Underwriting at auctions explainedMake Text Bigger
I’m sure if you’re like me you’ve seen constant adverts on Facebook from the newest guru. Promotions “how to buy property with none of your own cash”, or how to make ‘£2k per month without buying a property’ etc.
99% of the time you click through and it’s a video inviting you along to a webinar or a training day. The headline draws you in, but there is no content. Eventually there will be a sign up form to capture your data, then some form of sale.
There is absolutely nothing wrong with paying for training and content and there are some companies and people who do it well and have the experience and results to really deliver true content which will help people, but for every one worthwhile there are 99 which are not.
On Facebook there has been a surge of selling with no substance. One minute the individual is posting pics of their first day on a mentorship program and six months later they are selling courses “how to”?! When you scratch the surface there will be little behind it.
So this is the part where I say my training course which was £5,000 is now only £99 and is completely different and better 🙂 Joking!
For years I’ve watched people and strategies come and go. I’ve always toyed with the balance of enjoying sharing what we do, what I’ve done vs time, responsibility and monetising. Responsibility is something that gets lost in all this! I get the fact that if someone gets the content and doesn’t act on it, how is that the responsibility of the trainer? I guess it’s down to money and how much has the pupil paid.
I’ll give you an example – If I send my child to a private school and after the first year the teacher says to me: well I’ve shown Grace how to read, but she didn’t do what I told her, so it’s up to her and not my fault if she succeeded. I’d be pretty annoyed.
What I’ve always struggled with is, if I was to mentor anyone, and they paid good money for me to do so how could I ensure they succeed. How can I be sure that if they do what I’ve done the will achieve what they want? We even tried a training model back in 2015, but what was clear is people who want training/mentorships come in all shapes, sizes, personalities, positions and backgrounds.
I have to be honest, sometimes I don’t like a certain person so how could I mentor someone I didn’t like?
Having the NPN (Norfolk Property Network) helps, because I can talk to crowd for 1/2 hours every 2 months. I’m always happy to talk at peoples’ events, but because I don’t venture too far outside the Norwich bypass getting out of Norfolk is quite tricky.
Therefore, I’ve decided to start posting videos via YouTube giving the content behind the promise. Don’t get me wrong I deliberately post a head line tag, this is to show people that headlines can have content straight away. The content isn’t sexy, slick or stylish, but it’s ‘how you can achieve the headliner’ and in the video I hope people will learn something.
So some of you may have seen my first video, head line “How I made £10k at auction without buying a property”
Cheesy, but my video breaks this down. I did actually attend a property auction, which I’d pre-agreed to underwrite a property.
The bid went for £20k+ over the amount I had Underwritten the property for, which I received 50% of. Therefore, I made £10k+ at auction without buying a property.
So What is underwriting? There is a link to the YouTube video below which gives you the full explanation. If a property is underwritten, you (the buyer/underwriter) agree to pay a minimum amount for a property regardless what the bid it makes on the day of the auction. This gives a seller a guaranteed sale.
Here’s where it gets interesting. If the bid goes higher than the amount you’ve underwritten, the proceeds are shared 50/50.
Example: Property guide is £80k -£100k, Sellers reserve is £90k, You underwrite at £100k
- Scenario 1: The bid gets to £110k and sells to another buyer. You (the underwriter) take £5k and the seller takes £105k
- Scenario 2: The bid gets to £110k and you buy the property. You the underwriter pay £105k and the seller takes £105k
- Scenario 3: The bid gets to £95k. You the underwriter pay £100k and the seller takes £100k
It has its own risks, and as I explain in the video you should only ever underwrite a property you want to buy. The detail given on the video, hopefully will mean more will start to share actual content straight away. Sharing the content for me delivers what I want (which is to share) in the way I want (without the hard sell or travelling the country)
I hope you enjoy.
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