what I paid.
When I bought it, one side was already rented for $900
per month, and the other side was vacant. I signed a new
lease with the current tenant and did a little landscaping. This
property was in such good shape, there was almost nothing to
do in remodeling and repairs.
As you may know, I like newer builds, and this is no exception,
as it was built in 0607. It took about 4 months to sell, but I
was collecting rent during that whole time.
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CHAPTER 10
How to Buy and Sell Homes

and Land Remotely
In this chapter Id like to teach you about buying and selling
properties online without ever having personally seen the property to make your buying decision.
Most people dont realize their personal computer is the perfect
real estate buying, researching, and purchasing machine the world
has ever known. Thats not a false promise or wishful thinking.
You can actually never leave your chair and conduct a profitable
real estate transaction right in front of your computer using nothing more than your mouse and keyboard.
For most people, that sounds impossible. How could you ever
do that? Dont you have to see the carpet, measure the square
footage, inspect the roof, and know exactly what the tax rolls
say? How is it possible for people to buy real estate online and
sell it without ever having been there, or touched it, or lived in it?
If youre looking to buy properties online remotely, let me explain how I do it without ever having to physically look at the
property.
Lets pretend that Ive never been to South Florida.
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In another chapter I taught you how to pull the foreclosure list
and how to register for a bidder account.
Now lets talk about what you must do before you make the
decision to actually bid on a property. The big question is: How do
you know that its going to be a good property? How do you know
that its not completely destroyed?
As a general rule, if youre looking to buy a property remotely,
it makes sense to go after newer builds. When I say newer builds,
Im talking about 2001, 2002, and up. Those would be considered
newer builds, even though were in 2015.
Lets say today is Thursday and tomorrow is Friday. Theres an
auction coming up Friday, and I just discovered a property I really
like today. I would start with the basics. Id start with the paint,
the roof, and the exterior.
With sites like Zillow.com and Realtor.com, you can find pictures of the property itself. It might be a couple of years old, but
you can see a general picture of the house. It is also not uncommon to find 1025 pictures of the property at these web sites. If
I looked at it, and the roof had holes in it, all the windows were
broken, and the exterior had graffiti all over it; that would be a
property I would pass on.
Lets talk about when it looks good in the picture. What I do is
immediately go on Craigslist, or I Google to find local contractors
in the area of the property who specialize in house painting, roofing, plumbing, electrical, etc.
Pick any city in the country and Google house painters right
now. Youre going to see a long list of local house painters. You
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How to Buy and Sell Homes and Land Remotely

can Google roofers, then window replacement, etc. Google anything you can conceive of on a house and its going to come up
with contractor information and their customer performance
ratings.
The great thing is, when you find a contractor hungry for work
and you want them to give you a bid to do the work on the property, you say, Ive got this property at 123 Main Street. Can you
give me a quote to paint the outside? You call a general contractor and say, I want you to let me know what it would cost to
replace the windows. You end up getting detailed quotes back
from the contractor quickly. If theyre hungry, youre going to get
the bid the same day. No charge. Its free.
Your Eyes and Ears

Rather than speculate about how much new windows are going
to cost, theyll e-mail you with a quote or a comment like, All the
windows look intact. It doesnt look like we need to do anything
with windows, but it does look like you may need to do some
landscaping. The grass is overgrown. The roof looks like it could
be bad.
By getting different contractors out to the house, theyre literally your eyes and ears. You can get 20 different professionals to
work for you for free. When I say, work for you, I mean they
have inspected the property and have given you quotes about how
much money and time it will cost to do the needed repairs.
If were talking about Wichita, Kansas, I can get a plumber, a
window specialist, or a roofer immediately to the site and give me
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a bid on what work needs to be done. Theyll even take pictures
and e-mail them to me.
With cellphones, contractors like to take pictures and send them
to you so you can see for yourself what repair work needs to be done.
These are going to be current pictures of the property. Theyre going to say, The roof looks like it could be replaced. There might be
a couple of years on it, but eventually it will need to be replaced.
You get a couple of roofers and you take everybodys information. Not only do you see whats wrong, but you also get to see
whats right with the property, then youre able to make a calculated decision based on what their repair cost would be.
You take that retail value and back out these costs. You then
look at how much profit you want to make and back that out as
well. Now you have the maximum amount you are willing to pay
for the property.
If you are participating in an auction, this dollar amount would
be your maximum bid. Remember, I cant tell you how much profit
you want to make. If I had ten students in the room, some would
say, Id buy that property knowing that I had $15,000 profit.
Another might say, I wouldnt buy that property unless I had
$30,000 profit.
Determining Your Bid Price

I teach you the tools you need to determine your profit margin:
What is the current retail value of the property?
What work does the property need and how much it will
cost?
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Are there back taxes?
Now you know the work that needs to be done, how much it
will cost, and the amount of any back taxes. Based on this information, you can figure out what you need to purchase that property for you to make an X amount of money. That gives you what
your maximum bid price should be.
When you hire a property inspector, you pay him a couple hundred bucks, and hell tell you everything thats wrong with the
property.
Wouldnt it be much more valuable to not just know whats
wrong with the property, but to know what the cost of fixing each
item would be? Thats exactly what I do.
When Im buying a property, I cant be in ten places at once. If
Im bidding on multiple properties in different areas on a given
day, theres no way I can physically go visit those properties. I get
the contractors, not just to tell me whats wrong, but also what
work is needed for a given property and how much it will cost.
That enables me to make good decisions when I decide to purchase a property remotely. I already showed you in the previous
chapters and you now know how to check for the liens. I already
know how to check the property for back taxes. I already know
how to check the retail value. The missing factor here is what work
needs to be done to the property.
Rather than hiring an inspector, it makes more sense to get my
contractors out there who dont charge to submit their bids to do
the repair work. Any legitimate contractor is going to give you
a free estimate, and if they dont, you simply dont use them. I
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take those free estimates from a few different sources and calculate what my maximum bid price needs to be to make my desired
profit.
I even take the pictures they send me and use those in my online advertising to sell the its always nice to show the before after
pictures or use the existing pictures they take to wholesale your
property.
Know What Youre Bidding On

Sometimes just looking in a window or a simple drive-by viewing can tell you everything you need to know about the condition
of the property. If the lawn is meticulously maintained and the
paint looks great, you usually know thats going to carry forward
to the inside of the house. Its still wise to have somebody peek
through the windows. Strive to have somebody give you a detailed
evaluation. This way you know exactly what youre bidding on.
How do you know how much profit you want to make, and
what youre maximum bid is going to be?
Your maximum bid would be different than my maximum bid,
because we both have different criteria for how much money we
want to make. If youre working with $50,000, you may say, If
Im going to tie up $50,000, I need to make $30,000. If youre
working with half a million dollars, you may say, I dont mind investing $50,000 to make $10,000. I cant tell you what your profit
margin needs to be.
I have shown you how to find the retail value and how to determine the cost of the work that needs to be done. You have to
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decide the maximum amount youre willing to bid, because its
going to vary from person to person.
Are you looking to hold the property long-term, rent it out and
collect monthly rent checks? If youre looking to just rent it out
you may end up deciding to pay more for a properties that require
little or less work.
Its a sliding scale. The more work a property needs, the more
profit margin you want to make. If a property is in verified turnkey, move-in condition, you may be willing to make less profit
because the amount of work is going to be less. Im willing to pay
a higher percentage on the dollar for property that requires no
work.
When I say more, Im not talking about a dollar amount. When
I say pay more or pay less, Im talking about paying more as a
percent of retail value, or pay less as a percent of retail value. If a
propertys worth $80,000, Im not saying, Oh, youve got to offer
$50,000, because it needs $30,000 worth of work.
Again, its a sliding scale. Whats the retail value? How much
profit do you want to make? How much work does it need? Everybody needs to determine their own bid price based on those
factors. Remember, the one factor I cant teach you is how much
money you need to make on a property.
Now weve gone online. Weve found the auction. Weve opened
up our bidder account. Weve done everything that allows us to
bid on a property. Now were actually bidding on a property, and
this amazing thing happens which I really like. Its the concept
of I won the bid! Which is a really positive experience.
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Its very exciting. You feel like youre actually a winner. Now
that Ive won the bid, whats my next step since I dont have any
intention of physically going to Florida because right now were
talking about the ability to purchase properties remotely.
Now you go from it being a prospective purchase to its a done
deal. Now its time to complete the sale online because the balance of the money is due within 24 hours. Were talking about
the online auction, and were using South Florida as an example.
You have 24 hours to pay that 95% balance due, because the 5%
already came out of your bidder account the moment you won.
If you dont pay within 24 hours, your 5% is taken by the county;
a penalty for not keeping your bid.
They dont cancel your bidder account. Youre not restricted
from future bidding. Your limit of liability is that 5% of whatever
you bid on the property. If youve never seen the property, the
next 24 hours is your opportunity to sharpen your pencil, and
confirm your quotes. The good news is if you back out or you
dont like the deal you have the 24 hours to figure out if the deal
works for you and if you walk away you simply loose 5%.
Get Concrete Numbers

You may be happy with your winning bid, or you might want
to get a couple more quotes on the work that needs to be done.
Youll want to get more people out to the property site to send
more pictures and more detail on the cost of the work that needs
to be done. The good news is 24 hours is a long time to really
sharpen your pencil and make sure your getting a good deal.
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Dont hesitate to call as many local contractors, property managers, or realtors to help you out in this step.
I like to send someone out to the site to give me a general report
on the property. To do this, I look on Craigslist and find somebody thatll go out and take more pictures of the property. This
allows me to further determine what repairs are needed.
From there, I like to take it a step further and get a painter, a
plumber, and/or an electrician out there to take a look at the property and submit their bids for the necessary repairs. I do all this to
make sure I am working with concrete numbers.
Now that Ive won the bid, my liability so far is 5%. Since Ive
never seen the property, I really want to get more information
from other professionals. I like to call a few realtors and simply
say, I just bought this property today. Can you send me some
neighborhood comps? Can you let me know what you could sell
it for? Even though I sell it online to a worldwide audience, I still
like hearing from local experts.
Do you tell the realtor what you paid?

No. If they ask, tell them. Typically, they dont really care because theyre selling the property. They make their money off the
maximum sales price. Theyre not really too concerned with what
you paid for it, but if they ask, I simply tell them.
Be 1000% Confident
You can be as cautious as you want. I call it indisputable evidence. We all need X amount of indisputable evidence before we
can be 1,000% confident. To me, it might take having two different
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people out there. If Im familiar with the area, two different people telling me the same thing makes me feel confident. If youre a
really cautious person and its your first deal, you might want to
get reports from four or five different contractors.
Lets say you decide you dont want to fix up the property. Either its too much work for you, or it really doesnt need much
work. Both of those things happen.
If you really want to quickly flip it; you want to turn around
and sell it, and add your profit margin into the price. The price is
now whatever you paid for it plus your profit.
How to Sell It
Now the big question is: How do you go about selling it?
There are a couple of different ways you can sell it. In some
areas theres still very little inventory for realtors to sell. My first
step is to go to Realtor.com. I would look at what comparable
homes are selling for on the low end and the high end. To do this,
simply go to Realtor.com, and enter any city in the entire nation.
Then sort the homes by price. I have already gone into great detail
on this process in previous chapters.
Low Inventory
If I see theres not a lot of inventory that prompts me to call
up a local realtor (maybe 35 of them), and determine which one
I want to work with based on:
Whos the most responsive
Who answers the phone without voice-mail, or
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Who returns my call right away.
More bullet points
Who has a good online presence
Who has other listings in the area, so I know it wont
be out of their way to show my property.
I like to find the most aggressive people in any area. If I see
theres not a lot of inventory, and Ive got one heck of a good
deal, I may just turn it over to a realtor, because I like to work
several deals at once.
If Im working with one deal at a time, and its my very first deal,
I want to begin the process of advertising it for sale on Craigslist.
My ad is just a couple of lines with my phone number and a couple of pictures that somebody else took for me. Its really a great
way of getting a feel for any area.
If Im looking to wholesale a property because it needs a lot of
work, I would just advertise it on a basic site. eBay costs a hundred bucks to advertise a property for sale, and youll get a couple
thousand people looking at your property. If you decide to use
Craigslist, youll get a few hundred people in the local area looking at your property. Thats a wholesale deal. Youre in and youre
out. You might make 10%. You might make 40% on your money.
Im talking about selling your newly acquired property through
online advertising or a local realtor. Some properties sell very
quickly online but others with a high demand on the local market
may sell quickly and for good money using a local realtor. It is a
good idea to do an online advertisement before contracting with
a realtor just to see what offers you get. If youre just in and out,
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not doing any work and the property needs work, youre probably
going to have a smaller profit margin. By listing the property online, youll sell the property easier and faster, but if you dont want
to do any remodeling the profit margin is typically a bit smaller.
Ive bought properties where I send someone out to inspect the
property and report back to me. Sometimes the carpet has been
steam cleaned and everything is in great shape. Its literally a turnkey property. When they say turn-key property, take that with a
grain of salt, because every property needs something. When we
say turn-key, it usually just means its in pretty darn good shape;
ready to move in.
In reality, you may have a leaky faucet or a ceiling fan that
doesnt work. Until you turn on the gas, the electricity, fire up
the heating system, and test every faucet, and every shower
you dont know about all the minor things that may need to be
repaired.
If youre going to retail the property, youll have to do all the
repair work, but youre also going to make more profit typically.
If I hire a realtor to sell it, Ive got to factor in the commissions.
Im only going to do that if I have a huge potential for profit margin, and that would be more of a retail deal.
You may be wholesaling the property. Wholesaling is when you
sell below market value; youre in and then youre out. As soon
as I use a realtor, I consider that a retail deal.
If Im selling it wholesale, the price is going to be under market
value. Thats because I bought it so far under market value that
I can still afford to sell it under market value to my buyer and
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although I could do that with a realtor it usually happens quicker
selling it online.
On my sales end, its a winner for whoever buys it from me,
and its a winner for me. If someone else spends the time and the
money to make everything perfect, theyll ultimately retail it, or
live in it, or rent it.
Thats how you buy the property, and quickly turn around and
sell it.
Its A or B. Am I going to sell it retail, with a realtor, or am I
going to throw it up online and cut out the commissions? If youre
unsuccessful in a week or two, you may want to hire a realtor.
Take a small profit: 20%, 30%, or even 10%. Get in and get out,
and move on to the next deal.
If you bought it so far under market value that you can resell
it under market value, and you went through a realtor, what you
would know is that the realtor rarely gets to sell properties listed
under market value. That means your listing is probably going to
be something in his inventory that sells right away. Im telling you
the advantages of selling online but also there are advantages of
selling with a realtor. You shouldnt rule out either strategy.
My basic rule is the more money I put into the property, the
more money I want to make. The more time I spend on the property, the more money I want to make. If I could cut both of those
in half, I would make half the money because then I simply move
on to the next property.
This isnt scarcity. You can do several deals with quick flips in
the same amount of time another person takes months looking
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to make a huge return. Id rather take some money now and keep
moving forward to the next deal. Thats how I got the experience
and profits of buying and selling hundreds of properties.
Thats my particular individual investment strategy. Thats what
I like.
I give you the tools to find them and sell them, but I cant tell
you what your strategy should be because we all have different
requirements.
Take one of my students like Dr. Ira. His strategy is completely
different. What he wants is a nice property he can put a little
money into, get a good tenant, and rent the property knowing
every month hes got passive income from his rental property.
Thats his security because he knows, after X number of months,
that property is paid for in full. Hes realized 100% return on his
investment. Plus he still owns the property, and hes still getting
monthly rent checks. His investment strategy is more along the
lines of retirement and legacy.
Take a young college graduate, Dave Stall. Hes not in a financial position to be able to do the same thing, because he doesnt
have the bankroll. Dave has to start out small. He buys a lot for
$500 and then sells it for $2,000. His next move would be to buy
something in South Florida, one of the really cheap lots.
If he buys it for under $2,000 and sells it for $5,000, hes building incrementally. He then takes that $5,000 and buys two more
lots in South Florida and sells them for $10,000. Now he takes
that $10,000, and brings it back to Buffalo to buy a duplex, or a
single-family house and turns that into $25,000$30,000.
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Everyones goals are different. You might not want to be a landlord. If you have a property thats paying you rent, you enjoy that
rent, but your ultimate goal is just to resell it; not to get passive
income.
You have to have your own goals. I never tell someone what
they should do with their money. I tell them the way I do it and
what I would do if I were just starting out.
How is my system different than what everyone else is teaching
about real estate investing?
Most Systems Revolve around Borrowing Money

Most people arent really showing you how to find the deals,
and how to buy them for cash. Many real estate systems show how
to invest with:
No money down
How to buy on paper
How to leverage your credit
How to put minimal amounts down
How to borrow
How to do hard money loans
It all revolves around borrowing money.
What makes my system different is I show you how to buy
properties for cash no matter what youre dealing with. Most systems say if you have $10,000 to invest, then thats a great start as
a down payment. I show you how to buy two properties, how to
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buy three properties, and grow that $10,000 rather than taking it
and using it as a down payment. I dont know any other system
that teaches what I am teaching you right now.
For most people, its old school. Find a great deal. Borrow. Do
a second. Do creative financing. Hire a realtor. Pay all this debt
servicing. Pay all these third parties, and maybe theres a little slice
at the end of the rainbow for you assuming the market actually
goes up in value. This is the old way of doing things.
During a real estate market crash one little hiccup and your
whole down payment is gone. Youre under water. Thats how a lot
of people went belly up during the crash.
I thrived during the crash because I owned all my properties for
cash with no mortgage. I like to buy my properties outright. There
was no pressure to sell during the crash pressure to sell during the
crash, but if you borrow 90% of your money and the market goes
down 10%, what do you have? Nothing!
If you bought it for cash and it goes down 10%, youve still got
90% of your money, probably even more because I teach you how
to buy so far under market value. If the market goes down 10%,
you should still have 340% instant equity because of your buying
techniques and the fact that youre not borrowing.
I dont know another system that doesnt teach you to borrow.
Ive never been through another real estate training, but students
who Ive trained have, and they say most real estate courses teach
you more about borrowing methods than investing in real estate.
There may be another guy out there teaching what I teach, but
Ive never met him or heard of him.
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This is unique. This is how to potentially make huge profits by
investing in real estate without borrowing money and without leveraging your credit. Ive personally done that, but Ive never told
anybody you should max out your credit cards, and pull all the
cash out and buy real estate.
I actually saw that strategy online. A popular real estate guru
teaches you to sharpen your negotiation skills by calling all your
credit card companies and asking to get the biggest cash advance
you can, so you could pay him $60,000 for his training. Now, what
do you have left? He says, Ill teach you how to buy real estate
with no money, with no nothing. Yeah, you just used all your
credit to pay him the $60,000 for his training. If somebody was in
that position, I would say my training is not for you.
If you have zero, and you have to borrow everything you had
just to pay me, Im not the guy for you, because now youre in the
hole so deep that it doesnt even make sense to be talking about
investing in real estate.
I dont care if you have $2,000, $5,000, or $10,000. Theres a property you can buy right now for cash, free and clear. Let that be your
start. Dont try and leverage your $2,000 into a $200,000 house. Your
debt servicing, the interest youre paying, the taxes, the fees, and with
all the third parties involved, youre going to be on such a razor thin
profit margin, your chance of success goes way down.
Its the only system where you can get started

with as little as $5,000 or even $2,000.
I dont use the property I bought for $100 a couple of months
ago as a typical example, because sometimes luck still comes into
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play. I wasnt looking to buy that lot. I had no intention of buying
it, but when youre there and no one bids, youre thinking, Okay.
Ill take it for a hundred bucks.
It was a live auction. Nobody bid, and I just said, Okay. I
think Ill buy this lot for $100.
Even if I simply auction it off on the retail auctions sits, Im
virtually guaranteed to make a profit.
At the next auction three people may want it. It may go for
$2,000. You see, some things work when someones willing to pay
for it. Thats when being in the right place at the right time works
to your benefit. This is 99% about doing your homework.
When I went to that auction, I had ten properties I was looking
to buy. I had the info on them. I was not looking to buy a lot for
a hundred bucks. When there are more properties than bidders in
a room, these things are going to happen.
I remember in October at a live auction, there were 3,500 properties up for auction. Five hundred people were in the room. Every one of us would have to buy seven properties each just to buy
them all. Thats why I like live auctions. They take more legwork,
but nobody can argue with those numbers: 3,500 homes split between 500 investors.
Any time a property came up, we could all be selective. We
could all say, Im going to wait for the next property. What if it
was reversed? What if there were 500 properties with 3,500 investors? Automatically the prices are going to be higher. Sometimes
its simple economics. Thats what happens when you resell your
properties to a worldwide audience.
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Another hot tip Ive discovered is that if youve got 3,500 properties and 500 people in the room, chances are, by the end of
the day, half of those people are gone. They already spent their
money. Ninety percent of the bidders are gone.
Now theres hardly anybody in the room, and theyre still auctioning off properties.
I cant tell you how many times the last 15 minutes of an auction were the key to my success. Youve got to know, when the
rooms full, many are just there for a specific property. Theyre
only interested in bidding on the property next door; their mothers property; their uncles property. Theyre there for a specific
property. A lot of them are newbies. They get nervous. They buy
the properties in the beginning and then they go home.
What happens in the very beginning if you havent yet got the
property youre interested in buying? Youre more apt to enter
into a bidding war with a touch of auction fever. The price automatically goes up, but once you get the property you want youre
happy. You spent your money. You go home.
Now whos there to compete against me to drive up the price?
No one.
They say, Slow and steady wins the race. Dont get anxious.
Dont get too excited.
Its the same for online auctions. If youre doing an online auction thats in Florida and youre in California, you need to be up
at 6 in the morning if the auction starts at 9.
It could be an hour auction. It could be a 5 hour auction. One
day there might be 110 properties; another day there might be five
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properties. West Coast bidders participating in a Florida auction
like to put their proxy bid in on their properties the night before
the auction. Theyre not watching the auction. A lot of people
have jobs. Theyve got kids to take to school. They dont have time
to watch the auction every day which creates opportunity.
Keep Extra Dollars in Your Bidder Account

If you dont have enough money in your bidder account to meet
your proxy bids, then guys like me come in and, BAM! well take
it. I mightve had five competitors, but they dont have the money
in their bidder account, because they already won properties earlier in the day. Their money is exhausted. Thats why it makes
sense to keep a few extra bucks in your bidder account, especially
if youre looking to buy multiple properties.
Many people ask how these properties get put up for auction.
The people responsible for taking care of them are no longer in
the picture. Suddenly, theyve come to the end of the line, and
theyre being offered to the general public for whoever will pay the
most amount of money.
It doesnt mean its a distressed property. It doesnt mean its
a piece of junk property. It could be a diamond property that
someone bought for $250,000 during the boom, and they put
10% down or 20% and borrowed the other $200,000 or $225,000.
When the market crashed, the property was only worth $150,000,
so they walked away. It might be a beautiful piece of property, but
theres an old saying that, You dont throw good money after bad
money. Youre not going to keep filling that hole; keep paying
that mortgage, throwing your good money after bad money. A lot
of people walk away, and thats it.
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Now the bank is stuck with the property. Theyre on the hook.
Their mortgage shows you owe $200,000 on it. Its now worth
$150,000 to them too. Now even though its a beautiful property in perfect condition, its become an orphan. The bank is just
looking to minimize their loss and get the most money they can,
but theyre never going to get what theyre owed. They just want
to minimize their loss on the property.
The home owner has already abandoned the property. Hes
already walked, especially if its an investor. A lot of investors
during the boom bought multiple properties. As soon as they were
underwater, they gave up, since they didnt live there, and they
could care less about it so they let it go into foreclosure.
They just simply washed their hands of the whole transaction
and went along their merry way, never to think about that house
again. Its the banks problem. Now the bank has to do something
with it. Thats when they need investors like us, but were not looking to pay $250,000 for it. If its worth $150,000, were looking to
pay $100,000 for it, $90,000, or even $80,000 for it. Thats how we
make our money because now to us thats a gem!
The Condition Means Nothing

What matters is the percent of value that you buy it for. Now I
walk in. I paid $90,000 for that property. Its worth $150,000. The
bank was owed $200,000. The buyer bought it for $250,000, so its
just a chain reaction of loss. People usually say, Mike, dont you
feel bad? Youre capitalizing on peoples misfortune. The truth is,
if I dont come in and buy it, someone else is going to.
Its not like the house is just going to magically disappear into
dust, and the problem will solve itself. You cant feel bad about
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making money. I have a family, and I cant feel bad about the bank
making a bad decision to lend money on that property.
By the time the propertys gotten to that position, the real people who suffered the loss are long gone.
They may not have even suffered a loss, because they may have just
borrowed the money to buy the house. I see that all the time. Is it hard
to feel bad about the big banks that were just bailed out for billions
and billions of dollars? Is it hard to feel bad if they lose $100,000 on
a property? Its interesting. You see, the banks got bailed out.
The people didnt get bailed out. I couldve cried about it, and
said, Oh, thats so unfair. How do the banks get bailed out? How
do they get billions of dollars? Instead, my brain told me, Well,
I think I can make my money off the banks. Watch them lose
money. Watch me buy it. Watch me resell it.
Banks Are Not Real Estate Investors

Most people think banks are sophisticated real estate investors.
Thats simply not true. Theyre not property investors. They have
no idea what theyre doing. Most of the time banks dont even
know the market value of their foreclosed properties. Theyre simply putting it up for sale to the highest bidder at a foreclosure
auction so a bunch of vultures can pay pennies on the dollar for
it. Im strategically positioned to be the highest bidding vulture,
and win the property. Then I simply sell it for what its worth and
make the money on the fact that the bank didnt know what the
heck they were doing.
People ask if I often bid on properties that do not have a hidden
bid.
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Sure. It doesnt matter. To me, I dont care if its hidden. I dont
care if its revealed. I just care about pennies on the dollar and
percent of value. Thats it. Im focused and dedicated. I dont deviate. If I say Im going to pay $42,000 maximum for a house, and
it goes for $43,000, have a nice day; Im no longer interested.
Its dead to me, meaning I never think of it again. Its like Mr.
Wonderful on Shark Tank, as soon as he passes on a deal he says,
Youre dead to me. He doesnt even think about it again. Thats
how youve got to be. I dont look back and say, Oh, if I wouldve
only paid ... No. When does it end, a thousand more, ten thousand more, or twenty?
Decide what youre going to pay based on your concrete numbers
calculated from your research. Do not budge. Stick to your guns.
Thats why Im only successful on 10% of the properties I bid on.
Ive gotten into a bidding war when Im way below my maximum bid. Im sitting there, and Im going up at $100 a crack, and
Im battling it back and forth, but only up to my maximum bid.
Say were $30,000 below my maximum bid. Sure, Ive been at war
for 30 minutes, 45 minutes, going back and forth and still got
the winning bid $15,000 less than my maximum bid. When I say
dont get auction fever, what Im saying is dont get caught up and
start overpaying for a property.
Know When to Walk Away

Auction fever is not if its $20,000 under what youre willing to
pay, and youre battling it out for 20 minutes, thats no problem.
The second it hits your maximum bid, youve got to walk away.
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Thats what auction fever is. When your ego gets involved, and
you say, I dont want to lose this property, and you start making
bad decisions and bidding against what your homework tells you
to bid on the property.
When your maximum bid is below the market price youre willing to pay, you are virtually guaranteed to make a profit.
This is where a lot of people catch auction fever. They say,
I factored in $30,000 profit, so its okay if I make $28,000 or
$27,000. It just keeps dropping, to $26,000. Theyre justifying it
in their head, because now the egos involved. Twenty grand is
still better than nothing. Its not the higher percentage of auctions you win the better off you are. Absolutely not. I have a 10%
success rate. By most standards, thats an absolute failure to succeed 10% of the time.
If I was a baseball player and I got a hit 10% of the time, Id be
kicked off the team. As a property investor, youre sitting pretty if
you can be successful 10% of the time. When I use the term successful what I am saying is that I win approximately 10% of the
homes I bid on. as long as youve got a big net. Think of villagers
when theyre fishing. They dont fish with a net the size of a hand.
Theyre not using a goldfish net. Theyre throwing out a massive
net. They string it out 50 feet, because theyre just looking to grab
as many fish as they can but they will never get all the fish in the
sea.
Some will get through the net. Some wont. It doesnt matter, but
when they pull that net in, theres usually something there. If you
fish with a little goldfish net, you might be out there all day and get
nothing. Thats why 10% success to me is tremendous. I had a guy
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tell me, Mike, Ive bid on six properties. I havent won anything
yet. I said, Congratulations. I couldnt be happier for you. That
means youre doing it right! Youve obviously been trained.
I had another guy bragging that hed won four properties in a
row. He bid on four properties and he won all four. I thought to
myself that he likely overpaid on at least a few of those properties
unless he got unbelievably lucky.
CHAPTER 10 Summary:
The key to successful remote buying is to do your
research. Usethe online tools I taught you to make the
best calculated decision you can to get the history and
current comps about neighborhood property values.
Use realtors to get up-to-date information about property
values and a general sense of the neighborhood you are
interested in.
The condition of a property means very little. The most
important factor is the percentage of value you are
paying. That percentage must be way below market value
so you get instant equity when you buy.
Banks are not real estate investors and in most cases, they
do not know what they are doing.
Know your maximum bid and never deviate from that
number. Know when to walk away.
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STUDENT TESTIMONIAL
Thought the Cops Were Going to Arrest
Me for Stealing the Property!
Before Mikes system, I was able to do some investing,

mostly in the stock market and a little bit of FOREX, but
for the effort, it just wasnt worth it.
After Mikes system, I purchased six properties. They
are just lots vacant lots, in good residential areas,
next to great houses. I bought a lot for $1800; I sold it for
$2800. I made 40% profit and that was in just a month. I
sold another for $2,500 that I got for $1,600.
The first time I won an auction, I felt like I should be
arrested because I got such a good deal. I thought the
cops were going to arrest me for stealing the property!
If you want a quick flip, you can almost always sell it
for a quick dollar. You may get more if you wait several
months but in my position right now, Im just trying to
build up the cash and doing the quick flips is fantastic.
Paul, One of Mikes Successful Real Estate Investing
Students
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CHAPTER 11
How to Maximize the

Use of Realtors
Weve gone through several techniques and overviews about
buying and selling real estate. Weve touched on the auction process. As a beginner, you may not be ready to jump into an auction
just yet. This is when youll want to have the support of a realtor
in a specific area. In this chapter, I show you how to maximize the
use of realtors.
Most people are used to realtors, but the real question is: How
do you get them to work for you, and how do you have multiple realtors working for you that you dont actually pay?
Thats what they say, right? You dont pay the realtor.
Its important to understand that when youre buying a house,
the proceeds of those funds are paying the realtor. When youre
using a realtor, youre just submitting low priced offers to buy.
Thats called low-balling. Some of your offers will stick, some will
not. Ive made an offer with a realtor for 95% of the value, and
it got turned down. A month later, I offered half the value, and
it got accepted. Who knows how? Who knows why? The truth is
that different people are in different positions at any given time.
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With a realtor:
There could be an asset manager involved.
It could be a homeowner involved.
You might scratch your head and think: How did I do that?
You could see a hot listing thats been out for a day or two, and
think: Oh, my gosh, the price is great! Im just going to offer full
price, because what theyre asking is reasonable. I might as well just
put in a full price offer.
Dont Hesitate to Make a Full Price Offer

Let me give you an example:
In Phoenix, Arizona, there is a new community from Heritage
Homes. They are big builders in the area, and they deck their houses
out nicely with lots of extras. They have beautiful models with tile
roofs, all stucco, and granite. They really build beautiful homes.
In Phase One, a speculator comes in and buys the property right
from the builder. The builder wanted $239,000 as his base. The
buyer then put another $60,000 in glass showers and tiles that
look like hardwood floors. He pays $299,000 including $60,000 in
upgrades.
Then he puts it up with the realtor for $350,000. He wants to
make a profit. Its a brand new home, never lived in; hes a speculator. He didnt buy it to live in. He lists the property with the
realtor for $350,000. Unfortunately, this is 2007. He was a little bit
aggressive. Had he gone with a price of $325,000, he may have sold
it. But hes at $350,000 because his house is decked out. Now all
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How to Maximize the Use of Realtors

of a sudden the market value of the property is down to $299,000.
He put about half down on the property, so he had a little room
in there, but not enough.
In this example, he put down $150,000, he financed $150,000.
But hes saying, Oh, Im going to get $350,000. Hes trying to
make a profit. All this happens in the midst of the crash. Things
are going down, theyre not going up. So thats why when the
housing market is crumbling, you dont pay way over what other
properties are selling for. During a boom you could, but during a
decline thats not a good idea. Had this individual understood the
housing market, he wouldnt be in the position Im about to share
with you.
Now hes asking just $325,000. No response. A couple of months
pass, and hes at $299,000. No response. Now hes just out what
he paid for it.
Soon hes at $250,000, but hes chasing the market down.
Then hes at $200,000.
Now hes at $175,000, a year later.
Once he goes to $150,000 (thats what he owes the bank), hes just
hoping to break even, but hes still chasing the market down. This
completely decked out home with $60,000 in upgrades is getting
no response. At $150,000 he thinks he can break even. Remember
he wanted $350,000. This is in Phoenix in a great area with tile
roofs and stucco, and hes never lived in the house.
If youre ever in the area, go by and see Heritage Homes, The
Lakes at Rancho El Dorado. Theres a huge lake. Its a master planned community. The builder really went all out with
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beautifully landscaped roads, waterfalls, and trees. They took a
piece of desert and turned it into a beautiful oasis with huge palm
trees, club houses, and golf courses. Rancho El Dorado has four
golf courses and is considered a wonderful master planned community. Its absolutely beautiful.
Now hes at $150,000, just what he owes. Hes ready to lose his
whole down payment just to pay off the bank. He doesnt get his
$150,000. The bank forecloses. I come in and offer $69,000.
He initially asked for $350,000. I come in and pay $69,000, which
is just $9,000 more than his upgrades. I get the land and I get a
beautiful brand new home no ones ever lived in. Its a spectacular
deal!
Fast forward a year later and things are getting better. People are
starting to build again.
The builder wants $220,000 already for my model. For me, its a
buy and hold. Its the house I stay in when Im in Phoenix. Its my
buy and hold. Why get a hotel? I have a decked-out model home
with three bedrooms, two baths, in a phenomenal neighborhood,
its never been lived in. Every wall is beautiful, and the carpet is
brand new. The upgrades are even nicer than my own home.
He Didnt Understand the Market

When He Was Trying to Sell
This was not an auction house. It was a realtor house. People
put in offers for the property to Bank of America for $120,000,
$125,000, and $130,000. Bank of America was just being crazy.
They didnt want to sell it, but theyre chasing the market down
during the worst time there is. Now its a panic: What did I do?
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Bank of America lowered the price to 60,000 do you think I
offered 60,000? Do you understand how ridiculous they are at
$60,000?
I offered them $68,500. Thats $8,500 over the asking price. I
was determined to get that house! I understood what a ridiculous
deal it was, so I threw the asking price out the window. Sometimes
youve got to use common sense.
This place was a top of the line build. It had every single upgrade,
the glass showers, the carpeting, the padding, the raised ceilings,
not nine but 10-foot raised ceilings. Understand that he thought
the $60,000 in upgrades was free money, because he borrowed it
from the bank.
Now I see the builder wants $110,000 for a base model, without
$60,000 in upgrades. What was the research involved?
I see them building, so I walked in the sales office with the model
homes and asked, How many houses do you have under contract?
How many have you sold this month? Maybe eight or nine?
I see the little sold dots on their map that they have in the sales
office. Theyre trying to show you everything theyve sold. That
master planned community might have 2,000 lots. They built on
500 or 600 of them at the time.
Its not like Florida where you buy a lot, build a house and maybe
no one moves in next door for years. What happens in areas like
Phoenix or California, as builders come in, they take the entire
subdivision. Some of you dont know this, because where you live
theyll take the entire plot of land and they will actually build a
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single house on every lot. There will not be vacant lots in these
planned communities.
When I stepped into an area like Rancho El Dorado with golf
courses, beautiful landscaping, and a country club, Im thinking:
Are you kidding me, youre asking $60,000?
I showed up the first day it was listed new, and there were eleven
offers that day. There was a stack of business cards on the counter,
so you can see that many people have been there.
This is one example of me using a realtor to my advantage.
I went directly to the realtor that was selling the home. This increased my chances of being the high bidder because he was working as both the buying and selling agent making both sides of the
commission.
Lets say that:

Realtor A is selling a house.
Realtor B makes an offer.
I come to Realtor A directly with an equal offer.
Somehow mine gets accepted.
Maybe:
My offer comes in, and it somehow goes to the bank
right away.
The next day, two days after they accept my offer,
Realtor Bs offer appears at the always remember timing
is extremely important in the real estate business.
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People will do what they need to do to make more money for
themselves. Its human nature.
Some realtors may be out to lunch when the offers come in.
(Would you rather get 6% on a deal or 3% on a deal?) I know this,
so I go directly to the listing agent.
I saw 11 different realtor cards on that counter, so I know 11
different realtors are most likely submitting offers.
Ive experienced both sides of this:

Ive had a realtor submit offers for me, excellent offers,
which are above the asking price.
My offer isnt accepted and I see they sold to someone
else for less.
How is that? Because having good relationships with realtors
and allowing them to make both sides of the deal has proven to
be effective.
How to Select a Realtor

Let me share something valuable I use all the time.
The site I like to use is Realtor.com. The information may be old
at times, but its certainly going to give you an idea of any city you
need to know more about. Lets use Oklahoma City for this example. You may know absolutely nothing about Oklahoma City. So
lets try an example.
Go to Realtor.com and type in Oklahoma City to start your
search. Do this right now. Follow me on your computer, so you can
learn while doing instead of just reading.
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Right on top it will give you all of your options:

The location is Oklahoma City
No minimum
No maximum
All bedrooms
All baths
Homes for sale
You want to see what the caliber of properties on the low end is
like. This will tell you everything you need to know, so choose:
sort by low to high.
Because this is for research purposes, youre trying to find out
about single family houses. You dont need to know about mobile
homes, farms, land, or multi-families because youre just trying to
learn about the area.
How to Learn about an Area by Viewing

Information on Your Computer
When youre searching, you want to see curb appeal. Square
footage isnt necessarily important. Lets take it one step further,
and go to additional features. Maybe theres a lake or a city view.
When you get proficient at this type of research, you can even do
it on your smart phone.
You can:
Go to the minimum-maximum appraised property
status
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Look at new home communities
Look at new homes
Look at foreclosures
Find out:
What would $100,000 get me in this city?
Is the curb appeal good?
Lets say:
You have family in Oklahoma City, and you want to
buy there. Or you may simply have found by doing the
research I have already provided that you are interested
in the city and want to learn more.
Youre looking for something in the $60,000 to $80,000
price range, and you want to know what kind of
property that amount will get you. How far will that
money stretch?
Youve just discovered that your money may stretch
much further in S. Florida because the low end homes
are not nearly as nice as what you can get for the same
money in other areas.
Its not going to touch what you could get in Phoenix
or Vegas for the same money.
At this point, you havent seen the value of investing
in Oklahoma City unless you live there or have other
motives. If you looking to invest remotely the bang for
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the buck would be in other areas so do another search
and see what appeals to you as a percent of value.
You can search different areas. Just plug in any city and see how
it compares to other cities youve researched. You could take 50
cities you have an interest in, and do exactly what you just did.
Sort them by:

Their asking prices, or their age
Square footage
If youre looking for land only, select land
Everything you need to know is right there:

Type of property
Specific area
Bedrooms and baths
Active listings
Open houses
You can search by builder if you really wanted to.
You may also want to choose foreclosures only. When youre analyzing an area, look at retail sales, but also see whats out there for
foreclosure to get the best idea of the area.
Sometimes the little snapshot you see when you click any property will tell you everything without digging much deeper.
Oklahoma may not meet my criteria, but you may like the demographics. Perhaps you have family there.
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Any Market Can Work for the Right Reasons

For me, Oklahoma City would be an uphill battle. Im flexible
on square footage. If the house is small, but has good bang for
the buck, Im interested. Larger homes tend to turn me off, because remodeling a larger home is more labor and cost intensive.
Smaller, newer homes are going to be a lot less work.
To select a realtor:
Find a house youre interested in, and youll see the
realtors name right on the listing.
Call the realtor, and ask them what other properties
they have in the area.
Pick their brain for free, because theyre the experts in
the area.
Ask them, Whats on the cheap end, or what do
you have as a pocket listing? They love hearing that
question.
A Pocket Listing is a property for sale that is not on the market. It means they have a friend, or a friend of a friend that wants
to sell but does not want it listed. Thats their secret house.
You would start off by asking, Do you have any pocket listings
in the area? Im trying to buy something in Oklahoma City.
They may say, Oh, Ive got this one.
Then ask them, What properties are you actually listing right
now?
Theyll say, Oh, Ive got this, this, and this.
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You reply, What do you think the best deal would be?
Dont be Afraid to Ask What They Think

It doesnt mean youre going to put any weight in their answer,
but its great to hear what other people have to say, especially if
theyre a realtor or broker in that specific area. Theres no risk.
You can call every one of the realtors and get them to:
Take pictures
Do research
Send you listings
And it will cost you nothing
How do you like that? You can get unlimited research on any
area paying absolutely nothing, because these are the experts and
they want your business.
Oklahoma City is not for me. Theres no bang for the buck.
But, its a great example to see what is available.
One time while I was surfing Realtor.com, I discovered a little city called Maricopa, Arizona. You can use that city as your
search and compare it to Oklahoma City.
Lets say youve done the search and found a house you want to
buy in Maricopa, Arizona.
What do you do next? Go right to the realtor and start digging
in. Start putting in low-ball offers.
If I want to test and see how aggressive the realtor is, Ill put in
an offer at a low price or as I like to say a low percent of value.
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You have nothing to lose. Put the offer in and see how they come
back. Do it 10 more times, call the realtor directly. Youre paying
nothing. Its a great way to learn the process and solid information about the local market.
Maximize Realtors by Going Direct, because

They All Want More Commissions
If you want a Realtor to represent your interest in a
certain area, heres how to do it:
You can have different realtors working for you. Just have them
send you a contract, and sign it. It doesnt mean you have to buy
all the properties you put offers in on, see what comes back as the
lowest percent of value now that you have the tools to determine
property value. But what if one gets accepted at a great price? It
might not have been your first choice, but if its an amazing deal,
it might become your first choice.
The alternative is that if you called an individual realtor and they
really stood out above everybody else. You might want that one individual to take care of all of your needs in the area. Have that one
realtor you really liked submit the offers for you so you dont have
to go direct.
Ive found that sometimes youll get more responsiveness from
the realtor by going directly to the listing agent because theyre
getting double the commission. Theyre the selling agent, and
they represent you as the buyers agent. In this case, theyre getting both sides of the commission; the buy side and the sell side.
This is great motivation for the agent. Theyre supposed to treat
every offer the same and submit every offer the same, but it is
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human nature to try and get double commission instead of half
the commission.
Theres a lot of value in Realtors:

Just because you have a realtor doesnt mean youre
automatically paying retail for a property.
You can still make offers.
You can still low-ball.
You can still apply these techniques to figure out what
its worth and bid accordingly rather than bid at an
auction.
Youre placing your bid on paper and its just a longer
process.
Its going to have to go through approvals.
If its a short sale it could really be delayed.
If its a straight sale it could be a little quicker, but it
really all boils down to finding the best deal for you.
Youve got to deal with title companies.
When dealing with realtors youre going to have to deal
with counting on other people to send various documents,
fax that, or the are calling you up, saying, I need this
document, or now I need this from you. Remember this all
takes up your precious time so use realtors in conjunction
with the auction process to find the very best deals.
Sometimes people get frustrated with realtors because of all
the paperwork involved. Once you see that doing it through a
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foreclosure auction is quick and painless, it seems like a no-brainer
to just do it yourself.
You dont have to sign any documents to buy the property.
When you pay for the property, youre going to have
proof of ownership just mailed to you.
Realtors are good if youre just looking to get one or two properties, nice houses in a specific area. If Im looking at a new area, I
may start off with a realtor. But, sometimes I want to test it myself.
I just want you to understand all the different ways you can invest
in real estate.
When you have an area that goes ridiculously well during

the boom:
A lot of speculators come in
Theyre throwing up way too many houses at once
Theyre flooding the market
When the market goes the other way:

Theres brand new inventory thats been built
Lots of people cant make their payments and go into
foreclosure
Theres an oversupply of new houses
Its simple supply and demand. When the market
booms there are more homes built, when the market
crashes there is more opportunity to get the previously
built homes at a steep discount because supply
outweighs demand.
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After youve remodeled over a hundred homes that are 50+
years old, like I have, you start to appreciate newer builds with
nice double pane windows, a new roof, new electrical wiring, and
new plumbing. Remodel a few houses that are 50 years old and
youll know exactly what I mean.
When people are talking to you about older houses, they will use
buzz words like, This house has a lot of character.
Characters great if Im going to live there myself, but Im more
interested in knowing:
If the house is built in the last few years
If the roof is good
If I have to paint and carpet the property
When Buying Any Property, You Have The Ultimate
Security If Its A Newer Home
I apply my criteria that way, because I want to get newer homes.
I want to find areas that have been over built.
Some people say, Well, what about Las Vegas?
Heres how I would compare Vegas to Phoenix.
Phoenix has:
A lower unemployment rate
Looking at infrastructure, Phoenix has more corporate
headquarters and the prices are pretty close to Vegas
on an apples to apples basis.
American Express has 8,000+ employees
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USAA has a major corporate presence
Walmart has over 30,000 employees
These are the type of facts you want to hear about a particular
area. You want to hear that there are big companies, and theres
low unemployment. All of this is really irrelevant if youre still over
paying for a house. These are just things that may help you make an
informed decision.
Lets say you read an article that says, The Oklahoma City unemployment rate is down to 2%.
That might prompt you to at least look into it.
Youre thinking: What different areas have the best opportunity?
Then you look, at a particular area and realize theres no opportunity. Its alright, at least you tried. You did your research and
looked into it.
Dont Leave a Market Thats Going Well Until

You Can No Longer Meet Your Goals
Im not trying to invest in properties all over the world. I like it
to be easier on me. But, I certainly see the value in Realtor.com.
Even though I love the auctions, I can also see the value in having
other people working for me. Theyll submit offers; theyll do all
the grunt work sending documents back and forth. I can low-ball
the offers and theyll get approved or they wont get approved.
The bottom line is this: Because of this tool I just shared, you
can start putting in offers right now.
If you feel a little apprehensive that you dont want to jump right
into an auction, use any one of these buying techniques that Ive been
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teaching you. There are many different techniques when it comes to
real estate. There are many different ways you can attack this and
many different ways you can make massive amounts of profit.
Back to Maricopa, Arizona

Now go back to your search in Maricopa. Maybe you are noticing that every place in Maricopa is looking pretty good. When
you pulled up Oklahoma City, what were your choices?
The places in Maricopa are:
Newer and less expensive.
Showing better curb appeal, tile roofs, and stucco.
Nicer houses all together.
Imagine youre selling online. Californians love tile roofs and
stucco. It makes them feel like theyre at home. Arizona homes
look as though they could be California homes. It would be just
like a smaller neighborhood in California with the tile roofs and
all the stucco. A lot of people can relate to this style and design
of housing.
If you search the same home in California,

good luck finding any one of those deals, as the
market in California is going up right now.
When I first found Maricopa, Arizona, it was somewhat untapped. Id never heard anybody mention it. I was actually searching Maricopa County, and I stumbled on Maricopa City. I didnt
know there was a Maricopa City. Id never been there when I
started researching and buying properties.
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You dont want to spend money traveling to all these places, thats
what computers are for.
Everything You Need to Know Is Online

Realtor.com is a phenomenal tool because it doesnt just recommend realtors; it gives you the research as well. Its pulling from
the Multiple Listing Service, and it gives you a snapshot without
paying any subscription fees.
If youre looking to maximize the use of a realtor, my advice
is to go direct. Go right to the source. You may want to hire one
realtor to talk to another realtor. Thats two people fighting over
the same commission. Its not a problem. If youre loyal to one
realtor and you want him/her to put out 20 offers, you may have
some level of success. But if you call the 20 realtors directly, see
what your result will be as opposed to having one realtor go to 20
other realtors. Test it yourself.
CHAPTER 11 Summary:
If there are multiple offers on a property, it may benefit
you to go directly to the listing agent, rather than through
another realtor.
Use Realtor.com to compare the value of investing
in different areas. Look for curb appeal, and look at
foreclosures as well as retail sales.
When selecting a realtor, ask them about their pocket
listings (properties that are not on the market). Dont be
afraid to pick their brains and ask them what they think.
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69 Easton: Bought for $18,000
Sold same day for $69,995
This was a great quick flip. I bought it as a foreclosure through

a realtor. The reason I sold it at such a high price was because
the previous owner got some kind of settlement and they really
went over the top remodeling the inside. It was gorgeous. It
was a duplex and the owner converted it to a single family
home, so it was HUGE!
This home is located in a good, solid middle class
neighborhood about 3 miles from the University of Buffalo.
I didnt have to put any money into this property as the
previous owner put their money into it and couldnt keep up
with their house payment. Then, for some unknown reason,
they went belly up. I came along and bought it for $18,000.
The way it was able to sell in 1 day is because I had a 30 day
close and I was able to advertise it and have a buyer lined up
to close the same day it went into my name.
Using my online selling techniques I was able to quickly sell
it for $69,995, making a nice profit of almost $52,000.
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CHAPTER 12
How to Open and Fund

Your Bidder Account
If you are going to bid at auctions, youll need to register by opening a bidder account. Its quick and easy and I encourage you to do
this with me right now even if its just for educational purposes.
As I walk you through this process, you may think it is very
simple, but know that it took years and a lot of diligence to learn
these things in order to teach them to you. Lets use just 1 example
to make it simple. I will show you how to open a bidder account
in Lee County Florida.
First, go to: www.lee.realforeclose.com
Next, click where it says: REGISTER
Youll see a page that says:
Welcome to the Registration Wizard!
The next few steps will easily guide you through the
registration process.
In order to complete the registration process, you will
need the following information:
1. Contact Information
2. Mailing Address
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Click Next to start the wizard
Youll fill in the basic information:

Company Name
First Name
Last Name
E-mail
Confirm E-mail
Phone
Click: Next
Youll come to a screen that asks for:

Nickname
Name on Title
On This Page People Get A Little Confused Everybody knows
how to enter their name and their address.
But what you need to know is: The nickname is the name of your
bidder account. Not the name that goes on the title.
You may call it, IRA bidder account. The nickname is simply
what you would call it so that you know which account it is.
If you had multiple accounts, you would just want to know at a
quick glance:
If you were using a self-directed IRA to purchase these
properties, you would want to open a separate bidder
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How to Open and Fund Your Bidder Account

account for your IRA, or a separate account for your
kids educational account.
If you are doing it in your own name, you might want
to make it your own personal bidder account.
If you were doing it for your corporation, you might
want to do it as its own bidder account.
Enter a Nickname, and click: Enter
You could also have one bidder account and simply change the
name on the title. So this is one thing that is very important to
understand. Im not just showing you how to open it, but how to
be able to actually start bidding.
What happens is:

Whatever name you put on the title can be changed at
any time up until the time you bid.
Once you bid, whatever name you had in there at the
time you bid will be on the title.
If I wanted to bid on a specific property and I want
it to go into my corporation, I would put: XYZ
Corporation.
If there is a property on another online page of the
auction that I want to bid on, and I want it to be in
a different name, I would simply put the other name
where it says: Name on Title.
Type in the name you want on the Title, and click: Next
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Now youll be on a screen that asks for your: Mailing Address
Enter your address, city, state, and zip code, and click: Next
The next screen asks for your:

User Name
User Password
Security Question
Security Answer
Find a question on the list that you will remember the answer
to easily.
Once youve done this, click: Next
Now, youll arrive on a screen that says:

Thank You for registering with Real4Close.
You will be able to use the same username and
password to sign in to any of the Real4Close
foreclosure and tax deed auction online sites.
You can modify any of your information by selecting
My Account from the Left Navigation menu.
For Security reasons please log out when you are not
actively using the site.
Thank You.
Click NEXT to be automatically logged into the site.
It will bring up a bunch disclosure pages for you to read.
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Read the page, and click: Okay
Read the next page, and click: Okay
Keep going until youve read and agreed to all the terms and
conditions.
Now that you have your bidder account set up, you are ready
to get started.
Next, go to the Calendar tab on the top left where it says: Bid
Menu
When you click on any given day of auction, and you go to

place a bid, it will show:
Your nickname
The name of the title (the name thats on record)
Let me share a little trick with you:

Click on the left hand side where it says: My Account
It has all your information again and almost looks like
exactly what you did when you registered.
But now you have two different things you can change at
will:
1. Manage E-mail Notifications (Auction Results). This allows you to set up a primary e-mail account as the default
and it will automatically receive Auction Result Notifications. If you win an auction and you werent available to
take action on the bid result (because you were busy or out
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of town), it will notify a friend, partner or an assistant to
wire the money for you. It will send them an e-mail when
you win the auction letting them know to initiate the wire
for you. Thats a pretty cool feature.
Something Really Important Is

Right under That Feature
2. Manage Aliases (Names on Title). Youll see the ones you
entered when you registered.
If you click the blue link that says: Manage Name(s) on Title, it
will open up a mini screen. At the top left there is a blue link that
says: Add New Item
Click that link and it clears the info you entered before and allows
you to add a new:
Nickname
Name(s) on Title
Address
City
State
Zip Code
Once youre done filling it in, click: Save
This allows you to save multiple accounts or account names so
you dont have to reenter it every time.
Fill in all the info and hit: Save
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If you want to go 50/50 on a property with someone:
You would simply add their info into your profile and add them
into the deal before you bid.
Now if you save it and you bid on a property, your nickname and
name on title are saved. You can save multiple names in your account so your not having to constantly re enter this information.
The only thing I need to clarify is:
Change the Name Before You Bid

You cant go in after you win the bid and change it. If you want
to bid with somebody, or if you want it to be in a different name,
be sure to do the name change before you start bidding.
If you have another bid right after that, you can do it again in
a different name. You can change it for every transaction, and if
you have several corporations or different people you want to buy
with. Just make sure you change it before you bid.
I just shared:
How you open your bidder account
How you put the names on the title of properties you win
at auction
How to have multiple names titled on the deed of any
property you win.
I want you to know the different options available to you. If you
want to have multiple bidder accounts, because your funds are
actually separated, meaning you do not want to commingle funds
145

in a self-directed IRA with your personal funds, or funds in a corporation, this is where it makes absolute sense to have different
bidder accounts.
I trust you will use this valuable information.
How to Fund Your Bidder Account

Now that you have your bidder account set up, the next step is
to fund your account with money so you can bid on properties
you are interested in buying.
Three Ways to Fund Your Bidder Account

There are three ways you can fund your bidder account.
Option #1. You can show up in person with green cash. I dont
recommend this funding method. Why would you want to waste
your time traveling there to bring green cash? Its possible. You
can do that.
Option #2. I also dont recommend this, but some people prefer cashiers checks. You can overnight a cashiers check to the
county. Now youve got to pay cashiers check fees, unless youre
a preferred bank client.
In order to use this method, youve got to physically go to the
bank, and get a cashiers check. Youve got to take your cashiers
check to an overnight company; something like Fed Ex, UPS,
DHL, or even the post office. Then it has to be overnighted. These
things take time, but its a method.
Option #3 is my preferred method and the easiest one. Its a
basic wire transfer. Once you set up your bidder account, theyll
146

give you whats called wiring instructions. If youre still a little bit
old-school, you could bring those wiring instructions in person to
your bank. Tell your bank to please wire X amount of money to
the county giving them the routing number and account number
given to you, click the option to fund your bidder account. This
routing number and this account number is how the funds end
up in your specific bidder account. Be sure to include your bidder
account number which is also given to you at the time you register.
This is all very easy.
With the power of the Internet, sending wires is very easy. It
takes me about ten seconds. I input the routing number and the
account number, and then I determine the amount of money I
want to wire. One click, and the money is in my bidder account.
Thats it.
For me, the path of least resistance is to fund my accounts by
wire transfer. You can bring green cash, or a cashiers check, or
mail a cashiers check, but what I prefer is the wire transfer.
As mentioned before, most counties (and most live auctions),
are going to want 520% of the amount youre going to bid in
your account. Lets use Lee County, Florida as an example again.
They require 5%. If youre looking to buy a property for $50,000
put $3,000 in your account. Have a little extra for closing costs
proper. Money in your bidder account can also be used to pay the
balance when you have the winning bid. Or you simply click one
little button on the website, and you can get a full refund at any
time.
Now your funds are on deposit. It means when you log in, youll
log into your bidder account number and the first thing you see
is that your funds are on deposit. Its just like when you log in to
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your online bank account. (If youre not doing online banking,
you need to do it.)
Dont hesitate to put more money than you

need in your bidder account. Heres why:
Now and then youre going to find a gem of a property that
nobodys bidding on and its probably going to be for pennies on
the dollar. If your moneys not in the bidder account, youre going
to miss out. If you want a refund, with no fees and no questions
asked, you click the refund request button. It asks you how much
you want to be refunded. You put in the dollar amount and your
money is refunded.
After doing your research, youve decided on one property you
want to buy. Youve also determined your maximum bid is going
to be $50,000. You only have $2,500 in your bidder account. The
property you are bidding on might be worth $160,000, but you
will not be able to bid anything over $50,000, because you only
have $2,500 in your account. You will be limited to 5% of your bid
amount, so dont hesitate to put more into your bidder account.
How Much Money Do I Put In My Account?

Lee County, Florida, requires a 5% deposit of what you expect each of your maximum bids to be. If youre looking to buy
a property for $50,000, youll need a minimum of $2,500 in your
account.
It is important to remember that I constantly teach you not to
get auction fever. Dont overbid. If youre really looking to pay
$50,000 for a property, I recommend you put at least $3,000 in
your account. This way youll have a little room for closing costs.
148
CHAPTER 12 Summary:
Using the information Ive given you, you can quickly
and easily open a bidder account.
You can use different Nicknames for different bidder
accounts.
Remember, change the Name on the Title before you bid.
149
STUDENT TESTIMONIAL
This is my first real estate experience and I
didnt have a lot of money to invest. Mikes system
makes that possible!
The reason I was interested in Mikes course is because

this is my first experience in real estate, and I dont have a
large bank roll to invest. Thats what drew me in to buying
his after training with Mike, I was able to purchase my first
property and make a $15,000 profit.
Mike is very honest, very transparent, which I like,
because honesty for me is everything. His integrity shines
through.
One of the things I loved learning is that I am now able
to purchase property remotely. This is important for me
because I live in the northeast, and being able to purchase
property from a remote location is everything to me.
Youre going to love this course, because Mike is
genuine. Hes heartfelt, hes authentic, and he gives you
110%, and its all done in a friendly atmosphere which is
very inviting.
Nick, One of Mikes Real Estate Investing Students
150
CHAPTER 13
What Happens after You Win

a Property at Auction?
Now, all of a sudden, youve won a property at an auction. What
happens after you win? What are the precise steps after youve
won? Youve gotten THE GREEN SCREEN. If youre watching
my DVDs, you know the GREEN SCREEN means youre the
winner. Its over. Your bid won.
The first thing that happens is 5% of your bid amount immediately comes out of your bidder account. The next thing that
happens is within 24 hours from the time you won the property;
you must pay the 95% balance due. Again, you can bring green
cash. You can overnight a cashiers check, but now youve got a
time crunch. Youve got to hope your overnight delivery company
delivers your cashiers check on time. You just got a smoking hot
deal, and now you want to send a cashiers check? You want to
rely on an overnight company showing up on time to fulfill your
24-hour commitment?
Not me. Im going to wire the money. It takes me a maximum
of 35 minutes online. When I send a wire. The money goes right
into the countys website escrow account, directly into my bidder
account. No matter how much money you have in your bidder account, the county will never withdraw that last 95% without your
authorization.
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What If You Have Buyers Remorse?

Lets say that for some reason you have buyers remorse. Maybe
you changed your mind. Maybe you think you overbid. Whatever
your story is, you dont have to worry about them just arbitrarily
taking the money from your bidder account.
Theres a secondary step. The 95% is due within 24 hours.
Whether you have a dollar or a million dollars in your bidder
account, you need to log back in and authorize the transfer of
the balance from your bidder account. You simply authorize that
transfer. Boom! Ten seconds later its out of your bidder account.
11 Days Later, You Get the Deed

Youve now fulfilled your obligation. You know whats going
to happen now? Eleven days later, you get the deed. Theres no
signed paperwork. Theres no overnighting back and forth. I dont
know if youve ever dealt with a short sale or a traditional sale,
but theres a stack of documents. You need to sign. You need to
notarize this, and notarize that.
Time is money. If I have to spend ten hours to process a transaction, thats another three to four thousand dollars I have to
make, because I just spent ten hours on it. To me, time is money.
Thats why I prefer the wire transfer.
The Key Is to Take Action!

Action is your #1 priority. If you want to dilly-dally, or second
guess yourself, other people are going to get those deals. Youve
got to understand, there are people out there that are ready to
take action.
152
What Happens after You Win a Property at Auction?
The Bid
If youre not ready to take action, its going to be hard for you
to compete against somebody who is. Now youve won the bid and
paid your 95% balance due. It took a couple clicks of a mouse.
Theres no signed paperwork and no faxing back and forth, no
person to talk to. You will have the deed in about 11 days in the
mail.
You dont need to show up. You dont need to call anybody. You
dont need to verify anything.
The Deed
Some people ask, How valuable is the deed? The deed simply
says that youre the owner. that deed can be accessed online. That
same information is public record.
I dont need to call the county. They dont even need to mail
me the deed (even though they will), because the deed is just a microfiche of the fact that the property went into my name. If I can
go online and verify that the property is in my name, thats good
enough for me.
When the deed does come in the mail, I simply throw it in the
file.
What Do You Do When You Sell It?

When you sell it, do you have to mail that deed to whoever
bought it? One of the things I teach is how to simply recreate the
deed when selling your property.
153

When you buy a property at an online auction, the county puts
the property in your name within 11 days. The deed you get in
the mail is basically a receipt showing the propertys been transferred into your name. You can sell it the same day, the next day,
or whenever you decide to sell as long as its in your name. Dont
hesitate. You can sell the property immediately or hold it as long
as you want.
Lets go through the process of what you need to do when reselling properties. What I do to save time and money is go to websites like documents.com or lawyers.com. For about $10 I get a
deed and print it out.
You simply fill in the blanks with the sellers name (your name),
and the buyers name. Then you have it notarized. The buyer signs
nothing. If you give me $100,000 for this property, I simply create a deed. These documents are all online. Lawyers have created
them. Theyre great. They make it extremely user-friendly. Whats
the sellers name? Whats the buyers name? Whats the property
address? You can always work with title companies if you prefer
but if your selling a piece of land for $5,000 that you bought for
$2,000 it may be more cost effective to just create the deed yourself and mail it to the country recorders office for filling.
Theres one thing you still need and that is a notary. Every time
I sell a property, I still have to get the deed notarized. In New
York, you show up at the bank and they have a notary on site. In
California, you show up at a UPS store or a notary. UPS stores
typically have a notary. Each state handles their notaries slightly
differently. Some areas you pay for a notary and some areas its
done as a courtesy at your bank.
154

After the deed is notarized, you simply mail it to the county,
or if youre right there, if its in your own backyard, bring it to
the county. Have them file it for you right then and there. Its very
simple. Or, you can mail it in. I cant tell you how many times Ive
been in California, sold a property and mailed the deed to to the
county recorders office in the area the property is located.
Youve got to mail it to the county, because they have to file it,
just like the county did when you won it at auction. When you
received that document in the mail, it was a result of them actually filing it. Filing it is the key. Think of the deed you receive as a
receipt, because the county records are whats most important. If
you brand new to real estate it will probably make more sense to
allow a professional to do this for you. Once your experienced you
may find it more attractive to save those fees and do it yourself.
If you are experienced and youre like me and you like to cut
out the middleman, then print out the deed, fill it out, notarize it,
and mail it to the county with instructions to mail the deed to the
address of the new owner.
If I were to take the time to try to explain how it works in all
3,000+ counties, this report would look like a phone book. I only
use Lee County as an example because I have done this on millions of dollars in transactions. Lee County, Florida, as our example. When I send that deed to Lee County, I instruct them to
send the filed deed to my new buyer. Thats it. It comes right from
the county, straight to the buyer. I save the 49 cents for mailing it
and the couple of days it would take to ricochet from the county,
to me, to the buyer. The county sends it right to the buyer. Thats
the end of the story. The property is now transferred.
155
Are There Enough Foreclosures for Everybody?

I am often asked if there are enough foreclosure properties to
sustain all the real estate investors looking for good deals.
I remember a guy was telling me, I dont think there are any
more foreclosures out there. I said, Well, do you think that suddenly every single person in America is going to pay their mortgage? He kind of laughed. He said, No, of course not. I said,
Well, what happens if you dont pay your mortgage? He said,
The banks going to foreclose. I said, You just answered your
own question.
There Are Always Foreclosures,

Even in the Best of Times
During the real estate boom there were so many foreclosures,
they couldnt sell properties fast enough. Even in areas where there
was very little inventory, there were still foreclosures. It doesnt
matter if the market is going down, going up, or sideways.
Its easy to see the real estate market is improving right now, but
understand there are still thousands of foreclosure that are being
auctioned off every single day. My job is to show you where to
find them.
The fact that more and more public records are online around
the country (Florida has one of the best open records law in the
country), is just making the process easier and easier.
Thats one of my specialties. I like to show you how to do this
remotely, from your computer, anywhere in the world. Now you
156

can actually purchase properties from the comfort of your own
home, doing your research online.
The online availability of public records is incredible. More and
more counties, and more and more cities are putting these property auctions online, because theyve realized by putting everything online, they have a broader reach.
For people like us looking for these deals, there are more opportunities than I could possibly buy. If I was the richest man in
the world, I couldnt buy all of the available properties. If the ten
richest men in the world put all their money together, they could
not buy all these foreclosures. There are just too many of them.
CHAPTER 13 Summary:
The precise steps you need to take after youve won a
property at auction
The importance of notarizing the deed
How to save yourself money by doing the deed transfers
yourself. This is only what I do, you may find it easier
to just hire a title company to do this for you. Once you
understand the process fully, you may want to start to do
this yourself.
There are always plenty of foreclosures no matter what
the market; boom, bust, or sideways.
157
92 Roosevelt: Bought for $7,000 Sold less than two
Months later for $58,000.
I bought this property for $7,000 through a Buffalo tax

sale. It looked a little ugly, so I put a total of about $15,000
in renovations into it which put my investment at around
$22,000, and then I sold it for $58,000, giving me a profit of
about $36,000.
This old style single-family home was a nice 2-story,
5-bedroom, 2-bath property with a screened-in porch that
sold in just two months.
Its a perfect example of how to get a super low price through
a tax deed auction, and how to quickly flip it with room to
make a handsome profit.
158
CHAPTER 14
Researching Auction Property

from the Foreclosure List
For every auction, an accurate list of the foreclosures is posted
approximately six weeks in advance. In this chapter, youll learn
how to pull the foreclosure list so you can do your research to determine if there are any properties you want to bid on.
Believe it or not, people will try to charge you to pull the foreclosure list so you can see what foreclosures are being auctioned. Its
very common. Theyll compile the list and charge you a monthly
fee for this service. Most people dont realize you can pull the foreclosure list yourself for free. Heres how to pull the foreclosure list,
and how to analyze it.
In this example we will use the foreclosures in Florida. You
would want to go to the website RealForeclose.com.
When you browse the site you will see how many counties in
Florida are now online.
For this example, lets use Lee County, Florida.
Type in Lee.realforeclose.com.
Now, you will find yourself on a page specifically about Lee
County. Youll see three different tabs, since I already showed you
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how to set up your bidder account, you are now ready to start
pulling the list.:
Start Here
Register
Calendar
If you click on CALENDAR, youll see an actual calendar that
shows every auction for the current month. If you change the
month, youll see all the upcoming auctions for the next month.
By clicking on a specific date, the foreclosure list for that day in
Lee County, Florida, pops up. Isnt that great?
It gets even better.
On the bottom left side of the Lee County page, youll see a tab
that says, Jump to. All the Florida counties are now available
and this list is growing at all times. Perhaps youre interested in
Broward, Charlotte, or Duval. All the counties are there.
For this example, lets stay focused on Lee County. If youre
doing what Im sharing, youre already there.
Now lets focus on the auction calendar. Spend a few minutes
on this page and become familiar with what happens when you
click on a specific day.
You dont have to pay for a foreclosure list; you can just pull it up
yourself.
From one county on the foreclosure site, you can jump to any
other county thats listed on that bottom left corner.
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Researching Auction Property from the Foreclosure List
Auction Property Search

Be sure to match up the entire story of your property with public records. You might have to re-read this a couple of times, but
its very simple, and its just a chronological timeline. Lets look
at the official records, and break it down into really simple terms.
You want to see that history on each property your interested in.
How to Research Public Records Step-by-Step

1. When looking to purchase a foreclosure through auction you
want to search the public records to make sure your making the
right decision. I spend a lot of time in my DVD set because this is
much simpler to do while I show you on video.
Its important for you to see the entire history of the property you
are thinking about buying. To do this, go back in and open up the
property appraiser site. A lot of people own several properties,
but were only concerned with the subject property.
2. If your looking to bid on a bank foreclosure then you want to
make sure its a first mortgage that is being foreclosed. This is easy
to find online.
3. View the Sales History. Its always good to know what the sales
history is on the property your looking to bid on. It helps you
establish the market trends going back many many years.
4. Reviewing the Deed. One of the great things about online public records is that you can not only view the deed online but you
are also able to view any back taxes as well as actually pulling
the original mortgage on the property. Some counties have really
161

good public records online and some do it the old fashioned way
and store them at the county recorders office.
5. Viewing the Images. Whats so great about these public records
is you can click on the deed to see it. In fact, you can view the
image of anything that is a public record. For example, if I click
View Image on the deed, I can see the scanned copy of the actual deed that was filed. In many of the counties you can actually
see pictures of the property your looking to bid on.
6. Mortgages. Its always important to see that when your bidding on bank foreclosure properties that you are bidding on the
1st mortgage. This is the senior bank lien and you just want to be
sure that what your bidding on is not a second mortgage.
7. Understanding the Judgment Amount. What the judgement
amount is is the debt on the property that is being foreclosed. If
you were to take out a mortgage on a property for $300,000 and
didnt pay that amount then the bank would foreclose. The bank
would be awarded interest and fees and the total amount of the
judgement would include the amount you owe on that $300,000
mortgage and any additional interest or fees you owe. Dont confuse the judgement amount with the value of the property.
boosting your own knowledge of the process. Every time
you run through these steps, even if its a property you dont win,
just doing the research is going to enhance your knowledge that
much more.
Understanding First and Second Mortgages

The first mortgage supersedes the second mortgage.
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If the first mortgage is the one whos foreclosing on you, any
subsequent mortgages are automatically wiped out because the
first mortgage is the first mortgage. Just think of that logic. When
Bank #1 made the decision to lend money on the property, they
were making that decision based on the fact that theyre in the first
lien position, and in theory no one else has a claim to the property. A
first mortgage is more protected because if you do not pay your first
mortgage they can foreclose on you and recover the most amount of
money they can without having to worry about paying the second
mortgage.
What if the property being foreclosed also got a second mortgage five years later from bank #2, but after time neither Bank
#1 or Bank #2 was being paid. How is bank number 2 going to
supercede the lien that is already in place by bank number 1. The
second mortgage knew the first mortgage was in place at the time
they decided to allow the second mortgage and made a calculated
decision that they were going to lend, even though they knew
there was already a first mortgage in place.
How could it be fair if you didnt pay bank #2, and they could
wipe out bank #1? How could it be fair to bank #1 who didnt
make the decision to allow more money to be lent on the property? They lent it based on the merits at the time of the initial
purchase.
Its common sense. The second mortgage from bank #2 knew
the first mortgage from bank #1 was there when they made the
decision, but the first mortgage from bank #1 doesnt know that
theres going to be a second mortgage from bank #2 down the
road.
163
Understanding Foreclosure
Now its up to the bank to recoup whatever they can, so its going to auction where theyre going to get as close to that judgment
as they can. Its up to the bank to determine what they want to
sell it for.
Some people might say, Well, its a really nice house. It must be
a really high price, or Its a bad house. It must be a low price.
None of that really matters, because we dont know how much
money any bank would be willing to lose on any given property.
If the History on any Property Doesnt Make

Sense to You: Simply DONT BUY IT
If this information isnt perfectly clear to you, then dont buy
that particular property. Be sure to read this study guide over and
over, and apply these steps. Its a process you need to know and
understand. I didnt just guess at this.
In our Lee County example, if you want to research property
liens on an auction property through the auction, they actually
give you the link. You click that link, and go to the public search.
You do the exact steps each time.
If you bid on a property through the tax deed, thats another
story. Were talking about bank foreclosures. You want to make
sure its a first mortgage. This way you can make sure that if there
is a second mortgage that it will be wiped out when the first mortgages auctions the property.
164
Where Do These Auction Properties Come From?

Many people want to know when the county has an auction
and they have all these properties theyre selling who were the
original owners of those properties?
Ill give you a real life example. This is how Ive been successful
so many times. There was an auction in upstate New York just a
couple of months ago that I attended. There were 3,000 properties
being auctioned by the city.
There could be an auction for people who didnt pay their bank
mortgage. There could be an auction where people didnt pay their
taxes. There are different ways you get foreclosed on. There could
be an auction because you didnt pay your Homeowners Association dues on your condo. There are different ways properties end
up being auctioned.
Those 3,000 properties were people that didnt pay their property taxes. There might have been 1,000 people in the room. Do
the math.
What kind of competition do you have? Imagine 1,000 people
looking at 3,000 properties? Many of them dont even sell, which
means nobody bids. Thats how small the competition is. When
you buy at auction, youre taking that one property and youre
advertising it to thousands of people. Its still the basic principle
of supply and demand.
The county wants to be made whole on the back taxes due. The
new property owner pays the back taxes thru their bid amount
and now the county likely has a new owner that will continue to
pay when the property taxes become due for the next year.
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Now that its back on the tax rolls, the chance of the new owner
defaulting on the taxes is very slim, because they just paid cash to
cover all the back taxes.
Its a great revenue source for local government, because now
theyre getting all their taxes paid. Plus theyve got a property
owner that is going to pay in the future.
Thats a win-win. Everybody wins, except the person who didnt
pay their taxes.
In many cases, you end up renting to the previous owners. Some
people cant budget a couple of thousand dollars a year to go
towards a property tax. Some people just cant save their money.
They just cant pay a yearly tax bill.
Its just a different mentality. Some people can pay that $500,
$600, or $700 a month in rent because thats their housing expense. They can take their pay check, pay their rent with it, and
live off the rest of the money. We call it paycheck-to-paycheck.
People that live paycheck-to-paycheck usually have a very difficult
time paying property taxes because there might be three workweeks worth of pay to cover their property taxes and they just say,
We dont have it.
To you and me, and to a lot of people reading this, that might seem
ludicrous. Youve got to know theres a whole wide array of people
on this planet. Some are very responsible. Some are completely irresponsible. Some can save money. Some cannot save money.
People that cant save money, even if theyve owned homes,
ultimately end up being renters because they can handle paycheck-to-paycheck, and they have no other choice. If they get
166

paid once a week a lot of people get paid every Friday by
Wednesday, theyre broke. The last two days before they get their
paycheck, theyre struggling to eat lunch. I see that all the time.
I see people that have a nest egg. They have a 401k. They seem
to save. Others making the exact same money are broke the day
before they get paid again. They have zero savings, zero net worth,
but they make the same money as the next guy who is a good saver
and is frugal with his money.
There are all different kinds of people. If that wasnt the case,
real estate investors would not be successful. If every single person paid their bills, if every single person owned a home, it would
be very difficult to be a successful real estate investor.
CHAPTER 14 Summary:
Do your research. All the information is public record
and easily accessible. Go down the chronological list and
make sure everything matches up and makes sense.
If anything doesnt make perfect sense to you, and
you dont feel confident about the deal, or you dont
understand the history, DO NOT BUY. It takes a
couple of times to get proficient at this type of research.
As you go through the process, youll become more
knowledgeable.
Understand the difference between transferring a
mortgage where one bank simply transfers the
mortgage to another bank and having a first and
second mortgage. Go back and read this section again if
its still not clear.
167
STUDENT TESTIMONIAL
Mike Holds You by the Hand and
Shows You Everything!
As a young doctor, Ive been looking for ways to

invest starting with very little money. In this course, Mike
actually holds you by the hand and shows you how to do
everything from A to Z without any guesswork.
My first home that I bought was built in 2003, and my
second purchase was a home built in 2006.
After training with Mike, I was able to get 2 great
properties for a fraction of their previous value. When I sell
them, I expect to get a minimum of $25,000 to $30,000
per property in profit because these are practically new
homes.
If you are on the fence about doing this, just do it. Its a
lot of fun, and you get to see exactly how Mike does it and
how you can do it too. Ive always wanted to invest in real
estate but didnt think I had enough money. Mike gave me
the strategy I needed and showed me how to do it with
hardly any money.
Dr. Karl, One of Mikes Real Estate Investing Students
168
CHAPTER 15
Back Taxes
How do you know when you buy a property that there are no
back taxes? Im going to show you right now. Its important to
realize when you buy a property through a foreclosure:
If its a bank foreclosure, you will still have to pay the back
taxes.
If its a tax foreclosure, the taxes are paid through the
foreclosure.
No matter what, the government is going to get paid. For people who own property that do not pay their taxes, the government
will place a lien on the property and sell it at a tax auction for the
amount of the taxes owed. Thats why:
You Need to Know if a Property Has Back Taxes

Im not saying you dont want to buy the property because it
has back taxes. You just want to understand how much those back
taxes are so you can bid accordingly. The worst thing that could
happen is that you use all your funds by bidding your absolute
maximum bid, and then you find out theres a couple of thousand
dollars due in back taxes. It doesnt mean thats a deal breaker,
just know the tax situation before bidding.
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People say, Oh. Its just a couple of thousand dollars. If you
know what you are doing, its not necessary for you to lose that
money. In some cases, a few thousand dollars could be the difference between buying a property or not.
We determine what we want to bid based on how much money
we want to make. If you say, I dont mind tying up X amount
of dollars to make $10,000, and you find out after the fact there
are $3,500 in back taxes, it means that youre only making $6,500.
Thats 35% less than your initial calculation. Its important to
know how much is owed on the property.
Theres Always Something You Didnt

Think about or Know about
Maybe you didnt think you had to paint the inside, and you
find out it needs painting. You always want to have a little cushion
built in. If youre saying, Ive got to make $10,000 on this deal,
make sure you factor in a couple extra thousand dollars. Dont
kid yourself and say, Everything is going to go perfectly.
Checking Back Taxes

Every county in the entire country will have its own way for you
to determine the back taxes. Its very simple to determine the back
taxes on an auction property. Its simple if you let it be simple.
Lets Stay Consistent and USE Lee County Florida as Our

Example For Finding Back Taxes on an Auction Property.
1. Go to the Auction Calendar Page.
2. Click on the date you wish to search for foreclosures.
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Back Taxes
3. Click to choose a property. (Any property.)
4. Click the property appraiser link. The property appraiser site tells you the bedrooms, the bathrooms, the square
footage, and what it sold for. By the time were done, were
going to know as much about the property as possible. Its
important to learn this so you can take these tools and
investigate any property.
5. It will display a picture as well as the basic property
information
6. Click the tax bills tab. Perhaps it says all the taxes show as
paid. You want to see the details. How much are the taxes?
You want to know everything about the property.
7. Go to the most current year. If the owner didnt pay this
year, look at the last year. He couldnt have paid this year
without paying the prior years. As long as the most current year is paid, there are no back taxes. Lets say that
it says, Outstanding balance $2,134. You need to know
that to bid properly. Look at all the details. Know what the
taxes are. If you are going to buy the property, those taxes
are going to be your taxes year-to-year. This helps you determine your expenses and overhead on the property.
8. Scroll down to see the exact tax based on the assessment. If
you had a homeowners exemption in Florida, they would
take that off the assessment, and your assessment would
be that much lower.
Most people pay too much for their investment properties because
they dont have the tools.
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As you can see, this part of the site breaks things down in specific terms. Everything is there, including the sewer, trash bills, etc.
In some areas, youll pay a separate sewer bill and a separate water
bill. This is great information, because a house that sold for over
$250,000 and is still kind of new, has a total tax rate with sewer
and trash much lower than many parts of the country when you
deal with Florida.
Florida Discount
One way to decrease your tax bill in Lee County is to pay your
property taxes early. The taxes are due in March but you get a
1% discount for each month you pay early ( up to 4 months max)
meaning you can save up to 4% per year on your property taxes.
Not many areas in the country are this tax friendly. Florida is a
great place to invest because they are so tax friendly.
Every state has different criteria. If youre in a state with insane
property tax levels, investing there is obviously going to be less
friendly than investing in an area that has much lower property
taxes.
Some people love doing research, including me. When Im
learning a new process, I love doing research. You can do as much
or as little research as you want. The key is to get enough information so you can make profitable buying decisions.
For taxes, I only need to know what the taxes are and if theyve
been paid. Its not really that important to know what the taxes
were in 07, 06, or 05, but it gives me a feel for what I can expect to pay in the future. Dont go overboard. Ive met people
that spent 10 hours on a single deal researching, and then they
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Back Taxes
got information overload and ended up not being able to make a
decision.
Staying in the positive

The best advice I can give you is to look for ways to do a deal,
rather than not to do a deal.
Every single deal Ive done, I could

have found a reason not to buy.
Oh. It has ugly paint. The landscape is ugly.
Oh gosh, I dont like the house next door.
In the end, if I were to fast forward and show you my profits, it
would eliminate every single one of your objections.
Find Ways to Do Something, Rather

Than Ways to Do Nothing
Open your eyes to the possibilities. Learn techniques from
somebody whos actually had success with what theyre teaching
you. No theories. No guess work. These are things I actually do.
I do it all the time, hundreds of times, to the tune of millions of
dollars.
CHAPTER 15 Summary:
Make sure you know if a property has back taxes, so you
can bid accordingly.
Every state and county is different, and Florida is a great
173

place to invest, because they are very tax friendly.
Do as much or as little research as you want, but be
careful not to spend too much time and research your
way out of a deal that might have been good for you.
If you stay positive, you can always find a way to find a
good deal, and make it work to your benefit.
174
718 Roma: Bought for $29,000
Sold 7 weeks later for $80,000.
This is a single-family basic stucco Florida home, with 3

bedrooms and 2 full baths built in 2005. I purchased this as a
foreclosure for just $29,000, and it was in really good shape.
The technique I used to get this property so cheap was that I
put out a bunch of low-ball offers, and this was the one that
was accepted.
This property is a great example of what you can get by
submitting multiple low-ball offers. Several of the realtors I
submitted my offers through laughed, because they were so
low. But this one did not laugh. Instead, my offer was accepted,
and I became the owner of this highly profitable property.
Just 7 weeks later it sold for $80,000, and I made a quick
$51,000 profit!
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CHAPTER 16
Mapping Your Route

If youre looking to buy land, it doesnt really matter what it
looks like. Youll see some amazing deals, and youll see deals that
are not so amazing. With the power of the internet you can learn
just about everything you need to know when determining if a
particular piece of vacant land will work for you; do your best
and make a way below market value bid. Youll be pleasantly surprised when you win a nice piece of land for an unbelievably low
price.
When youre bidding on houses, its a much different story. Before you buy a house at auction (live or online), you might want
to physically visit the area and check out the information online
to help you in your decision making. If its not possible for you to
travel to an area, the good news is you can have other help you like
I have shown you throughout this book. Youve got to feel good
about what youre doing.
You can have others do the inspection for you, but if
You have the ability, are interested in finding a new area, and realize you would love to take these tools and do this in another area
youre going to want to be able to go there and do the inspections
yourself.
177

A lot of people say:
Mike, how are you able to look at 20 properties in a given
day?
How exactly do you determine what route to take to see so
many properties?
How are you maximizing the best use of your time?
As you know, for me, time is money, and if youre going to inspect the properties yourself, you should know how to map out
the most beneficial route so you can look at the maximum amount
of properties in any given day.
To Map Out a Great Route, Go through

the Auction Listings First
In order to have all my options available, I want to know precisely whats going to be auctioned over the next three weeks.
Then I can fly in, look at the next three weeks worth of properties, shoot video of them, and go back to the comfort of my own
home and bid online.
To map your route:

Copy the address of your first property
Go to Yahoo Maps. (I love Yahoo Maps. They get my
endorsement because theyre awesome.)
Click Directions in the upper left corner of the map
Paste in the property address
Copy and paste the address of your next property
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Mapping Your Route

Click Add Location
Copy and paste the address of your next property
Keep adding locations
You could do this with 40 properties, or even 50 or 60. Put in
as many as possible, because you dont need to do them all in one
day. Section it off, and think about visiting about 20 properties in
one area on one day and another 20 properties in another area the
next day. You want to take your time with this to make the best
informed decision.
Example: If youre starting from Fort Myers, and you also have
properties to see in Cape Coral, what would make the most sense?
Looking at the map youve created, it will be pretty obvious.
What you dont want to do is to just take one auction day and say
to yourself: Im going to look at everything for that auction day.
Thats because youll be jumping around all over the place. Instead, take 10 auction days. Separate them out, and note what day
is for what property. This way youll be able to look at the most
number of properties. Instead of driving all over the town to 10
different auction days properties, youre able to do 10 days in two
days because of the way youve mapped out your route.
Now, you might be thinking: Thats very simple.
I Just Saved You Several Hours of Legwork!

You might have used a Thomas Guide or something like that before, trying to figure out where a property is. Or youd think: Oh,
Ive got a navigation system. Let me just start plugging in addresses.
179

You could end up driving 45 minutes between two properties.
The idea is to make your route so tight that you drive two to three
minutes between properties. Youre in the car, out of the car, in the
car, out of the car, making your notes and videoing the properties.
Remember, I show you how to do this remotely too, but you
may want to do this in your backyard. You might want to try this
technique where you live. You might want to explore a different
area. You might want to have somebody else doing the inspections
for you. Its all about planning your route.
CHAPTER 16 Summary:
If bidding on houses, whenever possible, go check out the
area and properties yourself.
Use Yahoo Maps to map-out your route. Map-out your
route ahead of time.
When possible, make your route so tight that you drive
two to three minutes between properties.
180
STUDENT TESTIMONIAL
Husband and Wife Team Start Small
and now have bought 18 properties since
training with Mike!
In real life, we are plumbers. We work hard for our

money, and Mikes system has shown us how to have our
money work hard for us. Now we make a lot more money
and work a lot less at being plumbers!
We bought our first house in Florida purchased it
from a computer in my office in Los Angeles, California.
I got up in the morning. I looked at all the properties that
were available. I put in my bid, and I won it. I funded the
bid. They sent me the deed, and I started rehabbing the
house right away.
We bought it for $33,000, and I sold it for $83,000. We
made $50,000 gross profit more than we usually make in
a year on just one We also bought 2 lots right next door
to each other for $500 each. We sold them together for
$5,000. Mikes system is amazing and it truly does work.
My wife has always been skeptical about this. Now,
after receiving that huge $50,000 profit on our first deal,
I cant stop her. She wants to go look at properties. She
wants to fix the properties up and sell them, and I do too!
Johnny & Denise, Two of Mikes Real Estate Investing
Students
181
CHAPTER 17
Exterior Property Inspections

EXTERIOR
In this section on exterior property inspections, I will use an
example of a property I purchased using one of my auction techniques. This property was purchased for $37,000 and it is less than
10 years old.
On each auction day youre going to have different properties
and different prices. The idea is to do this systematically. Do your
research because you will not get these kinds of deals if youre not
knowledgeable about the details.
Im not saying these deals come up every single day, but I would
never have got this deal had I not been bidding at the auction.
Lets talk about exterior property inspections. Ill share precisely what I look for when Im inspecting exteriors.
In this example, the exterior of the property is all stucco and
concrete block construction. Its got really nice trim around the
outside and has great curb appeal. Its got great details; nice trim
around the pillars, nice gutters, and an architectural shingled roof.
The roof looks kind of 3-D. It has great shingles that are much
better shingles than the usual basic 20-year-old singles that just
lay flat. The older, flat shingles wear out much faster.
183

To review, you notice the architectural shingles, the perfect gutters, the trim around the garage, the windows, and the concrete
block construction. But thats all curb appeal. Lets get into some
of the meat and potatoes.
Check out the AC and the water equipment looks good.
If youre going to invest in Florida, the AC unit can make or
break a deal. Look to see if its a newer machine. In this example they have a Goodman air conditioning unit. You can tell its a
newer looking machine. Its not a top of the line air conditioner,
but Goodmans are durable and last a long time. Its a good sign.
Looking around, you notice that the exterior is in good condition, but when the sprinklers hit the side of the house, it leaves
a little mildew. Thats okay, because this is concrete block construction. You look around the neighborhood and you notice on
almost every single house, the water hits at the same level. Its not
permeating the block, so its not a big deal. Maybe every couple
of years you put a coat of paint on it.
Next, check the pressure tank. Pressure tanks are unique to
Florida. What happens is the water comes from a well that comes
out of the ground and into the pressure tank. Theres a well pump
that actually pumps the water up through a pipe and brings it into
a machine that removes the sulfur. In the pressure tank, there is
a place for salt. This unit is actually a water softener. This system
takes the well water and cleans it, so there are no water bills. Some
people say, I dont want to mess with well equipment. But remember, this well equipment means you dont have to worry about
paying a water bill each month. You can water the grass as much
as you like and not worry about getting an outrageous water bill.
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Exterior Property Inspections

By the way, economists predict that water is going to become
increasingly more expensive. That means free well water will be a
great asset for your property and the water is so abundant in Florida that I have never worried about a shortage of water because it
all comes from the same water table underground.
If Water Is Free, Why Not Have the Greenest Grass?

As we continue around the house, we notice that theres an automatic sprinkler box which is unplugged right now, because this
is the rainy season so we have all the green grass we need. When
it gets dryer and the sprinklers start spraying against the house,
thats where youll see more mildew. Its not a big deal. It could
easily be repainted. One thing youll notice about Florida properties are the screened-in patios. These are nice because the patios
end up being in really good shape instead of weather worn.
In this example, I paid just $37,000 for this property. There were
great details on the exterior, and everything worked. The backyard backed right into open space, with no houses behind for at
least 5,600 feet. This is the type of house youre looking for.
In conclusion, when Im inspecting the exterior of a property, I
want to walk around and know what Im getting into. How does it
look? Is it concrete block? Hows the AC? Hows that water equipment? Whats the curb appeal because curb appeal sells.
In general, my experience is that the newer builds need the least
amount of work. Thats why I prefer to buy newer homes. If the
roof and windows look good, and there is no concrete damage,
its a good sign that this property is not only good on the outside,
185

but chances are high that it is probably pretty nice on the inside
too.
CHAPTER 17 Summary:
You can tell a lot about the value and interior of a home
by the exterior.
Look at the architectural shingles, the gutters, the trim
around the garage, the windows, and the concrete block
construction.
Check the windows. Do they need to be replaced? If so,
get a couple of estimates so you know how much youll
have to spend to prepare it for sale or rental.
Check out the AC and make sure it works and that the
unit is in good shape.
Walk around the house, and look at everything. Do the
best you can at inspecting the exterior, and know what
youre getting into before you leap in.
186
3221 Willin Street: Bought for $24,800 Sold 9 months
later for $55,000.
This is an interesting story. Its a 3-bedroom, 2-full baths,

approximately 1,115 square feet, single-family home built in
2004.
After buying this home through a foreclosure auction, I went
to the property and knocked on the door. The previous owner
was still living in the home, and I asked her if she wanted to
stay. She said yes and signed a one year lease, agreeing to a
monthly rent of $700.
Since she was still living there, I didnt have to do any repairs
or remodeling. Thats why I sold it so cheaply and still more
than doubled my money. Plus, I collected rent for 9 months
before the sale.
187
CHAPTER 18
Interior Property Inspections

INTERIOR
This chapter is about inspecting the interior of auction homes.
Some homes will be a little nicer; some will be in a little bit
worse condition. Typically, youre going to want to paint the inside of the house. Youll find that most of the time there will be
a few holes that will have to be patched here and there. I would
certainly count on painting all the walls inside.
Lets say that your kitchen is very basic, and it has no appliances. Its up to you. You can either buy brand new appliances, or
you can get used appliances.
If Im quickly flipping the home, I might not worry about the
appliances and let the new buyer take care of installing them. If
the property is in pretty good shape, and I still want to quickly
flip, I may get used appliances to make it look like less work for
the new buyer.
On the other hand, if I am planning on holding onto the property and carrying it as a rental for the monthly income, I will probably spring for new commercial grade appliances. The reason I say
commercial grade is that if the property is one I want to keep and
rent out for several years, I want good, dependable appliances that
189

can easily handle constant daily use. I also want new appliances
that come with warranties to protect me against having to fork
out more money for any necessary repairs.
Something you always want to look for is to make sure there is
always an AC unit and a heater. Is the heating coil there, or is it
missing? A lot of people might inspect a property and not even
notice that the coil is gone. They would say, Oh look, the heater
is there. Youve got to open it up and make sure all the parts are
there. If it has electricity, turn them on to make sure they work.
Pay attention to the details.
When youre buying a property, check everything out:
Is the hot water tank good?
Are the walls good?
Is the heating unit good? A heating unit that someone has taken
the coil out could cost you up to $1,000 to repair.
Is the flooring good? When you see tile floors, you know its just
a matter of cleaning up the tile. When you see this, be happy, because the flooring alone is going to save you a fortune.
Although the repairs may not cost you a lot, you need to know
what youre getting into, because you dont want to just buy properties blind and then suddenly have to fork out thousands of dollars to get the property in good enough shape to rent or in good
enough shape to flip, and make the profit you want. It is certainly
good to buy fixer uppers as well because the percent of profit you
make is usually higher. You just want to know what repairs will
be required so you can bid that much lower on the property factoring in your time and money.
190

Sometimes youll buy properties, and theyll still have trash
and furniture rubble from the previous residents in them. When
you come in and see lots of junk still inside, you know this is a
CLEAN-UP. You also know that you are going to need to paint
every room and every wall most likely, because people that leave
junk in their homes typically have dirt on their walls as well.
If you look at the details of the house, and determine it was
built in the last decade. You will likely know your windows and
roof are going to be good. The basics of the house are going
to be good. When youre talking about a newer home, youre
talking about cosmetic repairs that are not very expensive: paint,
carpet, sometimes kitchen flooring.
When youre bidding on a property, its important to understand that its easy to get people online who will go out to the
property and do a quick inspection for you. Ask them to take
pictures and/or video and e-mail them to you. Theyll even give
you the quotes on how much and how long it will take to do the
needed repairs. Youll find out exactly what a property needs,
and it saves you a trip to the house.
Lets say the house youre looking at has bathrooms that are
standard cookie-cutter bathrooms. You notice they have basic
vanities, basic sinks, and basic toilets. In an investment property your only concern is not how nice the stuff is, just that its
there and in good working condition. If your goal is a rental
property, even though this might not be the cabinet base you
would put in your own house, the question is if its a good
cabinet base. If this is going to be a rental property, youre not
trying to make this place the Taj Mahal. Youre trying to make
191

it so you can get a good tenant. This is the single best rule when
remodeling rental property:
Remodel to the Level That Will

Get You a Good Tenant
Your goal is to make this place as nice and reasonable for the
tenants as possible. You look at the bathroom; its just very basic.
It has a toilet, a sink, and a shower thats got very basic tile. Sometimes just the small details will convince good tenants to rent your
property.
Thats it. As long as the components are there, thats the key. If
theyre not there, this means you have to factor in replacing them.
Check each room, because you never know what youre going to
find.
If you have to spend a little money on dressing the other things
up, you just back-out all of those costs from what you would bid
on the property. When you bid on the property, be sure to factor
in the money you would be putting into the property. If youre unable to do inspections live, send somebody else out there and have
them report back to you with pictures if possible.
Use the tools that Im teaching you to send people out for free.
You can get contractors and different tradesmen to go out to your
properties and tell you what they need. If you find one of your
properties needs fixing, hire them to fix it. Thats the trade off,
and how you educate yourself is by professionals telling you what
a particular property needs.
192

When I started in this business, I had zero construction experience. I had never done any sort of construction. But nowadays,
Im able to look at a property and analyze it based on what Ive
learned from professionals that have told me what they would
charge to paint the inside and/or outside, to put in new flooring, a
new heating coil, and what I can expect to pay for new appliances.
Its not costing you anything to send professionals out, because
you have to remodel the property anyway. Why not get multiple
quotes? Why not send multiple people out there for you? Thats
the best way for you to learn this business.
CHAPTER 18 Summary
When buying a property, check out everything and make
sure it works. Not discovering something as simple as
a missing heating system coil could cost you $1,000 to
repair.
When youre bidding on a property, its important to
understand that there are people who will go out and
inspect the property for you.
In this volume 1 of Real Estate Investing That Works,
I walk you through the strategies and techniques that
have been successful for me. I spent the last 12 years and
hundreds of successful real estate transactions to compile
the information in this book. I care about my students
success and look forward to hearing about your success.
The next volume will have even more information to
bring you my vast amount of real estate knowledge. My
193

passion is real estate and I hope you feel inspired to
take action. Always remember that taking action and
knowing your WHY will help you to be successful.
194
STUDENT TESTIMONIAL
Got My 1st Property for under $25,000!
I acquired my first home here in the United States, free

and clear, for under $25,000. Thats amazing and unheard
of where I come from in Egypt.
From Mikes system, I can look at a house in 23 minutes;
I can assess its value or potential problems and the positive
and negative aspects of the property. I can analyze it quickly
in my head and know if its a good deal or not.
The other thing I like about Mike is his ability to teach.
You have two types of teachers; those who know how
to teach, but have never done what theyre teaching and
those who are not good teachers, but personally know
how to do what theyre trying to teach.
Mike is the best of both worlds. Mike has done what
hes teaching, and he knows how to teach so you clearly
understand and can do what hes taught you. He can talk
the talk, and he can walk the walk.
Amir, One of Mikes Real Estate Investing Students
195
CHAPTER 19 Continued In
Real Estate
Investing
That Works
A Proven System
Volume 2
by Mike Gazzola
197

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