During our lunch break at the office yesterday, I begged off from doing something which I have dreaded for the past 12 years in the corporate world, Christmas party presentations! You might be asking what the heck does this have to do with investing in foreclosures in the Philippines? Read on to find out.
This year it is going to be different
During this time of the year, most of us unlucky enough to be employed in a company who force employees to participate in Christmas party presentations that only cause undue stress and humiliation, dread the thought of being forced to go through it all over again. If some people want such activities then fine, let them volunteer for it, and spare those who don’t want to make a fool of themselves.
I really find it silly that people tolerate such a time wasting activity during the time of year when people who really do work are busiest because of the reduced workdays and tighter deadlines, simply because it has been a tradition. I would rather have games and other really fun activities where people just need to attend the party and have fun, relax, and enjoy. That’s what having a party is for, right?!
Since I have already decided to quit the corporate world (my last day is at the end of December 2009… yipee!), I said to myself that enough is enough and I did not attend our group’s practice for our Christmas party presentation that was to eat up half of my lunch break. Instead, I decided to visit the bank officer handling my account to pay for the fire insurance for a foreclosed property I recently purchased.
We always have a choice but…
Wait, before anyone of you thinks of quitting your jobs to start investing in real estate, bear in mind that I am at this point after more than 4 years worth of preparations and I already have income streams other than my earned income from my job. Besides, with or without my real estate investing activities, I can see that I really would have called it quits for a lot of reasons that I would rather not discuss here.
Whew, with that out of the way, let me continue by saying that although we always have a choice, there are times when making the choice is really more difficult. In my example above, it was easy for me to choose paying for the fire insurance for my property over practicing for a dance number where a forty year old like me will have to wear a mini-skirt and dance to the tune of “Nobody nobody but you” by Wonder Girls… such an unpleasant thought, definitely not my idea of having “fun”.
But what if you had to make a choice between your son’s first ever recital and a conference call with your counterparts from abroad. How about choosing between being with your wife on her birthday or to be in Singapore for a regional meeting or spending your birthday with your wife and son or be in an annual planning session… the list goes on and on. I had to make these difficult choices in the past. Not anymore…
Just what is time freedom and how do you get it?
My definition of time freedom is being able to spend your time freely to do what you want, when you want, and with who you want. I believe that time freedom is a by-product of having passive income streams, and a good example would be those from passive income generating properties.
How? Buy a foreclosed property with a good enough net operating income to produce positive cashflow, fix it up, rent it out or sell it through a lease option. Might sound easy but it’s not, keep in mind it took me four years to buy three foreclosed properties. However, if this will help me get time freedom, then I believe it is all worth it. Besides, although it is not that easy, it is definitely possible and is not as difficult as you think.
So the next time you feel like giving up on real estate investing, just watch a video of your Christmas party presentations and ask yourself “Do I really have to do this…?!”. It just might help you snap out of it. Merry Christmas everyone!
—
To our financial freedom!
Jay Castillo
Real Estate Investor
PRC Real Estate Broker License #: 3194
Blog: https://www.foreclosurephilippines.com
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Text by Jay Castillo. Copyright © 2008 – 2011 Jay Castillo. All rights reserved.
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HI Jay!
Just love this post! I can empathize! I hate all those dance steps!!
Ive read Robert Kiyosakis book and also recently bought CASH FLOW 101 board game online!
Inspired me know to move my butt. Got inspired one of your post on how you had to amange your personal finances before you can move on to this. After reading that post i re- worked my excel file on budgeting.
Thanks Shai, glad to see you can relate… just thinking about the dance numbers during Christmas parties make me say ARGH! hehe!
Glad to see you are working on managing your finances, keep it up and Happy New Year!
Jay,
I chance upon this website last November 2009 and eversince has been reading your post which is very interesting. I am incline to start to delve into this real estate business as an alternative to my plan to slow down on my work as an OFW working for an oil and gas company.
Hopefully I can contact you from time to time to get more tip on how to make the dealings in this business.
Many thanks to you and keep up the good work.
Regards.
Rolly L. David
Thank you so much Rolly for the kind words. Feel free to contact me anytime. Thanks again for dropping by!
Idol Jay,count me in to the group. I’m really looking forward to join a group with common interest. Happy New Year!
Ikaw ang idol ko Jun!
Hi Jay, btw, is this third investment property for cashflow also or for your personal use (since you got hit by Ondoy)?
Hope we could meet up soon bro!
.-= Bryan Uy´s last blog ..Four (4) Keys to Successful Change =-.
Hi Bryan, only saw this comment of yours now. Nope, that was also for investment purposes. That’s the one I showed you after we attended the tax delinquent auction in Antipolo. 🙂
Hi Jay!
I love the strong humor in this post! Makes one really think hard whether to pursue a one-path career in the corporate world or to start thinking about leaving the rat race.:)
Your definition of time freedom as being able to spend your time freely to do what you want, when you want, and with who you want reminds me of Tim Ferris’s Four Hour Work Week. Thanks for introducing me to that book. It had and still has a great impact on me, especially in saying “No” to not-necessarily-bad-but-not-really-necessary activities
By the way, do include me when you, earth and gleceper play the cashflow game. Really love to play this with common-minded friends!
God bless and a Happy New Year!
.-= Bryan Uy´s last blog ..Four (4) Keys to Successful Change =-.
Good luck for your new found freedom, Jay. I am looking forward to be free from 8-5 work and commuting 2 hours from Muzon, CSJDM to Intramuros two years from now. Merry Christmas too!
.-= Eleazar | Entrepinoy Bank´s last blog ..How to Make Money For Christmas – 5 Simple Ways to Make Money With No Start Up Costs =-.
Hello Eleazar, thanks! Although I am to extend for another 1 more month to give ample time for proper turnover and some unfinished business. When I read about your daily commute of 2 hours, I can’t help but remember my more than 3 hours of daily travel to/from work when I worked at makati but lived in Marikina during the time when the Katipunan flyover was being constructed.
I wish you all the best from one pinoy entrepreneur to another. 🙂
Happy New Year na rin!
Hi Jay,
I’ve been a frequent visitor of your site since I stumbled onto it this year. Your posts are very informative and inspiring. Keep it up. BTW, is there a group, which regularly meets up to discuss and share information regarding various passive income streams? Thanks.
– Carlos
Oo nga Jay.
Meeting naman tayo. tapos cashflow after. May Free time na rin ako, as you may have known 😉
Sure pre, we should meet soon! Wow, didn’t know that… congrats! Pag usapan natin when we meet, I would like to compare notes and if you don’t mind i would also like to ask for some pointers from you. Text kita once ma set ko with Earth yung sked so he can bring the cashflow game board 🙂
This would be great. Sama ako dito, kung pwede.hehe
Hi Carlos, thanks for visiting and for the kind words! Actually we are planning to have meetups where we can share info and much like a real estate investors club and then maybe we can play cashflow 101 afterwards if anyone wants to. Nothings definite yet but I will announce it here once things are finalized.
Looking forward to it. Will also be at the 2009 Housing Fair.
Have a happy and blessed Christmas!
Yeah I hope sir jay and his team can make a meet up thing so that people like us (aspiring investors) can learn more about real estate investing from people (experienced) like sir Jay and others. I’m a regular Cashflow player and pretty much love to play the game with experienced real estate investors. We’re looking forward to this meet up.
HI Jay,
Like you, I have been a Kiyosaki fan since the first publication of his RD/PD series. Lucky for you, you finally snatched up your first property. For me, I had been on the lookout for such property for 2 years now but I have yet to make my first purchase.
I am already on a semi-retirement stage ( I retired at 32, that was 2 years ago). I call it a semi-retired stage coz I still have to work a few hours a day to supplement the income coming from my paper assets. Of course, my ultimate goal is to get there without looking at my financial instruments’ chart ever again. And I know it is only through building up assets that provide the passive income will these goals become a reality.
Please continue posting. You may not be aware of how much a number of people you are helping through your insightful articles.
–Jojo
Wow, It’s been 12 yrs ( not sure ) since RDPD was published and still the message of the book is more important than ever.
Hi Red, as they say, the book Rich Dad Poor Dad is timeless. 🙂
Hi Jojo, at least you are just on your second year. For me, it took more than 3 years. 🙂
I’m really glad to know you already have paper assets, I guess achieving your ultimate goal will be easier. Although the type of asset is different, the process is quite the same. Thanks also for the kind words!
Cheers!
HI SIr. jay, pede ko pong malaman kung anu na ung number ng passive income mu? kahit email lng sa [email protected] kung confi. ..hehe …thankyou
Hi Red, okay, will e-mail you later…
hi jay, i’ve been a long time lurker in your site, which i’ve found to be very inspiring btw. you really got me interested so much into real estate investing that i’m almost ready to start but the problem is i’m kinda worried on how to avail a 2nd loan for a 2nd investment in addition to an existing loan for the 1st investmnet. to illustrate: (a) for my first investment, i will avail of a P1M loan from the bank, pay the monthly amortization then then ideally rent out at a price that approximates the amortization; (b) for the 2nd investment, i will also avail another loan to finance it… would there be any problem with the financing institution to grant your 2nd loan if it finds out that i have an outstanding earlier loan (whether with the same bank or another)? would you know if they have a benchmark, like compare my income with respect to my ability to pay the 2 loans notwithstanding that i mortgage the subject property with the bank as collateral?
of course, the idea is that i will only shell out for the downpayment and pay the amortization through passive income (rental), right? so as much as possible, i should rent out the property immediately. if i get lucky and do rent it out right away then find another investment, pay the downpayment and finance the 2nd investment through a bank loan; rent it out again and rely on the rentals to pay for the amortization. how easy would it be to get a 2nd loan knowing that i already have an existing loan? can you give me pointers on what the bank usually look for me to qualify for another loan in this situation?
your advice is really much appreciated… keep up the good work!
would you mind sharing with us how much your first investment was & how you worked it out with the bank?
Hi Sushi, I believe you already have a good idea of how you can finance your investments. I say this because its like you were describing my first 2 deals. In my case, my financing was through a contract-to-sell(CTS), so the bank just did a less stringent credit investigation(as compared to bank financing through a mortgage loan). Although they knew I already had an outstanding loan, they just checked if my net disposable income was still enough so i can cover the amortization of my second property. The credit investigation was less stringent because in a CTS, the title is still in the name of the bank and will only transferred to me after it is fully paid.
*Update-I forgot to mention that the norm for the maximum monthly amortization the bank will allow for mortgage loans is about 40% of your net disposable income or NDI. NDI is your income less all obligations. This can be higher if your financing is through a CTS.
My first property’s minimum bid price was about 1.2M and I had to make a downpayment of 20%. As I mentioned, bank financing is through a CTS.
Thanks for the kind words and thanks for dropping by!