You Can't Handle the TRUTH!

By
Real Estate Agent with The Berkshire Group Realtors

Remember Jack Nicholson's famous line, "You Can't Handle the Truth?"

That's how I feel when I get a call from an "investor" who is just starting out. They just woke up the morning after watching a late night, "Make a Million Flipping Real Estate Part Time With No Money Down, in Less Than Month" cable TV presentation.  They are still waiting for The Tapes to arrive in the mail, but want to get started Right Now, by golly.

How can I tell?  Well  they usually tip their hat and give me a clue by asking to buy real estate "at wholesale".  Usually part of the conversation evolves around, "building my portfolio", I "only buy at wholesale" I'm looking for "fixers".  I want to buy a foreclosure.  No I don't do repairs.  I want to buy it cheap and only have to paint.

Sometimes I manage to bite my tongue rather than quip, "If I had one of those, I'd be buying it myself".  Or "sure, get in line."

Instead I ask them are you planning to pay cash?  If not, do you have financing in place?  Usually this stumps them because, well the TV said, "no money down."  Of course it didn't tell them that "no money down" doesn't mean you can do it with no money.  Duh.

The truth about flipping is this, if it were that easy, everyone would be doing it.  It's not easy.  If a property is in bad shape it's going to take more than paint to cure it.  Making it nice may mean, rebuilding parts of it, refurbishing or replacing many parts of it.  Sometimes IT will smell so bad you need to wear a mask to approach it.  Sometimes IT can't be fixed.

Are you the fixer-flipper millionaire to be prepared for this?  Save your money, cancel the TV tapes, the only person making a million is the one selling them.  Use your head.

Now that's the truth.  Can you take it?

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Rainmaker
1,092,043
Bryant Tutas
Bryant Tutas-Tutas Towne Realty, Inc - Poinciana, FL
Broker/REALTOR, Tutas Towne Realty, Inc
Hi Kristal, Good post. I get these calls all the time. They really a muse me. And I love "we want to buy a foreclosure". Usually they are first time homebuyers with no money wanting these "deals". The last foreclosure I personally purchased I was in a bidding war as normal, ended up paying 15% above list price and the only reason I "won" was becuase I was paying cash. Definately not for the faint of heart or first time homebuyer. I bet I could put together a CD though and make some real money! And that's the truth.   
Aug 22, 2006 07:44 AM #1
Rainer
75,576
Ann Guy
NA - Allentown, PA

I get the calls for the financing of these properties.  These clients also do not realize that the interest rate for a 100% investment property loan is not pretty.   

Aug 22, 2006 09:30 AM #2
Rainer
36,473
Sara Lipnitz
Max Broock Realtors - Birmingham, MI

Kristal,

I like to call it the "Urban Real Estate Ledgend".  Everyone knows someone who knows someone that made a small fortune buying a house that just needed painting.  Yeah right!  I love those calls.  I get them too.  These are the same people that think if they buy with us, we'll sell the house for free down the road.   

Aug 22, 2006 05:14 PM #3
Rainer
36,473
Sara Lipnitz
Max Broock Realtors - Birmingham, MI

In fact,

The "urban real estate ledgend" has just inspired my next blog.  So thank you very much!

Aug 22, 2006 05:15 PM #4
Rainmaker
226,829
Craig Schiller
Baird & Warner - St. Charles, IL

Um... not to be a snot... but if am going to spell KRAFT correctly, you gotta qoute Jack correctly.  He said... " You can't handle the truth!" 

 

Aug 22, 2006 07:44 PM #5
Rainmaker
459,318
Alexander Harb
Knights Investing - Mesquite, TX
Dallas, Texas Real Estate Investing
I am partially with Craig, sister....ya got the quote wrong babe.....;-D
Aug 22, 2006 08:07 PM #6
Ambassador
668,252
Kristal Kraft
The Berkshire Group Realtors - Denver, CO
Denver Real Estate - 303-589-2022
OK, guys you are right.  I changed it.  Thanks for correcting me!
Aug 23, 2006 11:55 AM #7
Rainmaker
221,627
GARY DIGIORGIO -Denver- Arvada -Westminster
THE DIGIORGIO GROUP /(303) 898 - GARY (4279) - Westminster, CO
REOptions LLC

awe...did u copy my jack quote...great

Gary

Mar 15, 2010 12:14 PM #8
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Kristal Kraft

Denver Real Estate - 303-589-2022
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