Author Archives: Dave

3 Real Estate Investing Calculations You Must Know

by Dave Peniuk

As part of our 31 Real Estate Investing Videos series I put together this short little video on 3 real estate investing calculations you gotta know!! These are calculations I see plenty of realtors, real estate investors and media reporters getting wrong…  and yet, they are critical to know and understand.

In case you haven’t signed up for our series (WHY HAVEN’T YOU?!! – It’s 31 FREE videos jam packed with some of our best tips & resources!) … or you missed this video …  here it is:

What are some of the real e state investing calculations YOU use? Let us know in the comments below!


Filed under Real Estate Investing Video Tips

Tony Peters and Creative Real Estate Tips

by Dave Peniuk

Julie and I recently had the opportunity to attend Tony and Jo-Ann Peters: Creative Real Estate Investing Power Workshop….yes, that’s a mouthful, but for good reason!  It was jam-packed with great strategies, advice, tips, resources, and a ton of great real examples! In this post, I am going to discuss just 2 of the many strategies one can use on the creative side of real estate investing.

2 of my favourite creative real estate tips: Long Closings and Free Stuff

Long Closings:

While I had heard of both of these creative strategies from other real estate teachers/educators before, I really liked how Tony and Jo-Ann emphasized the win-win approach to using these strategies. Long Closings, for example, is based on the premise that you tie up a property that’s for sale but the Seller’s, for whatever reason, do not (or cannot) close and move out of the property for 6, 7, 8+ months.

Image Credit: Jason Floyd

My personal favourite and one that we have encountered quite a few times already through calls we have received from our yellow letter campaign, is where the Seller is currently building a new house but residing in the house they want to sell. Rather than sell it and move into a rental for 6-12 months, you suggest they reside in their home until they are ready to move into the new one they are building.

So, why do this as a Buyer? First, it gives you time to find either a Tenant (as a rental) or Tenant-Buyer (on a lease to own), flip it to another investor or even sell it to a new Buyer. It also gives you time to line up joint venture partners and financing if that is the route you are going to.  And, the BIG bonus of a long closing is IF it’s in a warm (or even better – a HOT) market, the property may appreciate 5-10% or more during that time! Guess who gets the equity? You do! But, this generally works best in an appreciating market. If the market is flat or even worse, falling, then you could be stuck with a property that is now worth less than what you agreed to pay 9 months ago! So, make sure you do this ONLY in a market that is seeing appreciation!

Free Stuff!

Who doesn’t love free stuff? I tell you, if I could make a nickel every time I gave away free stuff (yes, then it wouldn’t be free would it? but you get the point!), I would be as rich as Donald Trump!

Basically this strategy is simply asking for something that you may want that is at the Seller’s house/property. For instance, perhaps the Sellers has a nice collector car, RV, motorcycle, or even lawn mower at their house. Why not ask for it as part of the purchase? If you can find out why the individual is selling (and where they are moving to – maybe they are downsizing into a condo?), then they likely may not need or want a lawn mower or even their nice collector car.

Sometimes there is even nice furniture that a Builder may have paid for to stage their showhome! Ask for it! We just did that very thing recently when negotiating with a Builder who needs to sell. We asked for the furniture and the Sales Agent said it likely will go. Remember, you won’t get if you don’t ask!

WHY would a Seller agree to a Long Closing or give you Free Stuff?

Again, it could be for any number of reasons. If they are building a house and the bank will only finance the construction if they sell (or have a firm Purchase and Sale Agreement in place) their current house – BINGO – this is an opportunity for the Seller to know their house will sell, the bank will finance the construction of their new house, AND they can continue to live in their current home (that they’re selling) without disrupting the family to move into a rental and then move again once the new house is built! See, win-win!

And including Free Stuff in the sale of their home can be a great win for the Seller too. For instance, as I mentioned if the Sellers are downsizing and don’t want to deal with doing a garage sale or fool around with placing ads to sell their car, motorcycle, shed, lawn mower, etc., then this is an easy alternative for them. There can, again, be any number of reasons why someone would give away Free Stuff, but they likely won’t UNLESS YOU ASK!!

So, a couple of great strategies that we “re-learned” while attending Tony and Jo-Ann Peters: Creative Real Estate Investing Power Workshop.

Remember, real estate investing can be fun and creative…not just buy, rent, sell, buy, rent, sell. If you have any other creative/interesting tips or strategies, please comment!

If you want to learn more about what Tony and Jo-Ann are teaching … check out the call we had with Tony Peters a few months ago. And if you’re interested in attending one of their upcoming workshops, give Brenda a call at their office at (780) 414-5282. Let her know that Dave from Rev N You sent you and she will probably let you bring a guest at no charge!!

Image Credit: © Dexns |


Filed under real estate, Tony Peters

How to Find a Great Realtor as a Real Estate Investor

by Dave Peniuk

Not all realtors are created equally. In fact, most realtors just aren’t that good when it comes to working with real estate investors. As real estate investors we need a realtor who will:

  • Take the time to understand our parameters and WHY we have those parameters. Just because a property has a basement suite doesn’t make it an investment property.
  • Respond quickly – when we’re working on a deal we are usually moving quickly and when we need information or want to see a place we would like a call back/email returned within 24 hours. And in most cases I would prefer a realtor respond within a few hours.
  • Be willing to try different things when it comes to making offers. We rarely make a standard offer. We almost always ask for special terms like vendor financing and we ALWAYS ask for the ability to access the property several times before closing to show to tenants.
  • Be comfortable with the foreclosure process, making aggressive offers and sniffing out the real story behind the sale of a property.

So – how do you know what to look for in a good realtor and where can you find one that will work well with a real estate investor?? I created a couple of short videos as part of our 31 Real Estate Investing Video Tips. You can check those videos out right here:

And I’d love to hear from you … what makes a good realtor for you? Do you have an awesome realtor? How did you find him or her??

And if you want more awesome videos like this be sure to sign up for our Real Estate Investing Video Series. Julie and I created 31 short videos full of tips to help you be a more successful real estate investor. The videos are all 3 minutes or less and they are free!! It’s our gift to you!!! 🙂 Enjoy!!


Filed under investing, real estate, Realtors

The Fallacy of the RRSP Investment

by Dave Peniuk

I am going to get to the point today, which is often very tough for me (according to my lovely wife and business partner, Julie!). You see, I just returned from a conference on how we can utilize the cash in our Registered Retirement Savings Plan (similar to an IRA in the USA) and become fat and rich like our Banks, and lend that cash out as mortgages. But besides learning about the process of how to do it and following all of the government rules and regulations, it was pointed out just how few Canadians actually understand what their RRSP is.

I call it the “Fallacy of the RRSP Investment“. You see, a fallacy is “an incorrect or misleading notion or opinion based on inaccurate facts or invalid reasoning“.

Your RRSP in and of itself is NOT an investment.

It is a special type of account that can hold funds in it and the funds in it are tax deferred (thus, you can write-off your contributions to it and the returns are not taxable either – UNTIL you begin withdrawing the funds).

But, and this is very important, the RRSP is not an investment. The GIC’s, Mutual Funds, Stocks, Bonds, Mortgages (yes, you can invest in a mortgage through you RRSP account) are the investment.

I want to inform Canadians (and even our US counterparts with their IRA accounts) that they need to educate themselves and take more control of their money. If you do not know, unequivocally, what investments you have within your RRSP (or RESP, LIRA, RRIF, etc.), and what is their NET RETURN to you, then you need to take a good hard look.

This is what Dave looks like when he's excited

And you know what I am excited about? Really excited about? I am excited about the fact that I now have the full knowledge of how to use the cash in my RRSP’s and how I can help others use the cash in their RRSP’s to invest in mortgages (and with it the knowledge of what the NET RETURN will be because it’s a mortgage!! – you know, like the ones that you pay the banks hundreds of thousands of dollars in interest??!?!).

Now, I am not giving advice, as I am not a “Licensed Investment Salesperson” at one of the financial institutions (many Financial Advisors were called this until 2008), but I am letting you know you have other options available to you in your RRSP accounts. And, I urge you to find out:

  • What are you invested in within your RRSP (RESP, RRIF, LIRA)
  • What are your NET returns (this is your total return less all the fees charged by your Advisor, or Mutual Fund, or admin fees..)
  • If you have a Financial Advisor, Planner, Broker, ask him or her to explain how your investments are doing in REAL CANADIAN LANGUAGE
  • Ask your Planner what they are invested in and see if they are invested in any of the same products they suggested you invest in

If you do the above, and are able to get a real handle on the investments within your RRSP (or IRA), then you will be well on your way to taking real control of your money….because hey, no one and I mean NO ONE will (or more importantly SHOULD) care  more about your money than you!


Filed under real estate, RRSP

No Money Down Real Estate Investing Canadian Style

by Dave Peniuk

You might remember in the fall, when I was away on a commercial halibut fishing trip with my Dad, Julie signed me and her Dad up to go to Ron LeGrand’s Quick Turn real estate investing program.

We had just closed on 2 new properties and it had been a giant pain in the butt to get financing for those deals. She thought it was time we shook it up a bit and learned some new techniques. Plus, the more we know the easier it is to help our Rev N You with Real Estate Newsletter readers!!

The program led to us send out 5,500 direct mail letters, and in general, we hammered the city of Nanaimo with our marketing message.

It also led to the police calling us and the local newspaper running a story on our unconventional deal finding methods. It’s been interesting and we’ve had fun with it for sure.

But after 3 months of intense effort we haven’t secured a single deal. We’ve come close, and by the end of February I think we’ll have at least two deals firm, but as of right now we haven’t locked one in yet.

All this led me to contact an Edmonton based guy named Tony Peters.

Tony has become somewhat famous within the Real Estate Investment Network (REIN) club I belong to. He has purchased hundreds of homes using creative strategies that require little money down and in many cases NO BANK FINANCING!!! WOOHOOO!!

The folks I know that have taken Tony’s programs or heard him speak have given him glowing reviews … they’ve learned a lot and are starting to make things happen so I wanted to learn from him and I thought you would benefit to.

I am so pleased to be able to invite you to join us on a call with Tony on Tuesday, February 16th at 6pm PST.

AND the best part … there is no charge!

AND the second best part … when you register you’re going to get a free one hour audio interview between Tony & the Vice President of REIN, Russell Westcott where you’re going to learn some of Tony’s creative strategies, hear his story and start learning so when you come to the call on Tuesday you can ask any questions that you have!

Bring your questions Tuesday night – you can speak with Tony too!

Oh, and if you can’t make the call we’ll send the replay out to everyone that registers.

By the way … thank you to EVERYONE for all your comments on the What’s Missing From This Kitchen game!! We had a ton of fun and really appreciated your participation. Check the comments to see if you’re one of the 3 T-Shirt winners that we selected!!


Filed under investing, real estate, Tony Peters

What the Numbers on a Real Estate Deal Won’t Show

We don’t mean to pick on get rich quick real estate investing courses … but some of the things they teach are total garbage. In the program I took years ago the instructor placed a heavy emphasis on the numbers … GRM, Cash on Cash Return, and other numbers were all they talked about. It was all about the cash in and the cash out.

The return and your cashflow are definitely important concerns as a real estate investor however focusing on JUST the numbers can cause you to miss some other important things you should watch for when looking for great investment properties. In this short video, I explain further:

If you like this video … you can get 30 other short real estate investing video tips. We’re giving them all away for free!!

Get all 31 real estate investing videos right now.


Filed under Real Estate Investing Video Tips

The Nuts N Bolts of Holding VTBs

by Dave Peniuk

If someone were to ask me what the toughest part of 2009 was I wouldn’t hesitate in saying it was finding financing for our real estate investments. We’ve spent a lot of time lately talking about private money as one of the solutions to the credit crunch, but it’s been awhile since we mentioned our preferred source of funds in many cases and that is a nice VTB! And for a change of pace I thought I would write about it from the perspective of a seller … because there are many advantages to offering a VTB to a buyer of your property and as a real estate investor you should not only understand why you should almost always want to ask if the vendor will finance a portion of your property, but why you may want to offer a VTB on a property you’re selling!

What is a VTB some of you may be asking? In a “nut”shell (yes, quite clever I know 🙂 ), a VTB is a Vendor Take Back mortgage or loan. It is simply where the seller (Vendor) of a property is willing to provide some or all of the mortgage financing on that property.

When times are good (economy is improving, employment is rising as are incomes, all is well), you often see fewer VTBs. This is because the access to credit (getting loans/mortgages/lines of credit) is often “easier” and houses are selling at a steady to fast pace. Vendors are not as willing to carry financing because it is not as difficult to sell their house. BUT, and this is a BIG BUTT, when the economy is slowing, access to credit is more difficult, and properties are not selling as quickly, Vendors may be willing to get more creative in order to unload that property.

But – for you – a potential VTB holder,  it’s important to understand there are plenty of other advantages to holding a VTB that make it attractive even in a hot housing market.

You will often see investors more likely to hold VTB’s than a regular homeowner just trying to sell their house. This is because investors “get it”. They will likely know what a VTB is and know the advantages, both for themselves and for the buyer. In tough times, a VTB might make it easier to unload a property. But at any time, a VTB can allow a seller to make some additional money on the house by charging interest on the loan, as well as potentially defer some taxes.

Why earn 2% in a “high interest savings account” at your bank when you can earn 7% or more on your VTB?

But, there is risk involved with carrying “paper”. Let’s get the wrench out (remember we’re dealing with nuts and bolts!) and have a look!

VTBs are usually in 1st or 2nd position as a mortgage. If you, the VTB holder, are in first position you will get your money out first (assuming they don’t owe the government anything – because the government gets their taxes first!). You also are often able to get closer to your asking price when you offer a VTB. This is because the purchaser has fewer hoops to jump through, lower costs involved with purchasing (no appraiser is required, no lending fees to pay, less time involved seeking financing), and will often be willing to pay a higher price.

Second position has a few more risks. If you sell your property and your purchaser either assumes the current mortgage or brings in their own new lender but the purchaser wants to have higher leverage (increase the loan to value), they may want a VTB in 2nd position (behind the 1st mortgage lender).

Now, if you (the Vendor) are willing to hold that VTB in 2nd position, that means that you ONLY get your money back AFTER the 1st position Lender gets ALL of their money out first. This is only really an issue in the case of default, and foreclosure, but it certainly can happen! So, you need to think carefully whether you want to put yourself at risk.

So, why would you hold a 2nd position VTB?

  • You cannot sell your property any other way (i.e. the property is “ugly” and needs a lot of work, banks aren’t lending, purchaser can’t qualify for enough financing)
  • There is enough equity in the property even after holding a 2nd that you are somewhat “safe” and can earn a nice return
  • You know the property – because you used to own it – and feel comfortable making a loan secured to that asset
  • In second position you can charge a higher interest rate because there is more risk in the second position. So, instead of charging 7% in 1st position you can often ask for 8, 9, 10 or more percent interest. Of course it all depends on the other terms but you should be earning higher interest than the 1st position mortgage is charging
  • You would rather loan to a qualified Purchaser at a nice interest rate than put your money in a crappy low interest bond, GIC, or unpredictable stock/mutual fund
  • You want to delay Capital Gains taxes until the VTB is paid in full (you don’t pay Cap Gains taxes on any VTB loan amount until it is paid in full – but of course – I am not a tax accountant so be sure to consult your accountant for the nuts and bolts on that subject!).

So, you can see, there are many reasons why someone may hold a 2nd mortgage as a VTB.

And in some markets where people are struggling to sell it might be something to consider offering. As real estate investors we almost always ask for one, but we rarely think to offer one.

Julie and I have yet to carry financing on any of the properties we have sold. We always want our money out for a new investment opportunity, but we have asked (and received) several VTB’s when we have bought! Some were in 1st position (less risky to the Vendor), others were in 2nd (we couldn’t buy them without the 2nd in place), but to date none have been in 3rd position….but they do happen as well!  I do NOT recommend anyone hold a 3rd mortgage UNLESS there remains still some equity in the property (at least 10% available even after your 3rd mortgage) AND the Purchaser/Borrower is thoroughly screened AND, ideally, you hold the mortgage payment in an interest reserve account. (An interest reserve account is where the monthly interest payments for the year are put in a separate account so you get 1 year of interest payments set aside at the start. You don’t have access to it until the end of the year typically but it ensures it’s there for you).

So, the lowest risk place to be a Vendor holding the mortgage is always in 1st position.

The challenge with that is unless you own the property free and clear from any current debt you probably won’t have enough equity to offer the buyer a mortgage large enough to put you in 1st position. Which means you’ll often have to be happier with the riskier but more lucrative second position.

From a real estate investors perspective, we suggest you understand VTB’s even if you’re never going to offer one. You want to be able to explain the benefits to a prospective seller in the hopes that you can secure many of them. A mortgage from the Vendor usually won’t be anywhere near as difficult to qualify for as a traditional bank. AND, quite often the interest rate and terms can be quite good. The Vendor continues to earn money on their now-sold property, they delay their capital gains taxes on the portion that is held as a VTB (still have to pay income taxes on the interest earned through the VTB though), and they know and understand the security behind the mortgage (as they owned that home and the mortgage is secured against it).

In terms of structuring the VTB and getting everything organized for one – whether you’re holding it or getting one from a vendor, you must always always work with a real estate specializing lawyer who will put the documents together on your behalf. Please do not hire the cheapest notary in town to save $100. Get it done right. This will protect you and your ass…ets.  🙂


Filed under financing, real estate