Ultimate Workshop

1. UltimateWorkshop 9-10th April 2011

2. Creating Brilliant DealsWith Little or NO Money DownDebbie WilliamsPrinciple : Savvy Property People

3. 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

4. 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?

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

6. 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

7. 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

8. 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

9. JV Example 3 • Brilliant Deal!! • JV Partner settles • No cost to me • Only 50% profit • MINOR RISK!!! • Profit HUGEInc value • from $422 to $730 in 12 months • Secured + Agreement

10. 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

11. 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

12. 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

13. 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

14. 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

15. 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!

16. 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

17. Creative OptionsExample 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!!

18. 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)

19. 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

20. 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

21. 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

22. Debbie Williams 0428 192 950 debbie@savvypropertypeople.com.au 82b Prospect Rd Prospect SA

23. UltimateWorkshop 9-10th April 2011