I'm hurtin' bad. - Posted by Carbo

Posted by Carbo on June 22, 2001 at 13:16:27:

Although we’d all love to, financially it is impossible at this time. Kind of a Catch 22 thing going on. I could get back in the swing of things if we returned, but I don’t have the cash to do so at this time.

I’m hurtin’ bad. - Posted by Carbo

Posted by Carbo on June 22, 2001 at 12:26:12:

I don’t know if this is the proper forum for this post. If not, the powers that be will surely let me know.
Those of you willing to indulge me, I’d like to lay out a little background so you may have a better understanding.
I’m 46, married, father of two. I’ve been self employed for about twelve years in residential real estate. During that time I done handyman deals and many varieties of lease options. Suffice it to say I was able to support my family comfortably, had a good name out in the community, and my real estate business was running efficiently.
Then the decision that rocked my world was made. At my wife’s urging we decided to move out of state, 2000 miles across country. Two months after arriving I realized I had made the mistake of a lifetime. The locale I had left did business the old fashioned way. A handshake meant something. Lawyers were not required to buy/sell/lease/option a residential property. Honesty, trust, and fairness were factors at play in most every deal.
Also, we were experiencing a buyers market which, of course, makes more sellers and deals available.
Flash forward to my present reality. I live in a state where most people will not even sign a standard one year lease agreement without consulting an attorney. Where someone’s word is worthless. Where the only thing that matters is feeling that you won, and the way you get that feeling is by crushing the other side. Geez, what a way to live and work everyday. My mindset is different and I don’t want to become like this. Hell, I don’t even know that I can. My finances are now in a state of disarray I never thought I’d experience. Prior to my move, and for all of my adult life, my creditworthiness was AAA+, a FICO score of close to 800. I was averaging two to three deals a month. Didn’t owe a penny on my credit cards, vehicles paid off in full, some reserve cash in the bank. We weren’t rich, but certainly in control of our financial futures. Today, I can say that in the two years since our move I have done a total of three minor deals. I owe about $55K on my credit cards, and must now consider filing bankruptcy. I’m feeling the weight of the world on my shoulders and don’t see any way out. To say I’m discouraged is a gross understatement. Luckily, I’m not the addictive personality type or I’d be deep into a bottle by now. This is all I know, and I don’t know a way out of this awful and threatening mess I’ve created for myself.
Look, I don’t expect anyone here to have a magic answer for me, or for someone else who may find themself in this position one day. Perhaps I needed to write this out for my own clarification. Thanks for listening, and if you have some constructive criticism and/or advice please feel free to offer it up.

Re: I’m hurtin’ bad. - Posted by Marc(SC)

Posted by Marc(SC) on June 23, 2001 at 10:12:42:

Carbo, I have a friend who is 23 years old and destined to live with his parents for the rest of his life due to the fact that he suffers from consumeritis. He owes approx. $30,000 on a new motorcycle and truck. He also has amassed $20,000 in credit card debt, probably with rates approaching 20%. To top it off, anything left over goes toward child support.
However, there is hope for him yet. He contacted a debt consolidation company for help. They are working with him to negotiate his credit card rates down to around 6%; consequently, within 2-3 years this debt may be erased. He also, “pays himself first.” In his case this involves investing in 401K and mutual fund. In your case, maybe it could be a moving fund. My own personal philosophy when it comes to depreciating debt is to wage war on it. Liquidate all non-essential assets and focus all available moneys toward the highest interest rate debt first.
Although many on this board may disagree, I might think about taking a job in order to assist in my regular debt reduction payments (as well as for insurance…ect.), yet still try to complete some RE deals part-time.
The compounding interest on your debt is probably your biggest enemy. I would focus my energy there first.
My favorite way of looking at problems is to remind myself that “everything is a cinch if you take it inch by inch.” Write all your problems down on paper. Then analyze each problem and try to identify the underlying causes and scenarios which may elleviate each. This will help you to avoid denial and form a plan.
I hope this helps. Let me know if you need specifics on the debt consolidation company, I can find out from my friend.
Best wishes. - Marc

Re: I’m hurtin’ bad. - Posted by Valerie

Posted by Valerie on June 22, 2001 at 21:56:19:

I am going to tell you something that I have learned in my life. When everything in your world falls apart… BUY GLUE!!! Put the pieces back together one at a time. Trying to tackle everything at once will only make you crazy. Prioritze and work from there. I agree with everyone here with their suggestions and as a newbie still living paycheck to paycheck, I know what it’s like not to have two nickels to rub together.

My sincere advice is to step back and look at your situation from “outside”, what would your advice to you be???. Sit down and think about how you got started in the first place… you know “bread & butter” deals. Whether flipping, rehabbing or whatever, you had to start somewhere. Network, Market (I just made two posters tonight on my computer, took them to CopyMax to be enlarged and laminated = $8.00, of course, I had to wait until payday-GRRR), attend the local investors meeting. Do SOMETHING!!

Please keep your chin up. Things will turn around BUT YOU HAVE TO MAKE IT HAPPEN!

I wish you only the best of luck and please let us know how you are doing. By the way, where are you living and where did you move from? I ask because where you are now sounds like where I am! LOL

Re: I’m hurtin’ bad. - Posted by Ronald * Starr

Posted by Ronald * Starr on June 22, 2001 at 20:43:26:


You’ve already gotten some good advice, most of which I agree with.

I’m surprised you’ve been where you are so long and have not figured out how to work in that environment. My YES for SUCCESS model says “Y” you invest in an “E” environment, using a “S” strategy that you like and fits you and the environment, generating profits. You have moved to a new environment. Your old strategy does not work well, apparently. You have two choices, both of which have been mentioned by the other posters: either change the environment – go back where you were comfortable, or maybe to some other new place a bit closer – or change your strategy to fit the environment where you are now. What will work where you are now? There are many thousand different ways to make money with real estate. There have to be several dozen that will work where you are. Try and find or figure out one that works well and that you can tolerate for a while.

For some new ideas on profitable investing, you might want to read Jack Reed’s book “How to Buy Real Estate for at Least 20% Below Market Value.” He sells it on his website johntreed.com . It might even still be in a few bookstores in your area, although he no longer distributes through the bookstores.

Could you attend a real estate investors group meeting locally or nearby and link up with some successful investors? Help them for money, or learn from them what works where you are?

Could you get a property management job with living quarters to cut down your expenses?

Too, it puzzles me that you got this far into trouble before you asked for help or figured out how to turn things around. I know that I have some personality characteristics that tend to hold me back from doing as well as might be possible. You might want to do some gentle meditation and self-understanding to see if you are holding yourself back. Perhaps you can figure out some changes in approaches that will allow you to soar again.

Good Investing and Good Problem SolvingRon Starr****

Re: I’m hurtin’ bad. - Posted by Blane (MI)

Posted by Blane (MI) on June 22, 2001 at 19:59:41:

As you can see, you’re not alone. Frankly, if I was “only” 55K in debt on credit cards right now, I’d be dancing in the streets. But there’s got to be a way to fix it.

You obviously have all the pieces of the puzzle, you just have to put them back together. I like that “go back, stay in a cheap hotel and do a deal” idea. Also to hit those credit cards one more time and move back. A deal or two will likely erase that bit of debt AND put a little food on the table, yes? So get your better half on board and go for it, you’ll be glad you did. Good luck.


Re: I’m hurtin’ bad. - Posted by Scott Shubert

Posted by Scott Shubert on June 22, 2001 at 19:16:42:

I don’t know what part of the country you are in now but it may be that there is more opportunity where you are than you realize. Just because business is not as laid back as it was where you were from does not mean that you cannot do business there. There is a lot of good information here on how to do REI in inflated metropolitan markets. Consider learning more about what works in you new area such as “subject to” see Bill Bronchick’s courses, getthedeed.com, etc. land trusts, Pactrusts, flipping might even be a good way to generate some cash and even though you might not be able to do it on a handshake you can do it anywhere.

Good luck and don’t let discouragement bring you down!

Been down the same road myself - Posted by Kevin

Posted by Kevin on June 22, 2001 at 18:40:08:

Like you, I had AAA+ credit until the day my daughter decided she was ready to be born 2 months early. Two & a half months & $1.3 -$1.5 million later (stopped counting at $1M), we were bankrupt. CRASH!!! I thought about suicide, but I was raised a fatherless child all of my life & wouldn’t dare put my child through the same ordeal. My wife was unable to work for the first year of my daughter’s life in order to take care of her, complicating things further. I filed chapter 7 last November, and have had a huge weight off of my shoulder’s since. Don’t get me wrong, I wasn’t proud of what I did, but I couldn’t just pull a million bucks out of my wallet–& then pay the regular bills. It was humiliating! I learned one giant lesson through my pastor–humility builds character. Sounds like an oxy-moron at first. Think about this for a minute. I don’t know your beliefs on God, but this is very evident in every day life as well–you have to look for it though: Before God can transform a person’s life, that person must first acknowledge inferiority & wrongdoing (humility) & ask for forgiveness (and mean it) before God will honor his/her request of a changed life. Kinda like stealing a candy bar from 7-11 & begging mom not to beat you to death. Upon conditional agreement, mom tells you to take the candy bar back to the clerk, tell the clerk you stole it, & pay for it out of your nickel a week allowance. Since mom isn’t as forgiving as God, she takes the candy bar and eats it in front of you after you paid for it, & you don’t get jack (other than avoiding a beating). Anyway–things will get better!!!

Re: I’m hurtin’ bad. - Posted by Mark - MO

Posted by Mark - MO on June 22, 2001 at 13:46:07:

Why not drive out to the old locale, stay with a friend or at a cheap hotel, and do another deal like you used to. Or do some of it long distance if you still feel you can trust people well who live there. Then take all the profit from the deal and use it for moving expenses. It will take some time, but you can think of it as a very smart investment in your life. If I was you I would even go into MORE credit card debt to pay for the move if it meant that I could get back to doing profitable deals and avoid bk. If you did so well working for yourself in this industry then I already know that you are smart and a problem solver. Now you get a chance to solve a problem for yourself.
PS - Where are you now and where did you live before? Maybe I or someone here can help.

But you are NOT dead! - Posted by Jim IL

Posted by Jim IL on June 22, 2001 at 13:38:52:

I have to tell you, I do feel your pain my friend, trust me there.
The debts you describe very well may seem overwhelming for you NOW, but trust me, you are FAR from rock bottom.
Do you have a roof over your head now?
Do you have food to feed your family?
Are they all clothed?
Is anyone dying from a terminal illness?

Hopefully the answer to all is "No!"
Asking myself these questions made me realize that my own life at one point was not nearly as bad as I felt it was.
The person who asked me this was my wife.
This lady had been a single mother, in and out of different living situations, including being "homeless"
She said to me one day when I was complaining about how “Slow” our business was some months back, "Jim, Have you EVER lived in a shelter? Do you know what it is like to NOT have enough food?"
Well, thnk God NO! I did not.
She then pointed out the “home” that we live in and said, "Jim, this is the nicest house I’ve lived in as an adult, EVER, and YOU made that happen."
She was right.
So, if what you are doing now is not working, then DO SOMETHING ELSE!
Sounds simple, but we all know it is not.
What must you do?
Couldn’t tell ya, every market is different.
Personally I’d head to the courthouse and pull some files. Mail letters, call, and get a deal or two that way.
Then, when you collect money from those deals, spend a mess of it on Marketing.
SHOUT to the world that you exist, and what you do?!
Calls will come, deals will get signed, and everything will be alright.
This is the ONLY business I’ve ever been involved in where one deal, to just a few can make a person enough money to solve many problems.
Heck, I was once down to less than $10 in my checking account, and this was not too long ago. (within the last 18 months.)
You know what I did?
I spent $5 of that money on some sign making material, and the rest on Gas for my car.
I placed up some home made signs, got a deal done within one week, sold it, and had a few thousand in my account.
ONE deal and I was back on track for my marketing.
I now have a policy that a certain portion of ALL deals goes back into marketing.
If you keep the buying machine going, you will NOT have these problems, trust me.

Good luck to you,

Believe me?I FEEL your pain! - Posted by SusanL.–FL

Posted by SusanL.–FL on June 22, 2001 at 13:12:19:

First of all, any chance of moving back ?from whence you came?? Maybe the wife will ?bend? a little, ESPECIALLY if she sees that ?the move? has resulted in you becoming a ?broken man? (both financially$ and mentally). :frowning:

Hopefully, a word of encouragement here: If your total debt is?only? (and I?m being facetious when I say ?only?) totals $55K, then I say DO try to hang it there and DO try to avoid BK if you can.

I am just now pulling out of a similar situation$ (after nearly 5 years) but my debt load was over 8 times yours (credit cards-$50K, 2 car loans-$62K, 9 mortgages, ad infinitum). It is somehow a miracle that I survived, but the point being is?it CAN be done. And YOU can too!! As a matter of fact, only 28 days ago, I finally paid off my back taxes from 97 and 99?.And I have only $6,000 remaining of my old debt.

I?m sure you?ve had your share of maddening days where you felt like you were on the verge of cracking up and that you felt less the man you used to be because you couldn?t support your family the way you felt they should be. It DOES take its toll physically, mentally, and emotionally.

I hope the others have some answers or solutions for your predicament. I will say this?the entire support network on this CRE board is what helped me keep my sanity and who helped me get through some of my darkest moments. A special salute to my ?comrades in arms?! :slight_smile:

I?ll keep you in my thoughts.


Re: I’m hurtin’ bad. - Posted by JohnBoy

Posted by JohnBoy on June 22, 2001 at 13:10:26:

Have you considered relocating again? Perhaps moving back again?

Re: I’m hurtin’ bad. - Posted by Carbo

Posted by Carbo on June 25, 2001 at 10:38:35:

Marc, thank you for your reply. I apologize for the delay in replying but my internet connection was down since Friday evening. I’m not ready to go to a debt consolidation company yet but, if I decide to go that route I’ll do some homework and have a look.

Re: I’m hurtin’ bad. - Posted by Carbo

Posted by Carbo on June 25, 2001 at 10:52:05:

Blane, thanks for the reply. I appreciate your opinion as I weigh all my options and try and plan a course out of this mess I’ve gotten myself into.

Re: I’m hurtin’ bad. - Posted by Carbo

Posted by Carbo on June 25, 2001 at 10:54:47:

Scott, thank you for your time and opinion. In fact, one of the problems I’ve run into is that I moved from a buyers market into an extreme sellers market. Most homeowners here have the attitude, “Go to hell, don’t need ya!”

EXCELLENT ideas, Mark!! [nt] - Posted by SusanL.–FL

Posted by SusanL.–FL on June 22, 2001 at 15:17:30:


Re: But you are NOT dead! - Posted by Carbo

Posted by Carbo on June 22, 2001 at 14:36:02:

Thank you, Jim. You’re correct, of course, on many of the things you’ve written. How true that it’s always a good idea, for all of us, to count our blessings rather than feel sorry for ourselves. I must admit to being swept up with that mode on more than one occasion. It’s good to be reminded of that, although you would never be so bold as to say so. Appreciate your thoughts and encouragement.

Re: Believe me?I FEEL your pain! - Posted by Carbo

Posted by Carbo on June 22, 2001 at 13:19:18:

Hi, Susan. Thank you for your words of encouragement.
My wife would start packing now to return to our old lives. But we can’t. Simply a matter of not having the cash for the move and all it entails.