Is Bill Mencarow’s Note Investing Right For You?
Hey, how’s it going?
I’m so glad you dropped in. I hope you take the time to browse around my site. I have a bunch of reviews besides this one that I think you will find helpful.
Today’s review is on Bill Mencarow.
Not Your Father’s Oldsmobile: From REI to Note Investing
This guy isn’t your traditional real estate investor. In fact, he may not even quite fit the profile of the people that I usually review for this site. This is a guy that used to do traditional real estate investing and then morphed into note investing.
I decided to review him because what he does is one side of the real estate investing coin and I thought this would be a great review to include here.
But I’m getting a little bit ahead of myself.
First, I just wanted to check in with you and ask what brings you to my site in the first place.
Are you here because you’re being squeezed by life and you’re looking for a new income-producing strategy? Sick of your 9-5 and looking to become the captain of your own ship?
Did you see an infomercial on TV by a guy in a white suit with a babe in a slick set of wheels who says he made it all happen through real estate investing? (And if you buy his $997 program or go to his $3,000 boot camp, you can have it all, too?)
If that’s why you’re here, I totally get it.
I was you a few years ago. I jumped headfirst into REI and played full out on the court. That is, until the market crashed and took
down all of my real estate dreams.
View from the Bottom
I lost my properties, went bankrupt and found myself pretty much sitting on my ass looking up and wondering what the hell happened. The thing was, I wasn’t alone. I had a wife and three kids and even parked in the bottom of that hole, I had to do something to support my family.
A guy named James spotted me at the bottom. He lowered a rope ladder, so to speak, by asking me if I had ever done anything with digital property management. So I jumped into internet based properties.
Took to it quick but quickly learned I suck at running a business.
Truth is, I didn’t have the mindset or skill to run a successful business. It wasn’t until I really got some serious coaching around why I do what I do that made all the difference.
Enter >KAT< and her coaching. She looked at me shaking her head and said,
Look, you gotta know why you’re even running your business. The truth was it was all about me :( It wasn’t about serving the client. I wanted to prove to myself that I had what it took to be successful.
The only problem is you can get there from here. You have to take a look at how you show up for people. We all think we have a winning mindset, that we know what it really takes to succeed.
After all, what could be so different about other people that do well? Right…
I don’t want to diss real estate investing as a viable income producing activity. But I would recommend you check out this video before you continue down the journey.
From the Hill to Real Estate Investing
OK, now let’s get to the review on Bill Mencarow.
This guy has a pretty impressive work history unrelated to any kind of investing. He was fulltime fieldman for the Reagan for President campaign, put in charge of volunteers at the Republican National Convention, then was a senior advisor to the Reagan Presidential Transition.
He was a Chief of Staff, legislative director and press secretary for many years in the US Congress. He has managed political campaigns at the federal level and provides consulting services on select campaigns even now.
He’s been interviewed on most networks and major U.S. newspapers and magazines. He’s been in televised debates with the likes of Jane Fonda, Gore Vidal, and Paul Ehrlich. In addition to all of that, he’s an ordained minister and semi-retired pastor.
So yeah, this is a smart guy who has carved out a place for himself in political realms and has garnered attention and respect across social and political lines.
So how did he end up in the note investing industry?
One Too Many Gas Leaks Sent Him to Buy Real Estate Notes
It started with one-too-many middle-of-the-winter-night phone calls from a distressed tenant in one of his rental properties. There was a gas leak, and, as the owner and landlord, he had to get out of his warm bed and deal with it.
Mencarow and his wife owned a number of properties since they had ventured into real estate ownership as a passive income strategy. Their rentals were in decent neighborhoods where they assumed the homes wouldn’t need massive amounts of upkeep or maintenance.
What they didn’t know was the extent of the tenant issues they’d encounter. Marijuana use, visits from federal agents, tenants who actually died in the rentals—these were a few of the things they experienced as owners and landlords.
It didn’t take too long for Mencarow and his wife to decide to ditch the rentals in favor of a different investing avenue: mortgage/trust deed note investing.
What are real estate notes and what is note investing?
A note is also called a promissory note, a trust deed, a mortgage investment, or paper. Investopedia.com defines a note as a debt security obligating repayment of a loan at a set interest rate in a defined time period.
There are three types of notes (unsecured, promissory, and convertible). Mencarow focused on the promissory note—a written documentation of money loaned or owed from one party to another.
A promissory note includes loan terms, a repayment schedule, an interest rate, and payment information. The borrower signs the note and gives it to the lender.
Mencarow found that being a note-owner instead of a landlord removed all kinds of headaches—middle-of-the-night tenant emergency calls; no tenant lawsuits; no liability for code violations; no equipment or appliance replacements; no expensive renovations; and no pest infestation dramas to deal with.
It was 1981 when Mencarow and his wife, Alison, ditched their rentals and became note investors instead. In 1987 they started The Paper Source, Inc., a provider of real estate note investing/brokering education.
So basically The Paper Source (papersourceonline.com) is an educational resource with a bunch of delivery methods—a magazine subscription; physical books; e-books; symposiums and conventions; and blogs and articles.
Free Paper Source Resources
The Paper Source has a number of free educational resources, including an e-course taught by Mencarow, available at papersourceonline.com (The Paper Source website).
Additional free information, listed under the Resources tab, are frequently asked questions (with answers) and blogs.
FAQs give information on what a cash flow note is; why notes are discounted; how you can make money with notes; what a seller carryback note is; how to broker a seller carryback note; who buys cash flow notes; how to convince a note owner to take a discount; private investors; internet investors; the legitimacy of internet cash flow sites; the truth on infomercials; and other topics.
The FAQ section also contains numerous short videos of Mencarow addressing different subjects.
Blog posts, which can be accessed and read for free, cover topics such as:
· Good News for Single Family Home & Note Investors
– Trust Deed Investing Risks
– Where to Buy Mortgage Notes
– Buying Real Estate Notes from Banks
Charged Paper Source resources
Paper Source Note Symposium 2017 is a three-day Paper Source conference Las Vegas that costs $499. It claims to be the cash flow event of the year and promises:
· Seminars on how to find, buy and broker real estate notes—performing and non-performing—and under-the-radar cash flows
· Education on how to create multiple streams of income
· Opportunities to network with the best of the best
· Complimentary personal consultations with experts
· A trade show where participants meet investors, hedge funds, servicers, IRA experts, and more
· Cocktail receptions, white tablecloth luncheons, and continental breakfasts
The Paper Source Journal subscription + Registry of Investors ($79.00/year)
The Paper Source University Note Pro Course ($397). Course price includes:
· One-year subscription to The Paper Source Journal
· E-Registry of Note Investors
· The Complete Package of Note Brokering & Investing Articles
· The Paper Source’s Own Contracts (instant download of 50 contracts and forms for notes and real estate)
· Access to private Facebook page
· Email coaching
· Over 150 back issues of The Paper Source Journal with articles on topics like what you should know about trust deed investing, trust deed investing in California and Texas, buying notes for dummies, and trust deed investment funds and companies
· 7 classics of note investing (digital downloads)
· Access to videos from 2013, 2014, and 2015 live events
The Complete Package ($199.95)
Mencarow describes this resource as being “for people who have experience with notes. It is a digital dump of almost everything we have available, in no particular order. It is not a step-by-step course—it’s for those who want to focus in on certain topics and pick and choose what they want to self-study.”
The Paper Source store offers products in several categories: Taxes & IRAs; Seller Financing; Note Beginners; Forms/Software; and Cashflow Profits Videos.
Here are a few samples from the store:
· Tax Free Note & Real Estate Investing (E-book; $18.97; immediate download)
· Ca$h Now Seller Financing (33-pg book; $19.97)
· Taking the Mystery Out of Money (253-pg E-book; $19.97; immediate download)
· TValue Amortization Software (software and manual; $149.00; instant download)
· Owner Will Carry (205-pg E-book; $29.95; instant download)
In terms of a social media presence, The Paper Source has an active presence on Facebook, Twitter, and LinkedIn, and active as of three months ago on Google+. It is not active on YouTube.
Whenever I review a person or system or product, I like to check out independent forums or sites, including the Better Business Bureau. I didn’t find much out there on The Paper Source—nothing on BBB or on any gripe sites.
BiggerPockets.com, a social network with a discussion forum where new and experienced real estate investors talk about the pros and cons of people, programs, and resources, had this one short thread:
Q: Has anyone bought The Complete Package from The Paper Source? . . . Was wondering if it is worth it. (Julian; investor from Washington; posted a year ago)
A: I love The Paper Source and Paper Source University for learning the notes business. (Brian; California)
That’s about it in terms of online discussions, which surprised me. There are plenty of testimonials on The Paper Source’s website, however.
Noteinvestor.com ran an interview article with Mencarow in October 2011. I’m going to wrap up this article with a bit from that piece.
The question asked was: What advice would you give to new professionals just starting out in the industry? Here are a few of Mencarow’s tips:
· Never buy anything from an infomercial
· Get to know who the genuine institutional investors are—there are very few
· Never use private investors unless you have done at least 100 deals with institutional investors and have learned all the pitfalls
· Never look for real estate notes for sale on Craigslist or anywhere else on the Internet
· The bigger the deal, the less likely it is to close—make it big on little deals
I’m going to leave this review of Bill Mencarow and The Paper Source there.
Hope it was helpful!
And hey—if you didn’t watch that video I posted earlier, please scroll back and give it three minutes of your time. It’s an opportunity that you might be very glad to learn about.
It could be the best three minutes you ever spent.
Thanks again for stopping by, and best of luck!