ultimate weekend brilliant workshop ultimate workshop 9-10 th april 2011

Ultimate Weekend Brilliant Workshop

UltimateWorkshop

9-10th April 2011


Creating Brilliant Deals

With Little or NO Money Down

Debbie WilliamsPrinciple : 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


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?


Alternatives

• Joint Ventures• Equity Partners• Private Loans• Banks • Vendor Finance• Creative Options• Being Sustainable


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


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


JV Example 2• Boarding house for sale!• No Money!!• Sell 4 shares

—3 @ $40K (mine free)• 5 Year plan for exit• Share the income and expenses• I have bank loan & ownership, others secure

with caveat


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%


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


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


Private Lenders• Yes!! They exist..... Believe me• Many forms from amateur to professional• Some lend on 1st mortgage to 70% VALUATION• Others lend on 2nd 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


Private LendersExample

• 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• Unsecured @ 4% per month• Allowed deal to proceed only adding $3,200 to costs


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


BanksExample – Blair Athol

• Contract @ $385,000• Deposit paid with deposit bond $385.00• Early entry • Borrowed 80% from Bank +

80% Building contract $125K• On settlement paid $4,000• Profit unbelievable!


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


Creative OptionsExample 1 – Kilkenny

• Bank refused loan• Planning approval 3 mths • Private lender loaned on

improved value 70%Contract price $240K,

Valuation of $300KPrivate lender x1 loaned 70% = $210k other private lender loaned 10% = $30k Total = $240K!!


More CreativeExample – Bowden

• Bank agreed to loan 80%• Mortgage Insurance didn’t agree!• Private lender 70% pp• 2nd Private lender loaned on

80% finished value (conservative)• Enough funds to purchase

and reno (no money in)


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


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 finished @445K• 80% LVR = $356K• $300 paid everyone off, $56K into next deal


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


Debbie Williams 0428 192 [email protected]

82b Prospect Rd Prospect SA

mailto:[email protected]


UltimateWorkshop

9-10th April 2011

ultimate weekend brilliant workshop ultimate workshop 9-10 th april 2011

Documents

property slide

equity partner slide

brilliant deals

sustainable slide

grandmother slide

component slide

caveat slide

conclusion slide