LEARN HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE
Learn how to make passive income from real estate. Make your money work for you instead of vice versa with this effective strategy to create streams of residual income in real estate.
Today I’ll answer your question about how to make passive income from real estate, and I’ll reveal a little-known strategy.
I’m Ted Thomas, and I’ve been involved in tax liens and tax deeds for the past 30 years. One surprise is that just because you start later doesn’t mean that you’re headed for a not-so-hot future. No matter when you start, with a little guidance and a plan, you can end up wealthy.
I’m going to share this information with you, and when we finish, you’ll have knowledge that will help you make money with small deals.
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HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – THE HYPE
Have you ever wondered how you can start small and become wealthy? Maybe you’re not so young. Maybe you haven’t made any real estate investments and are a little afraid to get started, yet you see everyone bragging on the internet about getting rich.
It seems that everyone wants to make money in real estate. It also seems that every promoter or salesperson has a different way to make money and that their reason is the best. It’s difficult to get past all the hype and promotion. There are so many ways all claiming to be easy and lucrative.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – THE REALITY
How do you build a passive income stream? Let’s get real and use an actual example so that you can see real people making real money and doing it in a simple way.
What matters is where you end up, and I’m going to show you how to make nice profits in not-so-hot markets with very little money.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – AN EXAMPLE
My student client from Michigan had very little money. Now here was a guy who was not too glamorous, hadn’t made any investments for decades, and really wasn’t that sophisticated.
Tax liens and tax deeds have been a hidden business for decades. My client shortly after learning about tax lien certificates and tax defaulted property learned that the county records reveal tax auctions every year.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – TAX DEFAULTED PROPERTY
It turns out Michigan has 83 unique county jurisdictions. Each of the 83 counties need money to run the government. However, each of the counties also has dozens and, in some cases, hundreds of property owners who have not paid property tax.
Normally, the money from property tax arrives automatically at the county treasurer’s bank account. Most property owners are honorable and responsible and pay taxes on time. Unfortunately, there is a whole group of other property owners who are not so diligent.
So, Mr. X discovers tax-defaulted property, and yes, life is challenging for others because they may have lost a job or been injured. The bottom line, they haven’t paid their property taxes.
In Michigan, and in all other states, the legislature makes the rules. The rule we are discussing today is all property owners are required and must pay property tax, or the property owner will lose the property to the taxing jurisdiction.
This happens to all sizes and values of property. It happens in the county club, on commercial property, and low-priced residential.
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HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – TAX DEFAULTED AUCTION
Now let’s talk about how to make passive income from real estate. Mr. X. is soon attending a Michigan auction. It’s a whole new world.
Many auctions have a few properties, others have dozens, and still others, in the large population counties, have hundreds of properties which the county government auctions off for pennies on the dollar, and there is no mortgage on the property.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – MORTGAGE-FREE PROPERTY
The starting bid is very low, usually very close to the delinquent back taxes. The treasurer or county employee will start the bids at the back taxes which could be as low as 10 or 20 cents on the dollar.
The state legislature has authorized the county treasurer to clear the mortgage from the official county records. The auction will sell free and clear properties.
Imagine buying for pennies on the dollar, getting a bargain property with no mortgage. Sounds too good to be true, doesn’t it?
This is a step-by-step process. If you’ll learn to follow guidelines, you can soon be on the winning side and on the road to financial success.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – BARGAIN REAL ESTATE
One man’s garbage can be another man’s gold. Mr. X purchased a tax-defaulted property for $6,000 in a not-so-hot residential neighborhood. The building was used and abused. However, the tax-assessed value according to the appraiser was $50,000.
Mr. X purchased the property for just pennies on the dollar. The purchase from the county transferred the deed to Mr. X, so Mr. X can move into the property, or he can sell it. His biggest need is to produce residual income.
If he wanted cash flow, Mr. X could sell the property at less than the tax assessed value for $30,000 very quickly. After the purchaser received a loan, Mr. X would have the money in his account. Since he only paid $6,000, he’d make a huge profit.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – INSTALLMENT SALE
Mr. X wants passive income from real estate, so he decides to follow a common lesson of selling and use an installment sale.
Why does he use an installment sale? Because now the property will produce residual income. Plus, there are many more buyers for installment sales than there are for full purchase price sales.
Mr. X is going to sell with a small down payment and then use a contract for deed to sell the property, requiring the new buyer to pay $350 a month for 10 years. That’s 120 months.
120 months multiplied by $350 turns out to be $42,000. To the $42,000 add back in the $6,000 down payment.
HOW TO MAKE PASSIVE INCOME FROM REAL ESTATE – SUMMARY
Passive income from real estate is the key to the future. At a tax-defaulted property auction, Mr. X bought an ugly house slightly used and abused for only pennies on the dollar.
The tax assessed value was $50,000, and Mr. X purchased it for $6,000. He sold for considerably less to get a quick sale using an installment plan.
By accepting a $6,000 down payment, he received a 100% return of capital. The profit will be collected over 120 months at $350 a month.
In total, Mr. X will receive $42,000 in payments in addition to the $6,000 down payment, and he will have residual income for the next 10 years.
The opportunity is huge. There are hundreds of properties available.
The brilliance of this method is if a person started late and used this step-by-step process, there is an opportunity over a few years to own two, four, maybe ten of these properties and have massive residual income.
If you’d like to know more about how to make passive income from real estate, there’s no one more qualified to teach you than Ted Thomas, America’s leading authority on tax lien certificates and tax-defaulted property investing.
Ted Thomas is the only one who provides full support and complete training with home study courses, Q&A webinars, live tutorials, workshops & web classes, and personal coaching.
Get started today at no cost with Ted’s FREE Master Class, which reveals the incredible opportunities available to you in tax defaulted real estate. This class is only about 1 hour of streaming video and contains life-changing information! You won’t want to miss it!