Some Banks Give Back TARP Funds

Real Estate News & Commentary by Chris McLaughlin, March 11, 2009
http://www.shortsalesriches.com/welcome.html

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The government gives…and now the banks say no thanks. With all the scrutiny (much deserved, in my opinion) these banks have received lately, a few of the well capitalized banks that were asked to participate in the TARP program are now saying that they’d like to return the money and get out of the program. They are tired of the media spotlight, and even though the money came cheap, they don’t want Uncle Sam running their internal operations. So who’s nice enough to send us back the money?

Signature Bank of New York announced that it would return the $120 million it received from the government just three months ago. It indicated that the new restrictions on executive compensation weren’t palatable to them, so they’re ready to return the money. And the rumor mill for who else will return the money continues, but The New York Times reported today that TCF Financial Corporation, Iberia Bank of Lafayette, LA, Goldman Sachs and Wells Fargo are among those who may just give it all back.

So why did they take it in the first place? Actually the big boys like Goldman and Wells were asked to do so. Former Treasury Secretary Hank Paulson asked that all major financial institutions participate so that they wouldn’t be singled out for taking it and therefore a run on the bank would ensue.

The financial markets traded sideways most of today. As of 2:30 PM ET, the Dow Jones Industrial Average was down 38.47 to 6,888.02 and the Nasdaq was up 2.25 to 1,360.53.

Now on to our real estate investing education section …

“You can’t know it all. No matter how smart you are, no matter how comprehensive your education, no matter how wide ranging your experience, there is simply no way to acquire all the wisdom you need to make your business thrive.” Donald Trump

Whether you like Donald Trump or make a mad dash for the remote at the first sign of bad hair, one thing is certain…he thinks big and has been around the block a few times when it comes to real estate. Short sale investors should take note of the above words of wisdom from one of America’s larger than life billionaire real estate investors; trying to do everything your self is a recipe for failure when it comes real estate. Savvy short sale investors understand when to seek outside help and how to avoid the burn-out, excessive cost and time traps that often turn a would-be profitable enterprise into a money pit. The following represent the most common jobs best left to others:

Education. Like Trump said, there simply isn’t any way to acquire all the wisdom you need to make your business thrive; it would require all of your time and effort while leaving you little time to do anything else – like actually invest in short sales! Instead, team up with others that have the skills, knowledge and networks you need. Invest in the best information and education you can afford when first getting started then hit the ground running – your first deal will more than make up for the difference.
Sales & Services. Put a team of hardworking sales and service experts in your courtyard then deduct the cost from taxes. Very few people are able to break even when doing sales and service related work on their own; not only do they take longer and typically yield less impressive results since they are not experts in the area but the IRS excludes deducting for one’s own time unless you are a full-time professional in the area. When you calculate the total cost of hiring others to do the job for you, 9 times out of 10 you will come out ahead by taking the tax deduction and moving on to bigger and better things.
Renovations. While sweat equity may be the only way for some people to get into the game, renovations can be costly, time consuming and expensive to tackle on your very own. Calculate the cost of doing all the work on your own then get creative about hiring help; bartering, hiring day labor or independent contractors can drastically reduce the time required to get the job done at a fraction of the cost. Don’t forget, you can have a company perform all the screening, background, payroll and taxes on your behalf – another major time saver!

See you at the top!

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html

P.S.

The Recession Proof Real Estate Investing webinar is this Thursday at 8:30 PM ET, 5:30 PM PST. Don’t miss out … click here:

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About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties

    * Owner and Supervising Broker of one of Florida’s
     largest Real Estate firms, running 4 different
     offices, supporting nearly 450 agents, uniquely
     positioning him to help thousands of investors
     make money in the biggest market opportunity ever!

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building

* On twitter: http://twitter.com/mclaughlinchris
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