Transcripts:

Steven Butala:

Steve and Jill here.

Jill DeWit:

Hi.

Steven Butala:

Hey, welcome to the Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.

Jill DeWit:

And I'm Jill Dewitt, broadcasting from sunny Southern California.

Steven Butala:

Today. Jill and I talk about where to start when starting a business and without fear.

Jill DeWit:

What is this?

Steven Butala:

So it's not just about starting a land business. It's just basically starting a business. I think this confuses a lot of people. For other people, it's just very natural. It's a logical extension to having a W2 job. But this is really just about that initial twinge like, "I really want to start a business and I don't want to do it with fear. I want to know that it's going to work within reason and I just need a first few steps to check it out."

Jill DeWit:

Perfect.

Steven Butala:

Before we get into it, let's take a question posted by one of our members on the landinvestors.com online community. It's free.

Jill DeWit:

Buck wrote, "I have a buyer who wants to immediately move his RV onto a property where I'm providing owner financing. The county requires that septic be installed and that he have a temporary use permit for the RV to be legal. The buyer says he'll get the permits. What would you do?"

Steven Butala:

Run the other way.

Jill DeWit:

Wait, wait, wait, wait. Hold on a second.

Steven Butala:

I would never allow this.

Jill DeWit:

Why not?

Steven Butala:

There's too much legal issues.

Jill DeWit:

No, no, no. Oh, owner financing. Sorry.

Steven Butala:

Yeah.

Jill DeWit:

That was my thought. I'm like, "Wait, wait, wait, wait a minute. Where are you going with that?" I had to take a step back and realize it's owner financing, because most of what I do is cash.

Steven Butala:

You bought a $10,000 property. You posted it for sale on Craigslist for $2,000 down and $150 a month for 15 years. And you calculated on your little calculator that you're going to make about $22,000 on this deal when it's all paid off. And so you're jumping up and down around the kitchen. Well, the fact is that a very material percentage, more than 50% of these properties, when they get sold, you get the down payment, they make five payments, then they go dark and you just never hear from them again. And so there's something wrong. This person has a lot of money to do all this RV stuff and these improvements, but they don't want to buy the property outright. There's some issue there.

Jill DeWit:

So that's what you'd do. Number one, you say, "Look, owner financing, I'm not comfortable with this. Can't do it. You want to buy it cash from me, now it's yours and everything's on you. Knock yourself out." That's the first solution, is right there. And I would even say, "Look, here's the deal." Most people do that. When the people that I've seen, they have a cash price and they have a seller or an owner financed price, and it'll be obvious, you cash out, it's definitely cheaper. So if you don't even have that, offer them a great cash price. "Look, I'll give you a 20% discount if you want to just buy the property and then it's yours and then I won't have a say in it. You can do whatever you want."

Steven Butala:

Jill's an expert at this. I've heard her on the phone. If you've got to list a property for, here's my example, you bought it for 10, just say you sell it for $15,000 or $18,000 cash, and if the property is worth 50, he'd be shocked at how fast whoever they are can come up with their money from their relatives or whatever else just to get them into the property, all of it.

Jill DeWit:

Right, they really want it.

Steven Butala:

As an owner with no liens.

Jill DeWit:

But I agree with Steven. I mean, the bad news is it's just too much that I could be liable for and I don't want to do that. I don't want the county calling me saying, "This guy's out there. He needs to move it." And it's mine, so I'm responsible to get somebody out there to ge...