One of the most important steps in creating wealth from real estate is to put together your real estate power team (T.E.A.M – Together Everyone Accomplishes More) in place. Most people are so excited to start investing and create cash flow, they go buy a property and then it comes…the freak out phase! The freak out phase that comes when you do the process backwards.
No do not laugh, more people do the process backwards than actually do it correct the first time. Sadly, many of these people now have a bad taste towards real estate investing and got out of the investing game all together. (Isn’t that interesting)? Now that we are in the best time of our entire lifetime to be investing in real estate, many real estate investors have jumped ship.
Do not fall prey to having bad experiences in real estate investing. There are so many things you can do to prevent challenges and the proverbial Freak Out Phases so please read all 7 of the Getting Started In Real Estate Investing posts and do what you can to position yourself for success.
Of course there should never be a freak out phase, (hence your desire for a powerful power team) and if you are purposeful, there will not be one. I know people who purchased before creating an entity such as an LLC (this one is common), some do not even have a checking account where their rents can get deposited into and after three months of collecting cash flow, the property management company has no place to forward their funds to. (OK, do not laugh here, these oversights happen every day).
When you are purposeful with a power team in place, you will have positioned yourself for maximum success. Your Realtor, Lender or Private Money sources, your Accountants, your Attorneys, your Handyman, your Property Managers, your Self-Directed IRA Consultants, etc. should all be identified before or simultaneously with the property purchase.
If your best investments are in the best locations, you will want to make sure you have a team of the best real estate investment minded people in the location where you do your investment. Hint – the number 1 question to ask any of these people is, “do they indeed themselves invest in real estate?” You always want to work with likeminded people who know exactly what your basic concerns are.
Did you know that 97 percent of realtors in the U.S. do not even invest in real estate? This means that only 3 percent of the realtors actually understand the benefits of real estate investing and you definitely want the person who is helping you to think like you do and understand what you want.
Here is a great nugget of information many do not know. When you find great real estate professionals, great locations and truly great properties, these professional providers often are affiliated with a full team of professionals (power teams) like we discussed above. This group of professionals can serve as a great fast forward to getting you underway with purposeful real estate investing.
Either way, there are a few things you will want to secure during or in advance of your purchase:
- Do you have an entity structure set up for asset and liability protection?
- Do you have a checking account established to run your income and expenses through?
- Do you have a GREAT property manager lined up to manage the property? I have compiled a list of helpful questions to assist with this – check out our Due Diligence Property Management Questionnaire.
For Our Foreign real estate investors, you will also want to consider:
- Do you have an understanding on how you are to bring money back to your home country?
- Do you have a currency exchange facilitator lined up to maximize your currency conversion (contact me if you do not know what this is about, it is a wealth of knowledge)
I trust you can see how being purposeful and establishing or working with a Professional Power team will set you up for success and eliminate the Freak Out Phase.
Next we will be covering the due diligence process. You will NOT want to miss this.