How should you study all the information on the website?
1. Read everything on this website.
2. Take the free e-course.
The purpose of the e-course is to explain cash flow/note brokering and investing in detail — I took my 3-day course and distilled it to the bare-bones essence and made it the 7-part free e-course. When you have finished it you will have a good idea of whether or not you want to proceed. If you do…
3. Take either the Home Study Course or get The Complete Package (see the tabs). The difference is that the Home Study Course is a step-by-step path with manuals and 20 CDs. It is also more expensive than The Complete Package, which is a huge amount of reading (downloads) that comes with a brief study guide.
If you listen to the pitches for the multi-thousand dollar seminars, you will retire rich from your first deal. Unfortunately, it doesn´t work quite like that. The first thing you need to understand is that the note business is simply another small business. A very, very good one for some folks, true, but still a business, not the magic bean that will make you rich without working.
Suppose instead of opening a note brokering business you decided to open an accounting practice. Would you think you could do this without having any training to be an accountant? Without investing any money in starting your new business? Without investing money in advertising? Would you expect to start making a profit immediately? Would you think you´d make $100,000 your first year? Would you think you might be making half a million or more real soon?
Pretty ridiculous, right? You probably know that something like 90% of new businesses fail in the first five years. Here´s our dirty little secret: The failure rate for people who take the expensive cash flow brokering courses, seminars, boot camps, mentoring, coaching, etc. is 99% in the first year. (That´s not a figure I just pulled out of a hat. It comes from a study by NEWSWEEK.)
HOWEVER, the reason for that statistic is that nowadays the majority of people trying to broker notes heard about it on a TV infomercial, they were sold on notes as a get-rich-quick scheme and made all sorts of promises, so their expectations are wildly inflated. When they find out that it, like any small business, is hard work, they quit. There are no studies, but my 20-some years of experience tells me that the success rate for people without such expectations, who approach this as the serious business it is, and who have some financial or real estate background, is much higher.
A final thought: Please, please, please, do not try this without having another source of income. This is a part-time business for all but a few. You´ll make a nice side living and maybe someday you´ll go full-time. Let your note business tell you when that time has come. How do you know? When you discover that you´re making more money doing notes than your regular job, and that you enjoy it more. Then give that situation a year or two. If nothing changes, then, and only then, make the jump to full-time.
It´s a tough business, and only the most driven, most of whom have another source of income, survive to become full-time note brokers. They find it is one of the most lucrative businesses there is. They make a good to a great living, and the potential is huge. The top 10 brokers for the biggest note buyer averaged $8.3 million in volume in real estate notes in a recent year. At an average 5% commission, they grossed $415,000. This figure does not include profits from brokering lotteries, structured settlements or annuities, the major categories of “alternative paper,” which typically produce windfall commissions of tens of thousands and very occasionally over $100,000. At this level these brokers have a small staff and the typical overhead of a business of this size. Plus they spend a lot in advertising and marketing. These are brokers. Investors make more, sometimes much, much more. And every broker´s goal is to become an investor as soon as possible.
Who are you guys & how do I know I can trust you?
Let’s see…Would it convince you if I said, “Hey, we´re different! We´re not in this for the money, we do it because we love you!”?? No, I didn´t think so. So how do you know that we´re not a bunch of con artists? One way I check people out is to look at their feedback on eBay if they have it. Feel free — my username is reformedelder.
The fact is that we’ve been in business longer than anybody else publishing in this industry. We also put on the first national convention for the industry. We published the first directory of cash flow note investors (and still publish it). My wife Alison and I are the only employees — low overhead means low prices for you. We started buying & brokering notes in the early 1980s and published the first issue of THE PAPER SOURCE JOURNAL in 1987 and have been publishing ever since. And it´s a fact that more cash flow note professionals read THE PAPER SOURCE JOURNAL than any other publication in the industry.
We’ve been quoted in The Wall Street Journal, Newsweek/Jane Bryant Quinn´s national column (several times), USA Today, several national columnists for Gannett and other newspaper chains and more. I could tell you about being inducted into the Mortgage Report Hall of Fame in 1997. I could tell you about receiving the first and only Founder´s Award from the Mortgage Report Hall of Fame, “For Pioneering The Original Industry Newsletter; Establishing The First National Convention For Note Brokers; For Leading Where Others Have Followed; And For His Significant Role In A Developing Industry; This Founders Award Is Conferred Upon William J. Mencarow…” yada, yada, yada. I could tell you about being inducted into The Note Buying Industry´s Hall of Fame (yes, there are two halls of fame; must be a big building) and the crystal obelisk sitting in my office bearing the inscription: “In appreciation of his many years of unwavering dedication and outstanding contributions, William J. Mencarow…,” ditto yadas.
Are you bored yet? Don´t get me wrong, I am very humbled by all this, and I cite them only to put you at ease that we aren´t interested in stealing your money. What we are interested in doing is teaching you more about cash flow notes and giving you more for your money than you will get anywhere else. But you have to decide for yourself if this is true. How do you do that? John T. Reed, publisher of Real Estate Investor´s Monthly newsletter, wrote a great article called “The Real Estate B.S. Artists´ Detection Checklist.” Read it, then test us and everyone else against the checklist. It´s on his website at www.johntreed.com Also check me out at his “gurus rated” page: www.johntreed.com/BSchecklist.html). If you want to know more about us, click the tab “About Us.”
Should You Broker Lotteries and Structured Settlements?
You very likely will not be able to create a viable business brokering only structured settlements and lotteries. Every broker I know of, and that is a lot, depends upon real estate notes for the vast majority of their business. There are no courses because for the broker, unlike real estate notes, it is much less complicated because the investors want to do most of the work themselves. It is a matter of finding the lotteries and structured settlements and then contacting an investor, who will tell you what to do from there. You certainly don´t have to pay someone thousands of dollars to learn it. The mainstay of virtually all successful note brokers is real estate notes. Structured settlements, lotteries, annuities and other non-real estate paper can be a lucrative addition to brokering real estate notes. To learn more about brokering lotteries and structured settlements, go to THE CASH FLOW DOLLAR STORE “Cash Flow Niches” aisle (in the left margin, click “Training/Home Study” then “Cash Flow Dollar Store”or visit www.cashflows.org).’
Should you be a full-time or part-time cash flow note broker?
IF YOU ALREADY HAVE A JOB: Don’t give it up now! Do not try to be a note/cash flow broker without having another source of income. Brokering commissions come in slowly and are usually few and far between at first. I tell people to plan on making NO money for the first 6 months. Cash flow note brokering is a part-time business for all but a very few. You´ll make a nice side living as a broker, and maybe someday you´ll go full-time. Let your brokering business tell you when that time has come. How will you know? When you discover that you´re making more money as a note broker than in your regular job, and that you enjoy being a note broker more. Then give that situation a year or two. If nothing changes, then, and only then, make the jump to being a full-time note broker. In other words, when you´re starting out, “don´t quit your day job.” IF YOU DON´T HAVE A JOB: Look for one while you broker notes.
Can you get a credit report without permission of the creditor?
Lorelei Stevens, President, Wall Street Brokers, Inc., has been spearheading this question on behalf of the note industry for years — unofficially, of course, since there is no organized “note industry.” (Reminds me of Will Rogers’ comment, “I’m not a member of any organized political party. I’m a Democrat.”) She’s corresponded with credit bureaus, state regulators, hired attorneys and has engaged in a continuing dialogue with the Federal Trade Commission over the legalities. Lorelei faxed a copy of the Associated Credit Bureau’s analysis of the Fair Credit Reporting Act. It says: “Section 604(a)(3)(E) creates a permissible purpose for potential investors, servicers or insurers of credit obligations to obtain consumer reports for the purpose of evaluating or assessing the credit or prepayment risks involved in existing credit obligations of consumers. For example, an entity that plans to invest in a mortgage loan transaction would have a permissible purpose under this section to obtain a consumer report on the borrower in that transaction.” The industry owes a debt of gratitude to Lorelei Stevens for her tenacity in monitoring this issue.’
How do investment swindles work?
See www.papersourceonline.com/swindles.htm
How can I spot a rip-off?
The cash flow/note business is not a get-rich-quick scheme, despite what you may have been told. It can be an excellent get-rich-slowly plan. The hucksters use mass marketing techniques to sell it as the latest road to fabulous wealth. It IS making THEM wealthy. One of those pitchmen, whose conscience got the better of him, confided to me that another cash flow pitchman was always introduced as follows: “Now, ladies and gentlemen, here is a man who has made millions with the information he´s about to share with you!” Pretty impressive, right? Here´s the rest of the story: Yes, he made millions with the information he gave the marks, I mean, the audience (in case you don´t know, a “mark” is a carnie (carnival) term for a sucker). But it´s not what you think. Those backstage got a big laugh when he was introduced that way. Why? The “information” his millions came from was his sales pitch for his products and “boot camp”! No one has the secret to getting rich quick. If they did, why would they tell the world about it? They´d be too busy using their secrets to get rich. Count on it: ANYONE WHO SELLS ANYTHING PROMISING EASY RICHES IS CONNING YOU. “The plans of the diligent lead surely to plenty, But those of everyone who is hasty, surely to poverty.” — Proverbs 21:5 Instead of trying to get rich quick you should be trying to (in the words of Jimmy Napier) get smart quick. And smart people are much more likely to get rich than others.
Help! I’ve been ripped off!
If you’ve been victimized by a seminar promoter, contact your local and state consumer protection agencies and your state Attorney General. You also may file a complaint with the Federal Trade Commission online at https://www.ftccomplaintassistant.gov/ or call 1-202-FTC-HELP or write: Consumer Response Center, Federal Trade Commission, Washington, DC 20580. Although the FTC cannot intervene in individual consumer disputes, the information you provide may indicate a pattern of possible law violations requiring action by the Commission. You may also wish to consider filing a class action lawsuit. Contact an attorney and discuss the possibilities.
