How To Evaluate Whether It's A Deal Or N...

deal Most of you are familiar with the TV game show, Deal or No Deal. The crux of the show is built on guesses and chances. The contestant is presented with sealed briefcases full of varying amounts of money. It could be one penny; it could be $1 million.

The contestant has no tips or hints, but has to choose which briefcase to unseal. Whatever is in that particular briefcase, they get to keep. It’s all a gamble.

Hey Moguls, Matt Andrews back again, and I have a question for you...

Do you want to run your business like a game show, basing all your decisions on wild guesses?

Or do you want to use well-crafted insight and workable strategies?

If your answer is the latter – then good – let’s get to work…

In this lesson, I’ll be showing you exactly how to quickly assess a lead and how to know whether or not it’s a deal for you and for your business model.

So, how do you evaluate a deal? Here are 4 steps for you to consider.

Step 1: Determine Your Exit Strategy

It may seem strange to have the word exit in Step 1, but the fact is, you must know your exit before you make your entrance.

Before you buy a property… before you invest in a property… before you recommend it to another investor… before you take on another rental property – you need to know exactly what your exit strategy is.

You want to know how you can make money from that deal.

Step 2: Run the Numbers

To get an idea of what you have in a particular lead, you must run the numbers.

You must consider these crucial questions:

Will this be a good property for a rental?
Should I buy, hold, rent, flip?
Can it produce good cash flow for me or for other investors?
Is this a property that I can lock up on contract and quickly wholesale it to another investor?
Is that the best exit strategy? Maybe make $5k, $10k, or $20k — is that the way to do it?
Should I buy the property, fix it up, do a full rehab, then sell it to a retail buyer and make a bigger spread?

So, you need to figure out your exit strategy and know what this property is good for based on the numbers.

And make sure you consider that maybe you find out it’s good for none of those options.

Know this: “What gets measured, gets results.”

Step 3: Deal or No Deal

Once you have your exit strategy and you’ve run the numbers, now it’s time to decide…

cent Is this a deal or no deal?

If the exit strategy was to rent it out, and you wanted at least a double-digit cap rate as a rental, and you find out this thing is only going to make 4% or 5% as a rental…

No deal.

If it’s a property that you plan to rehab and sell to an owner-occupant buyer, and you’re buying it for $100k knowing you can sell it for $150k… but it’s going to take you $60k-$70k to fix it up — then you’re $20k under water...

No deal.

This is why it’s important to first line up your exit strategy, then run the numbers.

Only then will you know if it’s a deal — or no deal.

Step 4: Take Action

If you do the first three steps correctly, you’ll have the confidence to step out, take action and make money on deals.

This is the way you can flip properties and gain freedom through real estate investing.

Remember my saying:

"Money is NOT the most important thing in life. That's why I have worked to develop passive income to a level that I can now focus on the truly important things!"

Have You Ever Taken the Game Show Route?

Did you ever get so taken up with wanting a deal to be a deal, that you threw caution to the wind and just took a chance? What happened? We want to hear from you. Your experience could be exactly what another investor might need. Leave your comments below.