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| 1964 Westwood Blvd, Suite 350, Los Angeles, California 90025 ©2016 Patch of Land, Inc. All Rights Reserved. ©Patch of Land, Inc is the originator and lender of record. NMLS#1286539; CFL License 60DBO-45420; Oregon Mortgage Lender License #5384. We currently lend in all states except for the following: AZ, MN, NV, SD. Origination fees and other fees may apply. This is not an offer to lend. Any financing will be subject to a credit evaluation, approval of the subject property, and other restrictions. Terms and conditions are subject to change. To qualify, a borrower must meet our underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must meet certain conditions. Your actual rate will depend on a variety of factors. Rates and Terms are subject to change at anytime without notice. |
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Improving Quality of Life Through Real Estate Investment – An Interview with Dennis Henson
Dennis Henson has been investing in real estate longer than most real estate experts have been out of diapers. He’s seen the market from every angle, seen it rise and dip, and rise again – by Tim Houghten
Today Dennis Henson heads up the Arlington Real Estate Association (of Investors), and the comprehensive training portal Single Family Fortunes, which has seen one student recently soar to acquiring 23 properties in just 8 months. So what’s enabled him to not only maintain success, but successfully train others to get in and win?
Here’s the inside scoop…
How did you get started in real estate?
Dennis: “A combination of moving up from living in a small house to a large one, and badly renting out the old home, and then reading ‘How To Wake Up The Financial Genius Inside You’ by Mark O. Haroldsen.”
If there is one thing you could credit your success to, what would it be?
Dennis: “Maintaining a burning desire to succeed.”
How did you make president of the Arlington Real Estate Association?
Dennis: “I started the group in order to become more knowledgeable about REI Topics. For example; probate. If I had to do a class on that subject in front of 50 to 100 people – you can bet I was going study, learn about that topic, and master it.”
What’s different about your training system from what else is out there?
Dennis: “Many of the other teachers focus on one technique for examples Short Sales or Wholesaling. The biggest difference is that my training covers all areas of REI. I call it the 5 M’s of Real Estate Investing.”
- Mining
- Money
- Maintenance
- Marketing
- Management
You have students who report achieving very significant results, very quickly. What makes the difference between them and the rest of the wannabe investors out there?
Dennis: “My training is one on one, and I am very interested in their success. There is nothing magic about my training. It is just combining knowledge with hard work. I have a system that works, if they do. ”
You have a slogan “Improving the quality of people’s lives through real estate investing” – what does that mean to you?
Dennis: “Well that is my motto. My goal in life is helping others become more successful so that they can enjoy a better quality of life. What is a better quality of life? It is being able to have the freedom to do the things you want to do, going to the places you want to go, and having the things you want to have.”
Where do you see the best opportunities in real estate ahead?
Dennis: “I believe that REI always has, and always will have the greatest opportunities for those who are willing to learn and work hard. The number one need for a human is shelter. Do you ever watch those survivor reality shows where they leave someone stranded in a jungle or on an island? What is first thing they need? Not water, not food, but shelter. It is the most basic human need, and always will be. If there is a disaster people will not be needing stocks or bonds, or gold or silver, but they will be needing shelter. So I think REI will always be a great business for my students and association members.”
Where do you see the best opportunities in real estate ahead?
Dennis: “I believe that REI always has, and always will have the greatest opportunities for those who are willing to learn and work hard. The number one need for a human is shelter. Do you ever watch those survivor reality shows where they leave someone stranded in a jungle or on an island? What is first thing they need? Not water, not food, but shelter. It is the most basic human need, and always will be. If there is a disaster people will not be needing stocks or bonds, or gold or silver, but they will be needing shelter. So I think REI will always be a great business for my students and association members.”
What’s the best strategy for those that fear the market may be in for a correction soon?
Dennis: “Buy lots of properties. When the people are not buying houses, what are they doing for shelter? Living in a cave? No, they are renting; so the rental market will be booming.”
Interested in learning more about Dennis Henson, his training, and the Single Family Fortunes he has empowered others to create? Look out for Dennis and his wife Norma at upcoming Realty 411 Expos, listen in to him speaking on Blog Talk Radio, and visit his website at SingleFamilyFortunes.com, where you’ll find a FREE TRIAL for an online app that helps you evaluate your deals faster.
An Education in Private Lending by Bruce E Dinger, CEO Kennsei Trading, Inc.
WHAT IS PRIVATE LENDING?
A private money loan is a loan that is given to a real estate investor, secured by real estate. Private money investors are given a first or second mortgage that secures their legal interest in the property and secures their investment. As REI,when we have isolated a home that is well under market value, we give our private lenders an opportunity to fund the purchase and rehab of the home. Through that process, the lender can yield extremely high interest rates – 4 or 5 times the rates you can get on bank CD’s and other traditional investment plans.
Essentially, private money lending is a lender’s opportunity to become the bank, reaping the profits just like a bank would. It’s a great way to generate cash flow and produce a predictable income stream – while at the same time, provide excellent security and safety for your principle investment. You can do what the banks have been doing for years…make a profitable return on investments backed by real estate. There is no other investment vehicle like it.
Through private money lending, lender’s have the opportunity to become the bank.
HOW THE PROCESS WORKS
The process is simple. The Residential Redeveloper (RR) finds an extremely undervalued property to purchase – and once lender gives the green light, the RR borrows the funds to purchase and renovate the property. At closing, the lender receives a mortgage on the home along with other important documents. Next stage is the property renovation. Once the renovations are complete (typically 3-6 months depending on the size of the project), the RR will list and sell the property.
When it’s time for closing, the lender receives his principle plus 10% interest payment. It’s just that simple! The goal is to keep turning that money for the lender and keep them making substantial profits so they keep coming back – building a long term mutually beneficial relationship.
HOW THE LENDER BENEFITS FROM PRIVATE LENDING
The private money lender (PML) can benefit greatly from investing their capital. A real estate mortgage/ deed of trust provides them with security instruments they would not get with other investments. The PML also has added layers of protection because of how the RR buys, and because the PML has recourse available in case the RR were to default on the loan.
RR currently pay 4-5 times what a typical bank CD is paying. Rates may fluctuate some, but not much, depending on the purchase price and rehab involved. The lower the price the RR pays for a home, the RR can pay a little higher rate to make sure the lenders make it worth their time. Private lending means the PML can relax while the money is in a truly safe place, working for them.
Done correctly, equity is built in the purchase of the home, educated RR are buying 30-40% below a retail buyer – that creates instant equity at purchase. Also, in a typical transaction, RRs cut out the middleman cost, such as: commissions, mortgage broker fees, loan fees; and attorney costs are also lower because there is less work for them to review.
An experienced and educated RR is able to offer buyers a fully renovated home at or below everything else in the neighborhood. The goal is to buy right so you can attract a wide variety of PMLs for your projects….keep in mind, RR make money when we BUY.
HOW PRIVATE MONEY HELPS YOU AS A RESIDENTIAL REDEVELOPER (RR)
Private money lenders bring speed and efficiency to the RR’s transactions, and their leverage is far greater when they purchase using private cash funds. Many of the homes RR purchase are in need of a quick sale within 10-14 days. A traditional bank requires 30-45 days to close a loan. Many traditional home sales fall out of contract because of financing issues. Using quick cash as leverage allows the RR to negotiate a much lower purchase price and reduce risk.
Being able to offer a fast closing with private funds motivates sellers to take the RR’s offer over the competition, and entices them to take a much lower price than they would from a conventional buyer. Also, lending guidelines are also continually changing and are requiring applications, approvals, junk fees and strict investor guidelines. They also limit the number of investment properties that can be purchased by one company.
On a new home purchase requiring renovations, private lender funds will be allocated to the purchase price, renovations, carrying costs, cost to resell and a small buffer for unexpected expenses.
PROTECT YOUR LENDERS
Mortgages offer the banks solid, long-term, fixed returns. The PML can put themselves in the position of the bank by directing their investment capital, including retirement funds to well-secured real estate mortgages. Mortgages have ultimate safety because if default occurs, the bank can recover its investment as the first lien holder on the property.
Each property acquired should be put through a rigorous evaluation process in order to assess the profitability before the property is ever purchased. “lntegrity” should be an essential part of the RR’s business. Also, for the PML’s protection, the PML should be provided these documents to secure their investment capital:
- Promissory Note: This is the PML’s collateral for their investment capital
- Deed of Trust/Mortgage: This is the document that is recorded with the county clerk and recorder to publicly secure their investment against the real property that the RR is providing as collateral
- Hazard Insurance Policy: This is where the private lender would be listed as the “Mortgagee” for their protection in case of fire or natural disaster, etc.
The RR would pay for a title search as well as a title policy on the home just as would be done in a typical transaction. For a rental investment with a long-term note, the RR always keep a valid hazard insurance policy on the property to protect against causalities. The PML will be named as a mortgagee and notified if the insurance was not kept current. In the event of any damage to the property, insurance distributions would be used to rebuild or repair the property, or used to repay the PML.
About Kennsei Trading, Inc.
Kennsei Trading Inc. is a Registered Investment Company – specializing in building wealth through the financial markets, including the stock and equity markets, and the real estate market. The firm is lead by CEO Bruce E Dinger, who has over 20 years experience as an investor.
Kennsei Trading Inc. has an extensive network of private money investors and understands the thought process of a savvy investor and what they look for in any investment prior to the deployment of their capital.
Join Bruce Dinger for an incredible session on “Raising Private Money for Your Properties and Learn Key Cash Flow Strategies”. Also get an opportunity to tap into his Inner Circle of Private Money Investors looking for key investments.
Bruce Dinger can also be reached at [email protected] or 408.639.9793.
Single-Family Rental Summit in Texas – Get Discounted Tickets Here!
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