Kim and I LOST $217,300 because we FAILED to do a Pure Option deal.
Just got off the phone with an investor who said, “Bill, the early-bird special of $647 for your Power of Pure Options seminar is pretty steep.”
“Maybe so,” I replied, “but have you considered the amount of money you’ll lose if you’re NOT at May’s seminar in Tampa?”
Here’s how Kim and I lost $217,300 because we failed to use a Pure Option on a single deal.
In February 2011, Kim and I were working foreclosures in Adairsville, Georgia. A target property we found was on Adairsville Pleasant Valley Road. The borrowers owed over $100,000. The house was vacant. We couldn’t find the owners.
We loved the house and wanted to buy and keep it as a rental. The problem: The fair market value was only $85,000 – way below the loan balance, plus it needed an $8,300 rehab.
Kim called the lender and began working the lender’s top bid. She successfully helped the lender understand their sale number was way too high. They lowered their opening bid price to about $57,000. Kim and I were the only investors with this information!
At the same time, a friend of mine (we’ll call her K.K.) told me she was going through a divorce, needed a nice home, but couldn’t pay more than $80,000. She had two young kids. I knew this foreclosure property would be perfect for them.
I promised to help K.K. buy the property at the March 3, 2011, foreclosure auction. IMPORTANT: Without our help, there was no way K.K. would have known about, or know how to buy, this property. To boot, in helping K.K., Kim and I would be giving up a great investment property.
There was an incredible deal structuring tool in my toolbox that I failed to use. My mistake COST us $217,300!
At the March 3, 2011, Bartow County foreclosure auction, K.K. was the top bidder at only $57,700. Incredible deal, right? What did Kim and I get? Nothing, nada, goose egg. Not even a thank you card.
How should this deal have been creatively structured? Because K.K. was able to buy a great house at way below market due to our effort and know how, we should have gotten a Pure Option to buy this property from K.K. at any time over the next 30 years for K.K.’s purchase price of $57,700.
Would K.K. have agreed to this? Absolutely! Why? Her other choice was to not own this beautiful home and instead be our tenant paying ever-increasing rent.
Today this home is worth about $275,000. By not doing a Pure Option deal, I made a $217,300 mistake ($275,000 FMV – $57,700 purchase price = $217,300).
How would YOU feel if YOU made this mistake? Do YOU think knowing how to do Pure Options can be a valuable deal structuring tool?
Understand, you are paying for May’s Power of Pure Options Seminar whether you attend or not. If you’re not there, your cost could be hundreds of thousands of dollars in missed deals.
Do YOU think it would be idiotic to repeat MY stupid mistake? We look forward to seeing you on May 21st & 22nd in Tampa, Florida at the Power of Pure Options Seminar. Go to BillandKimCook.com to reserve your seat!
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