http://www.claudediamond.com
CC&R PROPERTY INVESTMENTS, INC.
P. O. Box 960
Winter Park, Colorado 80482-0960
All rights reserved.
No part of this book may be reproduced without prior written permission from C C & R Publications
P O Box 960
Winter Park, Colorado 80482-0960
PREFACE
I wrote this book to show you how easy it is to achieve success in real estate with Lease Purchasing and the right philosophy or what I commonly refer to as ‘attitude’. The concepts necessary to achieve this success can be accomplished by anyone with specialized knowledge and dedication, but sometimes it takes just a little bit more. The guiding hand of an experienced and successful mentor can really make the difference between just making it and financial freedom.
I count myself among the fortunate in that I had just such a person whose guidance, consultations and hands on training put me on the fast-track to financial success. Years later I realized that many individuals were spending a great deal of time, money and energy only to have prosperity elude them time after time. People were looking for ways to make a positive change in their lives as I had, but how many people are truly fortunate enough to have their own Millionaire Consultant or Mentor? Such a program was just not available in the marketplace, until now.
I have put together this Mentor program of Specialized One-on-One Training so that anyone can now achieve the same success I have experienced. Now you must be honest with yourself, do you really want success bad enough; with our program there are no more excuses. The Nike™ ad says it best “Just Do It”!
Mediocrity should not be a way of life
“Claude”
INTRODUCTION
Lease Purchasing is the most innovative and creative method of real estate financing ever developed. We have taken this rarely discussed, under used and misunderstood means of controlling real estate and have created a program so easy that any renter can become a homeowner and any potential investor can become an entrepreneur. With this new and unique program we provide you with all of the materials, research, forms, contracts and assistance necessary to make you a Lease Purchase expert. You will work directly with an experienced investor who is available to answer your questions, make recommendations and see that home ownership or profitable investing is a reality for you as soon as possible.
For too long, the rules of real estate and finance dictated the only ways to control properties were to have large down payments, excellent credit and then maybe the bank would consider your application. Today, thanks to our unique Lease Purchase Program
anyone who has ever rented and is willing to learn our methods, can turn the tables and control properties profitably and quickly.
Imagine that the $800.00 per month rent payments you are currently making (for your landlord’s Mercedes) is instead going to the principle or deposit on the same home you are now living in. Hypothesize that you were credited 100% of your rent, (based on the above $800.00 per month), in one year you would have $9600.00 to use as a down payment.
Becoming involved in the acquisition of your own home or investment properties through Lease Purchasing will be the best financial and entrepreneurial move you have ever made.
You have made a great start with a great company to begin to insure your family’s financial security and prosperity. Diamond Consulting Group is about people such as yourself who have learned that getting into real estate is possible if you have the right teacher.
The American Dream of success can be obtained if you are willing to learn the specialized methods of Lease Purchasing with an experienced mentor. Pat yourself on the back, you have made a positive decision that can change your life. It’s time to get excited, have some fun and get involved in Lease Purchasing.
My organization, associates and I are here to help you succeed with our Lease Purchase Program. We are ready to help you accomplish your goals in today’s real estate market.
PERSONAL NOTE
A long time ago I decided that I had to have the financial independence that could only be achieved by having my own business.
I wrote a list of just how I felt that business should work. I still feel the same way now as I did then and my list, (which follows) is very likely to apply to you!
1. Find a vehicle of success that wouldn’t cost a great deal of money to start up. (I didn’t have much money at the time anyway).
2. It would have to create an immediate cash flow. (So I could pay my rent).
3. It would have to create long term capital wealth. (Always think of the future).
4. I could operate this enterprise from my home, anywhere in the U.S.
(I hate to commute).
5. It had to be honest and simple with low operating expenses. (Good idea).
6. It had to be of a benefit to others. (Why not ?)
7. It must allow me the luxury of time and wealth so that I may pursue other areas of personal growth (skiing).
8. Find someone with a wealth of knowledge who could show me all of the above. A true Mentor !
What you are about to read is the most misunderstood and yet powerful means of controlling real estate ever conceived. It is not a secret, but very few people have taken the time or trouble to truly learn the principles of the Lease Purchase. If you understand what the art of leverage is all about (controlling a lot with a little), then you know that there is no other alternative than the method of Lease Purchasing. This means of finance is revolutionary and can be your means of creating wealth with Lease Purchasing
CONVERSATIONS WITH A Lease Purchase Mentor
Over the years I have had the pleasure of Mentoring select individuals from all over the world. They wanted to have the same success that I found with this wonderful (but seldom used) technique called Lease Purchasing. What you are about to read is an actual Mentoring session that I conducted. I believe that this is an extremely valuable section of my book. It contains so much hard information and includes so many excellent questions in a readable and hopefully entertaining and motivating format.
Claude: Good Morning! Let’s get started learning about The Best Concept in real estate, Lease Purchasing. First a little background. When I got started in real estate many things that were true then are still true today. There is still a plethora of Guru’s selling books, CD’s, DVD’s and seminars. They all seem to sing the same song “get rich quick purchasing foreclosures, fixers, putting nothing down, using sweat equity and so on. I followed all this wonderful advise and for the most part had nothing to show, but thousands of dollars in debt, liability, negative cash flow, overhead like taxes, insurance, repairs, legal fees, principle and interest payments. The management of the tenants was no picnic either. I had very little control of them. They paid either late or in some cases not at all. There were constant evictions, attorneys, repairs and malicious damage. I had to work a second part time job just to keep up with all the debt.
Client: Wow, I would have quit at that point.
Claude: I was almost ready to quit, but then I heard of a man who was a self made millionaire with an unusual technique. This concept would allow me to control good properties in good neighborhoods without the bank qualification, large down payments and would be profitable from the beginning right to the end. He was my Mentor, Max. He taught me some of the basic principles which I am going to share with you today. Max used to say:
“Why own real estate when you can control it.”
I didn’t have a clue what he meant. He also used to say “just let everyone else buy it, fix it and then we will control it”. You see Max came to this country with nothing. No credit, no money just knowledge of the true principles of leverage and control which we are going to discuss today. The concept of Lease Purchasing !
Client: OK-OK !! Let’s get going here I’m biting at the bit.
Claude: All right. There are so many different kinds of lease purchases or option techniques so before we get into strategies let’s begin with a good foundation and start off this discussion with a good definition of a Lease Purchase.
A Lease Purchase is really two basic concepts in real estate; Leasing and Purchasing.
The first concept is the lease or as some would call it the rental. In a lease we obtain temporary possession of somebody else’s property. We do not own it and title has not changed, but yet we control it. We can rent anything in our society, cars, lawn mowers, motel rooms. We can rent any kind of real estate like mobile homes, condos, townhomes, single family residences, large estates, you name it.
If we can rent somebody’s property and obtain possession, we can have partial control of it just as any other tenant does.
The second part of the definition is the option to purchase. Option to purchase means you have the right not the obligation to purchase somebody else’s property for a pre-negotiated price and terms. So we can rent something, we can use it for our own needs and for others. We can pre-negotiate a possible purchase of this property for sometime in the future.
Now the one thing that is quite imperative in a lease purchase is getting the assignment clause negotiated into the contract if we want to personally control it. An assignment clause gives you the right to sublet, transfer and convey any rights which you have negotiated within the contract to a third or fourth party. If done correctly we can now control someone else’s home without the purchase, transfer of title or loan and our costs are fixed to just a simple monthly rent just like any tenant would pay.
The only thing you really have to understand about lease purchasing is that you can make more money by controlling other people’s real estate than you can by trying to go out and buy your own real estate all the time. For example, you go out and buy your own real estate, you have got to come up with a lot of down payment, 10 to 30%. You have got to qualify for a loan, you have to pay taxes, insurance, homeowners fees and all this stuff. You are responsible for the maintenance, if the roof leaks that’s your problem. I think we have all been basically brainwashed that the only way we can be involved in real estate is by buying it all the time and that is simply not true.
We can control property by negotiating long term leases with options or rights. A lease purchase from the investor’s view point is that we can control this property the same way a tenant can control it. We can put one or two months down for as long a lease as possible and then go just a bit further and negotiate all the terms of the purchase. We don’t have to pay the taxes, insurance and homeowners fees. We are not responsible for maintenance on the property if the heating system goes out or if the septic tank leaks.
We can have more control by optioning or leasing with optioning a property than you can by buying. This is what you must understand inorder to succeed with this specialized knowledge.
Now I am going to break down my strategies into four different parts. I call them
My Four C’s.
The First “C”
The First “C” stands for Control. I want to control other peoples’ properties. How do I get this control ? Normally this involves some kind of motivated seller. What does every guru at every seminar say ? They say find the motivated seller. Well I have some shocking news for you, not everybody is highly motivated. (I know you knew this already). The beauty of lease purchasing is that we have a technique that can work with the non-motivated person, too. This technique is really not well known because it is a niche and it is not utilized by many. If it is presented to people and we educate them on its benefits and advantages we can work with the non-motivated person, too. We are going to start, however, with the motivated seller for this portion of the First “C”.
Who is the motivated seller ? Did you ever get stuck with a property ? We have all been there. We all know what it’s like when we want to get out of the property, when we have the tenants from hell or when real estate is going down in value. This could be a seller who is being transferred, moving, experiencing a family change, one who has built another home, has a new job, has no job, for many reasons. We just don’t want to buy it, we want to control it.
The control strategy involves two distinct techniques; Sandwich Leasing and Assigning. Let’s begin with the sandwich lease. This is essentially a home where I can negotiate a long term contract with the right of assignment. I like sandwich leasing because there are a multitude of profit centers within it. You were looking for good properties, in good neighborhoods, no more war zones and no more major fixer uppers.
Client: What is the difference between sublet and sublease?
Claude: Basically they are the same thing. I use the word interchangeably to mean renting a home with the right to purchase from Owner “A” and then turn around and rent it with an option to Tenant “B”.
Client: Exactly what kind of homes do you mean ?
Claude: My favorite phrase is as follows:
“I like good properties in good neighborhoods.”
I don’t mind if they are blue collar neighborhoods, middle/upper class, etc. I just don’t want to go into the war zones or deal with major fixer upper properties. "Been there, done that!" My Don Quixote days are over, thank goodness.
I am not going to get the type of option money I am looking for by trying to sell something to people they don’t want. Further, I don’t want to make capital improvements on properties I am only renting. Finally I want this property to turnover within 30 days or less. All this is common sense, yet it goes against all the conventional thinking propagated by your well known gurus, writers and speakers. Gee I wonder why ?
Client: Do you have a dollar limit here? What kind of repairs are we talking about ?
Claude: I am talking about cosmetic repairs. I don’t mind if a property needs a little paint or carpet cleaning, new toilet seats or minor things, that’s fine, but I don’t want to do the major renovation stuff. It’s too time, money and energy consuming. There are plenty of good homes in good neighborhoods without the hassles. I don't want to do lease purchases on hard to move properties. Yes, I want it all and with Lease Purchasing I can have it.
People want to live in good areas with good schools and amenities. It doesn’t have to be the prettiest house in the neighborhood, but they want stable neighborhoods.
Client: How did you come to this philosophy ?
Claude: When I started in real estate I thought that I was smarter than the marketplace. I got some of the worst properties in neighborhoods and even with generous rent credits they were sometimes very difficult to move. The tenants were less than motivated and the upkeep was costly. I thought that I was getting a ‘steal of a deal’ but in reality all I was getting was an alligator property and a constant headache. The way creative real estate is taught today by many is just going to result in frustration and burnout with loser properties.
Client: Claude, I recently heard a speaker who was preaching about his wonderful technique of going to the ugly properties and war zones, etc. We should pay 20 to 30 on the dollar for these properties and then flip them with creative financing. From what you’re saying this is not a viable method, is it ?
Claude: Why would anyone want to own, much less control, homes in high crime areas or costly fixup properties when you can control much better homes with a Lease Purchase? It just doesn’t make sense. As I said my Don Quixote days are over. I am through fighting windmills or for that matter, hard to market properties. We don’t make any money when we are stuck with the monthly payments, high advertising costs and repairs. The bottom line is we lose money, don’t we ?
Client: If we can’t feel safe when working on a property then we don’t want the property under any condition, correct ?
Claude: Exactly, and you know what I have discovered there’s just as many properties in these good neighborhoods. It’s just a matter of where we focus ourselves and our efforts.
Client: Now what kind of properties are we talking about here?
Claude: Condos and townhouse are fine, I have done a lot of them. Single family homes are excellent. I love those especially, the bread and butter 3 bedrooms/2 baths. Client: What about the expensive homes, the high end stuff ?
Claude: If you want to get into the high end real estate you can do that too, but of course you are not going to commit substantial funds to those kinds of deals. The last thing you want to do is get stuck with payments on a home that’s running a couple of grand a month. There are some Lease Purchase techniques we can use in these types of properties, too which I will discuss later. (See Cooperative Assignments-the 2nd “C”).
On Oct-09-07 at 15:26:57 PDT, seller added the following information:See our new and Free Lease Purchase Video Library
http://www.youtube.com/user/cdmentor
Free Lease Purchase and G.U.T.S.™ Sales Training Method
http://www.ClaudeDownload.com
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