Ultimate Weekend Brilliant Workshop Ultimate Workshop 9-10 th April 2011

Ultimate Weekend Brilliant Workshop Creating Brilliant Deals With Little or NO Money Down Debbie Williams Principle : Savvy Property People

Ultimate Brilliant Workshop About Me Principal of Savvy Property People Real Estate Agency Winner Property Women of the Year –Development Diva Runner-up Property Manager of the Year, Reno Queen Renovator / Developer Boarding House Proprietor Director of Equity Finder Property Investing Coach Developed Own Reno System NLP Practitioner Wife, Mother, Grandmother

Ultimate Brilliant Workshop My Property Story Limited knowledge I bought 3 Semis buy and hold Then ran out of my massive $30k equity!! That’s it..no more deals..end of game.. What now ? Did a course..it was brilliant! Got a coach Decided on Reno as strategy Wanted QUICK Results (the Impatient Investor) Time Rich, Equity Poor - Do JVs?

Ultimate Brilliant Workshop Alternatives Joint Ventures Equity Partners Private Loans Banks Vendor Finance Creative Options Being Sustainable

Ultimate Brilliant Workshop Joint Ventures Evolved over time Initially gave lots away, now value what I have to offer much more Can be done many ways Structure is very important Finding the “right one” is important Deal needs a conclusion

Ultimate Brilliant Workshop JV Example 1 Buy in own name (or entity) Get bank loan usually 80% JV partner puts in 20% Other costs negotiable between partners – Stamp Duty, Loan costs etc Share 50:50 after costs Project relies on Value Add component

Ultimate Brilliant Workshop JV Example 2 Boarding house for sale! No Money!! Sell 4 shares $40K (mine free) 5 Year plan for exit Share the income and expenses I have bank loan & ownership, others secure with caveat

Ultimate Brilliant Workshop JV Example 3 Brilliant Deal!! JV Partner settles No cost to me Only 50% profit MINOR RISK!!! Profit HUGE Inc value from $422 to $730 in 12 months Secured + Agreement FIND = 25%MANAGE = 25% LOAN = 25%EQUITY = 25%

Ultimate Brilliant Workshop Equity Partner Puts in Equity for deal as loan Can include other costs as negotiated Doesn’t have a say in the project Expects a monthly return + Profit as negotiated Great for quick projects or longer projects Can be revalued to pay out partner Partners often use money from LOC or SMSF Low risk for Equity Partner

Ultimate Brilliant Workshop Equity Partner Example Long Term project Development – demolish current and build 7 Equity Partner doesn’t need money or income – profit on completion Equity Partners will lend up to 100% or more of the LVR on the potential of the property

Ultimate Brilliant Workshop Private Lenders Yes!! They exist..... Believe me Many forms from amateur to professional Some lend on 1 st mortgage to 70% VALUATION Others lend on 2 nd mortgage to 80% valuation (giving 10% extra funds) Develop relationships (valuable people) Can assist when in dire positions if deal is good Negotiable lending criteria

Ultimate Brilliant Workshop Private Lenders Example Coaching client refinancing property with bank Client purchased another property Did not have enough funds to settle Went in default (cheaper option) Private lender loaned $40K short term 4% per month Allowed deal to proceed only adding $3,200 to costs

Ultimate Brilliant Workshop Banks Funding Banks are brilliant!! We Leverage with them. Without them we would not be able to build wealth so easy They really are flexible if you work within their boundaries Brokers vs Banks change (now relationship management is great) Policies change frequently Learn as much as you can about lending

Ultimate Brilliant Workshop Banks Example – Blair Athol $385,000 Deposit paid with deposit bond $ Early entry Borrowed 80% from Bank + 80% Building contract $125K On settlement paid $4,000 Profit unbelievable!

Ultimate Brilliant Workshop Vendor Finance Example Common with commercial property 60-70% lending from Banks Owner leaves money in deal, amount is negotiated Asking price $440K Negotiated Vendor Finance Asking price changed to $660K!! Doesn’t always work

Ultimate Brilliant Workshop Creative Options Example 1 – Kilkenny Bank refused loan Planning approval 3 mths Private lender loaned on improved value 70% Contract price $240K, Valuation of $300K Private lender x1 loaned 70% = $210k other private lender loaned 10% = $30k Total = $240K!!

Ultimate Brilliant Workshop More Creative Example – Bowden Bank agreed to loan 80% Mortgage Insurance didn’t agree! Private lender 70% pp 2 nd Private lender loaned on 80% finished value (conservative) Enough funds to purchase and reno (no money in)

Ultimate Brilliant Workshop Being Sustainable Little or No money required good management It will – or will not hold you up from both starting and growing My model On completion 80% bank finance must cover 100% of all costs Forms foundation of Sell/Keep strategy Remember exit strategies

Ultimate Brilliant Workshop Being Sustainable Unley SA Purchased for 231K – 70% bank finance – 30% equity partner – Renovating, loan and settlement costs Renovated over 10 weeks total cost $300K Revalued once 80% LVR = $356K $300 paid everyone off, $56K into next deal

Ultimate Brilliant Workshop Savvy Suggestions!! Get to know your finance, “nobody will manage your money as well as you” Don’t take “no” for an answer Start with simple deals and build Money is abundant True success comes with an overwhelming hunger and surety of the outcome – I know EVERYTHING is possible

Ultimate Brilliant Workshop Debbie Williams b Prospect Rd Prospect SA

Ultimate Weekend Brilliant Workshop Ultimate Workshop 9-10 th April 2011