ICG Blog

Want To Invest In Foreclosures? Why This Is Not Where You Make Your Millions

Simple Reasons Why Foreclosure Investments Are a Bad Idea
There are some people who are convinced that investing in foreclosures is the way to go; that this is the way they are going to make the millions that they dream of. I would gently disabuse people of this mistaken notion. Foreclosure investments are neither as common nor as simple as people believe them to be. For a number of reasons foreclosure investments are not advisable. In this economic climate, the idea of making big money off of foreclosures is going to remain a pipe dream mostly. I explain why here.

What are foreclosures and when do they happen?

Simply put, foreclosures happen when a person is unable to make payments on a property loan they have taken. In such a situation, the bank or financial institution, who is the lender /mortgagee in this case, will ‘foreclose’ the property. They will auction off the property to recover their dues. Theoretically, it makes sense to invest in such foreclosures because banks and other lenders basically want to sell off and get the property off their hands. They don’t want to be stuck with a non-liquid asset that they cannot lend or otherwise monetize, so you can buy cheap.
But think about it – when does a foreclosure actually happen? Well, first the borrower or mortgagor defaults on their payments. Then the lender sends notices and then proceeds with the foreclosure – a process that will typically take months. In the meanwhile the property owner has other options – especially now when it is more or less a seller’s market. Our recent experience has been that in a lot of markets, people receive multiple, excellent offers as soon as they put a property up for sale.
So why would any homeowner let it get to the foreclosure stage when they have other, better options? In the past, when times were tough, banks were foreclosing thousands of properties. So during the 2008 recession and for years after that, this would have made sense. However, it doesn’t anymore, particularly now in these COVID times as I explain in this short video. And that is why I say that right now foreclosure investments remain a bit of a pipe dream.

Still thinking about foreclosure investments? You must be brave!

Why brave? Because buying foreclosures is a lot more complicated than it seems. If you decide to bid for a property that is undergoing foreclosure or intervene in a suit, there is a lot you would have to check – are the property titles clear? Is there some other lien or pledge on the property or IRS issue? Foreclosure investments need significant expertise and experience. Plus in my experience, parties sometimes collude with each other as well. I have seen people being financially destroyed as a result of this.
For all of these and other reasons, I advise people against investing in foreclosures. There are other sounder, better investment opportunities out there for you. Get in touch with us to know more.

How to Buy More than Ten Homes and Get Financing for Them

Why the Limit of 10 Fannie Mae Loans Does Not Matter          
Everyone who is familiar with me and the work I do knows that I have personally bought hundreds of homes by way of investments for myself. However, there is one question I get a lot from my clients and those who attend our real estate seminars. Can we get more than ten loans? If so, how? These questions are of course related to the Qualified Mortgages or Fannie Mae loans as we colloquially call them.

Buy more, I tell them.

I always advise our clients to buy more homes – 5, 10, 50 or 100 – as many as they possibly can. Because the more homes they buy, the greater passive income they generate and the more their wealth grows. I give the example of myself as someone who bought many, many homes as part of my own investment portfolio. So how did you manage to buy so many homes when one individual can get only 10 loans,” they ask me.
Now there is no doubt that the 30-year fixed rate loan is a gift that no one can or should refuse to take. However, the ceiling of just 10 loans for each individual – which includes the homes one stays in, by the way – is a bit of a dampener, isn’t it? You could say that it is. So what are your options?

How to get more than ten loans.

The first thing to remember is that it is ten loans per individual, so married couples can get up to 20 loans between them. If both spouses are earning, they are seen as a bankable risk and financial institutions can advance up to 20 loans. So that right there is one family’s increased capacity to create future wealth for itself.
And then there are the non-QM loans or the non-qualified mortgage loans. Sure, the terms of those loans may not be as favorable as the Fannie Mae loans but these are good loans to take. It is, in fact, possible to get these loans that are repayable over a 30-year period and at a fixed rate! The rate may be a little higher but this is still a great option! Watch this episode to know why I think the ten loan limit is irrelevant, and creating retirement riches is within everyone’s reach. 

What Warren Buffett Said About the 30-Year Loan, and Why I Agree

I think that we would all agree that if Warren Buffett gives financial advice, it is going to be worth listening to. He has been one of the richest men in the world for many years now, and his unconventional financial wisdom means that he is widely considered to be the most successful investor of the 20th century. So, without doubt, it feels great to have one of my ideas validated by Warren Buffett himself. Watch this to know which one. 

Warren Buffett and the 30-year loan.

In a very recent article by Maurie Backman titled Warren Buffett’s 5 Best Pieces of Money Advice, Buffett said that he is a big fan of financing a home with a 30-year mortgage, especially when rates are low. 
“When you take out a long-term loan, you buy yourself flexibility by not locking yourself into the higher payments that come with a shorter-term loan.”
According to him, with interest rates as low as 2% it is a no brainer that people should finance their real estate purchase using this instrument. This low rate spread out over a 30-year period makes it an incredibly attractive option. And guess what? I agree!
I’ve been advising my clients and viewers on the same lines.
I had engaged in some personal correspondence with Warren Buffett sometime in 2012. This was after the recession, and at the time he had written to me that he was interested in buying 70,000 to 100,000 homes for Berkshire. He told me that he wanted to get a 30-year loan to finance each of the homes he bought. In his view, with only a 20% down-payment requirement, it really didn’t get any better! No wonder the 30-year loan recommendation happens to be one of his top five financial tips.

Why I recommend 

the 30-year loan.

I have myself relied on the 30-year loan to invest in real estate over the years, and it has worked really well for me. I advise my clients to do the same because I believe it is a gift that no American should refuse – and it has worked really well for them as well. Believe me, foreigners can hardly believe that such a long term, fixed rate loan is actually available to Americans!
The reasons why I – and world famous experts like Buffett – recommend this loan are easy to understand. With low interest rates and fixed repayment amounts spread out over 30 years, this loan becomes easier and easier to repay. Inflation and rising cost of living do not impact the amount you pay each month; it remains the same. So at the end of say 10 or 15 years, the amount you’re paying each month seems to be little more than a fancy dinner somewhere!
Now there is a catch of course. Warren Buffett wanted to finance thousands of homes with the 30-year loan, but there is a limit to how many loans you can take out. Each individual can take out no more than 10 of these loans. A married couple can get 20 loans between them. So how do you buy more homes as I advise you to do? There is a way. This is also one of the topics we will talk about at our next online Property Expo, and you are most welcome to attend.

Why and How Much I’ve Invested in Real Estate All These Years

I Practice What I Preach –– It Just Makes Great Investing Sense
 
For many years now, my firm ICG or the International Capital Group Real Estate Investments has been helping people invest in real estate to grow their wealth. ICG has helped them secure their retirement riches, fund big purchases, kids’ education or just a higher standard of living, they tell me. But they also ask me, Adiel, do you follow your own advice? Do you invest in property as you advise others to?

I am ICG’s biggest investor.

My answer to them is, I absolutely do follow my advice. It is my own experience that has taught me that brand new single family homes are the best option. It all started with me wanting to create wealth for myself. As a Silicon Valley engineer, I wasn’t content to just keep grinding away with nothing much to show after decades of hard work.
So, ICG is something that I started for myself and a small group of investor friends. It was born out of my desire to create an empire for myself. It grew from then on, but I still continued to be the biggest investor for the firm. I have invested in literally hundreds of properties. We have closed thousands of deals over the years, and those include my own investments as well. So yes, I certainly follow my own advice and I continue to invest in real estate – same as I tell my clients.

Getting the ICG advantage.

If you choose wisely, the property will start to yield a rental income right away and the prices will appreciate over time to give you great longer term benefits. This is what we help you do at ICG. People tell me how ICG has helped them connect with developers, financers, property managers and so on. We have our ear to the ground and have a network of connections that make it all very simple for investors – what we call remote control investing.
The bottom line is that I put my money where my mouth is. I own more properties than any other ICG investor. Over time, I gained valuable insight into the business of real estate investments and this is the insight that my team and I share with our clients.
I have bought hundreds of homes, and I would buy even more properties than I currently have – except for this small issue. Click to find out what it is.

Investing in Real Estate with ICG Means Amazing Service – But What Will It Cost You?

 
So, here’s a question I get asked often by investors, after I’ve explained the advantages of working with ICG: what will it cost me? When I explain how, in most cases, it’s going to cost them nothing, the next question is something like – what’s the catch? Or, then how does ICG make its money? These are legitimate questions, because we all know, there’s no such thing as a free lunch. The answer is, yes, ICG does get paid. However, it isn’t you, dear investor, that pays us.

The ICG Real Estate Advantage.

When you work with us at ICG, you are introduced to a whole network of builders, realtors, property managers and even financers. You are given a variety of options and there is always someone there to show you the ropes. I have worked long and hard to simplify the process of real estate investing for my clients, and it works – whether an investor wants to buy one or one hundred homes!
It’s a self-sustaining system, as I explain in this short video. There are a lot of people that are beholden to ICG for bringing buyers and customers their way. It is these people who share their commission with us: realtors, property management teams and so on. However, there are times when buyers have to pay a small amount – as in the case of the Raleigh-Durham area. Here, commissions are really low right now and buyers are having to make up the difference in terms of the brokerage.

Can you afford not to have the ICG advantage?

I think of my own property portfolio as the best advertisement for ICG Real Estate. People see how well I have secured my own financial future and they want ICG to do that for them! We deal in volumes – while the amounts that we make from our various business partners may not be large amounts, it all adds up to a lot.
So really the question you should be asking is not, can I afford to work with ICG, but can I afford to not work with ICG? Check out this episode to know what it’s all about, and check out ICG Events to find out about exciting real estate investment opportunities that you cannot afford to miss.

Where NOT To Buy Real Estate & How to Safeguard Your Investments

At ICG Real Estate, we are all about helping you build a secure financial future with savvy real estate investments that are going to fetch you the best possible returns. We crunch the numbers, look at growth trajectories and weed out areas that don’t make sense. We then facilitate your investment by giving you access to our network of developers, property managers, financers and so on.
This helps you and also helps strengthen our networks. So really, it’s a win-win for all concerned. However, it is important to invest based on sound market insight and not get carried away by what is trendy or just doing what everyone and their cousin are doing right now.

Territories that just don’t make sense right now.

There was a time when territories like Boise (Idaho), Baton Rouge (Louisiana) or Salt Lake City (Utah) made a lot of sense for real estate investors. At the time this made sense for people who wanted to buy, bide their time and reap good profits ten, fifteen or twenty years later.
Right now, however, these territories aren’t a good idea at all. There are no properties to buy and not even any waiting lists you can get on. Each time someone puts up properties to sell, buyers seem to be jostling to buy. Common sense tells us that we don’t buy in a sellers’ market. 
So where do you buy?

The ICG Advantage.

Now your financial aims may be varied – you may want to finance college for your kids or even grandkids. You may want to ensure a comfortable, even luxurious retired life. Or you may just want to have a financial fallback of sorts. Whatever your aims, right now, investing in single family homes in carefully chosen real estate markets seems to be your best bet. Not only does ICG Real Estate examine future growth prospects, but we also examine numbers that make sense in terms of rent – a passive income source for our investors.
Like I said, it’s a win-win for our investors – who pay nothing extra – and for us because it helps us strengthen our networks. You can contact us to set up an investment meeting, or ask us to send you exclusive property listings. You can also attend our quarterly Expo events where we talk about real estate investments and have a lot of fun! We even have teams present from the markets that are good to invest in to share their insights with you.  Reach out to us if you have a question or if you’re ready to take the next step to safeguard your financial future – we can tell you how!

Investing In Real Estate in San Francisco? Why You Should Avoid This Mistake

 
San Francisco is a great place to live in as most people living here will tell you. But it is not a good place to invest in real estate! It never has been, as I explain categorically to people who come to me for advice. In fact in this short episode I explain why it has never really been a good real estate investment destination, for several reasons.

Think about rental incomes relative to property value.

Property prices in the SF area have appreciated over the decades. However, this is not the only criterion for wise real estate investments. Rental income is an important factor as well. Now it is true that rents are fairly high in San Francisco if we speak in absolute terms. However, the rent is not high relative to the value of the property here. (In this short video I explain and illustrate with some numbers. In order for your real estate investment to make sense, your rental income has to be commensurate with the value of the property you buy. Otherwise it doesn’t make sense for you as an investor.

Keep local laws in mind.

Another thing to keep in mind is state laws and rental regulations. California laws tend to be fairly anti-landlord. In my experience, a recalcitrant tenant who doesn’t pay and also refuses to vacate can turn into a very big headache for a long time. This is another reason it doesn’t make sense to invest in real estate in San Francisco. In this regard, the Sun Belt states are a lot more investment friendly.
In this short video I explain how one of our investors recently closed a very favorable property deal. You too can learn how to make savvy real estate investments to secure your financial future! Check out upcoming events to learn more about creating retirement riches for you and your family.

My Top Criteria for Property Investments & Why They Should Be Yours Too

One of the questions that often come up in the investment expos I address is that of where to buy property in a way that offers the best ROI (return on investment). Is Austin a good place to invest in, they ask me. Elon Musk was spotted there, so it must be cool or hip, they tell me. They are very wrong. Let me explain.

Austin is a sellers’ market right now.

In the past, I have invested in Austin and helped people do the same. In fact Austin was one of my favorite markets and investing there was a good option then. Past tense! Right now, the Austin real estate market is among the craziest in the country. Property owners here should be looking to sell or to hold – not buy. There may be a lot of buzz, and thanks to the pandemic, there is even more turmoil in the market, but Austin is not where you want to buy real estate right now.

Your purchase criteria.

There are a few things you need to keep in mind when you’re investing in real estate. You have to choose the type of property you buy. For instance – a single family home or a condo? What makes more sense in this scenario of the COVID pandemic when people are scared of shared spaces? There you have your answer.
You also have to choose carefully when to make the investment. Austin is not good right now, but there are areas that have loads of growth potential. So where and when you buy also matters greatly. Another aspect you want to look at carefully is rental incomes. A buyer’s market doesn’t necessarily mean that rental incomes are good in the area.
All this market insight isn’t simple or straightforward. Luckily for you, our quarterly real estate investment expos can help. These events are designed to guide you to make purchases based on several criteria such as type of property, location, future appreciation, current rental prices and so on. Check out this short video (under 3 minutes) where I explain how this works.
 You can also check out upcoming events that may interest you.

How to Identify the Right Time to Invest In Real Estate

When is too early to start investing in my future? Am I really ready to start investing in real estate? Do I have the time and the experience to do it? What if I make a mistake? 
These are some of the questions I am asked all the time by potential clients. There are some who are hesitant about taking the plunge, so to speak, while others have a spouse or a family member who is averse to the idea. So how do you get around that? When should you start investing and how to know if you are truly ready for it? Find out here.

Investing doesn’t need you to be an expert.

Much of the hesitancy comes from diffidence and a simple lack of experience. People believe that one has to be really clued into the real estate scene to make informed choices and decisions. They also – erroneously – believe that as a homeowner they have to be hands on and that this will take up a lot of time. Fortunately, these are all misconceptions. You don’t need to be an expert and nor do you need to invest a lot of time and effort into your real estate investment. Check out this short video where I crunch a few numbers and explain the Fannie Mae rules among other things.
At ICG we offer expert guidance for you – whether you want to buy one or one hundred homes. We put you in touch with developers, reliable property managers and guide you through the loan process. At no extra cost to you, you have access to our carefully cultivated network of professionals who will save you time and help to safeguard your investment. So really, when you think about it, investing in real estate is not at all the daunting proposition that many think of it as.

You are never too young to start investing in your future.

For those who think they are too young to start investing for their retirement, let me disabuse them of the notion. The fact is, one is never too young to start investing in one’s future and financial security. It is also never too late! I have had people in their 20s and 30s approach me for real estate investments, and I have also had people start investing in their 60s and 70s!
Still have doubts? Are you wondering if you are financially ready to make the commitment? Or perhaps you are sure and a spouse or other family member is the one that needs some convincing? Well this is also something that I frequently help people out with. Check out this short episode where I answer some of the questions I am frequently asked. I explain how to take the next step towards your future financial security, and how you can ensure that you make the best choices for yourself and your family. 

ICG – Helping You Get the Best Out Of Your Real Estate Investments

Peter believes that when he started investing in real estate at age 65, ICG helped save him from a life of poverty. Derek is so satisfied with his financial future that he makes it a point to gift my book to people he meets. Niva Lev has the peace of mind that when she is no longer able to work as a physiotherapist, the properties ICG helped her invest in will take care of her. These are just a few of the stories of the ICG Advantage – which comes at no extra cost. I explain more here.

The history of ICG.

It all began when I was a young engineer in Silicon Valley back in the early 80s. I would look at my clever, hard working colleagues – with not a lot to show for their hard work and talent in terms of finances. I decided I wanted more! That was the time when I invested in homes in the Las Vegas area. To begin with, those colleagues laughed at me. But soon they joined me, and before long I was heading a consortium of investors buying homes in the region.
This is when I realized the power of the concept. It isn’t just the fact that real estate is probably the one genuinely recession-proof investment there is. It is also the fact that there is power in numbers. And that is why ICG has the power to really help change lives.

Get the ICG Advantage for you.

You may buy just one home – or you may decide to buy dozens. However, you can still avail the ICG advantage. It is simple – you have access to the same developers, property managers and financial resources that I use when I invest in real estate. When you come through ICG, you have the clout that comes from belonging to a large group. We at ICG are people with industry experience so the developers and managers are happy to sweeten the deal for you. They are eager to please me, and by extension, they want to please you!
Know more about the ICG advantage and about securing your retirement riches today (no matter how young you think you are, it is never too early to start planning for your future). Find out how you can secure your future at zero extra cost to yourself. And since there are professionals in charge of everything, you don’t have to take time out of your busy life either. Check out this short video to start planning for your financial future and creating a passive income for you today!
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