No Money Down Real Estate

Exchange of an investment property

2007-08-06T14:52:00.000-07:00

The exchange of an investment property is a transaction that can bring you some serious tax deductions. The process is quite simple, and for the moment is available only for properties of the same kind. To find out more about this and the meaning of the “same-kind property” keep on reading this articles. You will definitely find precious information that can help you gain a lot of money from property investments.

Like-Kind Properties and Exchange of an Investment Property

Investment properties are of the same kind, if they are of the same nature, even if they differ in grade or quality. Personal properties of a similar class are like-kind properties. However, personal and commercial properties are not like-kind properties. Also, personal property used predominantly in one country and personal property used predominantly in another country are not like-kind properties.

Exchanges are made for people wanting to stay invested in real estate, increase their leverage and to avoid paying high taxes upon the sale of property. Why do people prefer the exchange of an investment property? Well, there are several reasons:

 To restore depreciation by exchanging one property for another of greater value.
 The exchange of an investment property can be used to combine the equity of several properties into one large investment.
 In some of the cases, investors choose exchange properties just to change the investment location (and this could be made for other several reasons, such as appreciation possibilities).

These are the different types of properties that can be involved in exchange investments: rental houses, apartments, commercial properties, raw land, office buildings, retail properties, ranches and industrial properties.

A Successful Tax Deferred Exchange

Here are the things that must be done to gain some tax money from an exchange of an investment property. First, to make sure your investments are compatible for this type of action, ask for professional advice from a financial advisor. After that, and after you list the relinquish properties, you can enter in contact with the buyer for the exchange or sale of the property you wish to relinquish.

Once you do that, open an escrow for the relinquished property and coordinate with the facilitator. All the exchange papers must be signed by all parties or the transaction will be considered invalid.

You will be guided for the rest of the transaction by the investment property exchange facilitator. The rest of the process is straightforward and involves a lot of paperwork, but the benefits are worth seeing it through.

Whether you want a more valuable property, or just want to have a property in another place, just remember that these can be done with no taxes involved. Just ask for the help of an investment property manager, and he will give you more details on how to conduct an exchange of investment property transactions.

California Mortgage Loans

2007-06-22T20:23:00.000-07:00

Looking to purchase new homes in California or to refinance your existing mortgage at current rates, by analyzing California Loans Commercial Rates comprehensively you can find out how to consolidate your debt using your equity. If you've built up equity in your home then you can most likely refinance and get cash out when you need it. Are you looking to pull some extra cash from your home?

Owing to the easy accessibility of California personal loans and growing instances of cheating and illegal selling of loans, customers are advised to keep a few important factors in mind. When applying for California auto loans, it is essential to decide in advance on the amount and the term of the loan. California payday loans are usually provided without a credit check, as the sum involved is relatively less and the term of the loan is short.

Like lending rates of banks, California Loans Commercial Rates, also depends upon three ratios, the Loan-To-Value Ratio (LTVR), debt ratio and the Debt Service Coverage Ratio (DSCR). Also, since they're many lenders in California that offer direct loans in California, shop around and compare the options you have available. California debt consolidation loans are among the most popular options available to residents of California who wish to eliminate their debt.

How They Work In debt consolidation loans, all of your monthly bills are put into one lump sum payment that you can afford to make. There are a few factors that need due consideration before applying for California unsecured loans. California personal loans are basically two types -- secured personal loans and unsecured personal loans.

Conventional financial institutions such as building societies and banks offer unsecured loans, however, recently larger supermarket chains are also offering unsecured loans. California business loans can be obtained from banks, private lenders and building societies. Borrowers can obtain unsecured bad credit loans from private lenders.

There are online lenders who offer hassle-free private loans to borrowers. It is important for individuals to find the right source for California loans. Yet, California interest only loans can be a risky affair, as the interest rate may rise after the initial period.

California interest only loans of longer duration, for instance 30 years, are particularly helpful, as the additional money that goes as repayment of the principal, can be invested in a different place for a higher rate of interest. There are no rules to govern the terms and conditions of construction loans compared to mortgages that have standardized guidelines. Direct loans are less expensive compared to other loan options.

A danger that surrounds home equity loans is the inability to repay the loan. Additionally, those applying for a home equity loan should consider the possibility of a housing market crash. California auto loan applicants need to consider certain details about the intended loan.

Understanding your resource and income base will give you an accurate idea of what you can afford for your California bad credit personal loan. The intrinsic idea behind a bad credit personal loan is to obtain a loan to hold onto your property and, in doing so, to mend your credit and thus build a solid financial future. Even if you have bad credit, a payday loan may still be available to you.

Even if you have bad credit you can still qualify for a refinance loan, since your home is used as collateral. Naturally, no one wants to be saddled with a loan that could outlast them, but even then that isn’t always as bad as it seems especially if a fixed monthly payment can allow the homeowner to maintain their lifestyle well into retirement, whereas renting property has no guarantees of that. In Southern California where a two bedroom bungalow can sell for more than one million dollars, the only sort of financing that most people can afford must be for the longest term possible.

Generally, all lenders limit the amount a borrower can borrow owing to their poor credit history. Typically, you can borrow up to 75% of your paycheck, but this amount is variable based on your credit history, your employer, and the lending company’s policy. On the other hand, if you want a small amount of money to start your business, then you might go for an unsecured loan.

If selecting to refinance an existing mortgage loan, homeowners apply for a new mortgage, which pays off and replaces the old. There are a few basic things that need to be kept in mind, when trying to apply for a sub prime mortgage loan. Homeowners may either build a cash reserve to pay for this expense, or select a mortgage option with 103% financing.

California mortgage loans are long-term loans and similar to mortgage loans in other states. Like in any industry, finding a good lender is like finding a needle in a haystack. But don’t give-up you will find your lender.

Real Estate Deals - Ten Myths

2007-05-22T18:03:00.000-07:00

Are high-profit real estate deals only for the wealthy? Is it possible to buy with no money down? Do you really have to know the "right" people? Let's answer by looking at some of the myths of real estate.

1. The good real estate deals are reserved for the wealthy. Of course money helps, but my first deal was a $3,500 lot - which I sold for a profit two weeks after I bought it. Smaller deals, using partners, low-down deals, or just putting aside $7 per day for a couple years until you have enough money for a downpayment - these are some of the ways to start with a little and invest in real estate.

2. "Zero down" isn't possible. I sold a rental property for $1,000 down because I trusted the buyer, and I wanted the 9% interest and higher price. A cash-advance on a credit card for the $1,000 ($30 per month payments) would have made it a "zero down" deal. "Zero down" means none of YOUR money down, and yes, it happens.

3. "No money down" is the best way. When you don't invest some of your own money, you have higher payments. You also spend more time finding suitable properties, and pay more for them (cooperative sellers naturally want more profit for their cooperation). There are zero-down deals out there - they just aren't always worth doing.

4. You need a lot of experience. It helps, but you get it by investing. Start with common sense, be willing to learn the numbers, and you can start where you are.

5. Good investors have a "knack" for making money. Well, sort of. But more accurately, they just took the time and risk to learn the market and to continue their education.

6. You have to know the "right" people. This is another partly true myth. It does help, so why not start the process? Talk to other investors, real estate agents, landlords, etc.

7. Great negotiating skills are necessary. Negotiating skills help with real estate deals? Of course, but learn to run the numbers and make offers based on them, and you can be the worst negotiator and still do okay.

8. You have to have insider knowledge. Insider, outsider, whatever. You do need knowledge, but understand one deal, and you are on your way. Study, and study more, but the best "insider" knowledge comes from experience.

9. Fixer-uppers are the safest way to go. Poorly planned "fix and flips" have bankrupted even experienced investors. Most poorly purchased rental properties will only eat a little money every month, and grow in value over time. Fixer uppers are for making money faster, not more safely.

10. You need to make lowball offers. Low offers may help, but the numbers have to work, and you need a plan. You can offer MORE than the market price and make money investing in real estate. Just learn how to run the numbers before you do any real estate deals.

Article Source: http://www.articledashboard.com

Steve Gillman has invested in real estate for years. To learn more, go get your free real estate investing course at: www.MakeThatOffer.com

Buying a Home with No Money Down

2007-04-15T19:54:00.000-07:00

If you are on the market for a new home, you may want to look into buying a home with no money down, otherwise known as 100% financing.

The benefit of buying a home with no money down is that you will be able to use the money you normally would use for a down payment for other things, such as closing costs, or putting it toward new furniture. One of the requirements for buying a home with no money down is having excellent credit, or, at the very least, next to excellent credit.

Keep in mind, when borrowing up to 100% of the value of a home, the lender may charge you a bit more by bumping up the interest rate. The lender does this because when they approve a loan for 100% as opposed to 95%, they are taking on more of a risk. Therefore, they slightly raise the rate.

Remember, borrowing up to 100% can be very convenient if you simply don't have the money for the down payment, and we all know, we pay for convenience. Because of the slightly higher interest rate you may run into in this situation, you may want to consider shopping around for the best rate and product to fit your needs and budget.

The mortgage industry is a highly competitive one, and there are many mortgage companies out there across the United States that offer programs with the option to purchase a home with no money down. If you are not interested in doing the shopping around yourself, or simply just don't have the time, you may want to consider hiring a broker to do it for you.

Brokers have access to hundreds of lenders across the United States, making it easier to shop a few mortgage companies for you. It really wouldn't hurt to allow one of these brokers to assess your situation than let them speak with a few lenders to see what kind of deal they come back to you with. Once they have done this, you can base your consideration on the best rate and program they can get you for buying your home with no money down.

Keep in mind, mortgage brokers and lenders work on commission, so finding you a mortgage product and getting it to the table is just as important to them as it is to you. Best of luck.

Real Estate Clubs

2007-03-27T19:18:00.000-07:00

So, where is Montecito Real Estate? A new trend in the real estate investment industry is investment clubs or groups. So now you’ve learned about how much money is in investment real estate and you want a piece of the pie.

On the other hand, any time you’ve got a large real estate investment—say multifamily housing—or any time you’ve got substantial wealth, an LLC economically reduces investment risk and as an added bonus can even save the owners thousands of dollars a year in income or payroll taxes. While a sole proprietorship or informal real estate partnership may be able to keep its bookkeeping and income tax return preparation very simple, an LLC probably needs to file its own tax return if the LLC operates as a partnership, a C corporation or an S corporation. If you are a non-resident involved in the selling of Canadian real estate assets that you own, you should be aware of the applicable provisions of the Income Tax Act to avoid problems when the time comes for the sale to complete.

I feel that private investors, as opposed to government agencies, should be key players in taking control of these real estate assets,“ re-pricing” them to provide for the housing needs of regular people on a more realistic, economic basis. Like I said earlier you probably want to just find a trustworthy real estate brokerage that focuses on pre-construction projects and developments for the simple fact that these firms make their money from making their investors happy and the only way to do that is through making them money. Let's face it - real estate agents need listings and the more they have the more money they're likely to make through their real estate marketing efforts.

Although you can find real estate listing systems a dime a dozen there is nothing that helps you achieve the level of real estate marketing and sales "success" you want quite like a proven one, whether they're complicated ones at outrageous prices, or simple ones at reasonable cost. Tampa is a good investment area if you can manage to find pre-construction but is not at the top of our list for the most desirable investment real estate in Florida. Well, just a few short months have passed and a current read of the Sunday homes section of the San Diego Union Tribune shows that though the real estate market does not make discernible moves in a day like the stock market. A couple of months can easily define the local real estate trends.

So finally, if you are starting out in the real estate field you might want to seek out an investment group. Somewhere you can learn much faster then on your own? You can search on the Internet and be able to find a number of real estate investment clubs or groups in your area!

The Ultimate N.M.D.

2007-01-14T17:40:00.000-08:00

About twenty-five years ago I made one of the biggest gambles of my life by starting out with nothing and ending up with my first piece of real estate, a small apartment building. Most people would not have the guts, let alone, could stand the stress factor of starting with an empty building as their first real estate deal. It was such a steal, I couldn't past it up! And boy... I'm glad I didn't! As soon as I had the building filled, I then sold the building for more then twice what I had in it. My banker really loved me!

You see, my education in real estate is long and deep. So, I knew from day one what I was getting myself into! Everyone needs to educate themselves before attempting to acquire real estate as an investment.

Education... That’s exactly what this article is all about.

Just as Donald Trump had starting out, you need a great mentor with a proven track record to lead the way and support your efforts… also a proven business system that allows you to invest in all types of real estate without ever having to tie up all your own cash. It is the ULTIMATE NO MONEY DOWN. You will learn to buy real estate using a new business line of credit instead of your own cash.

If you are an avid goal setter you will want to read this to learn some specifics associated with real estate investing. However, if you are limited with real estate investing educational dollars and need to generate quick return on investment, I think fixing up cheap houses is an ideal beginning point. An untapped niche market in real estate investing is fixing up houses that can be purchased by America's renters.

The first house in a real estate investing career can be scary because it is the beginning of a new business venture. I contend that “cheap houses” are the lowest risk property for beginning a real estate investing career. Houses that really only need some yard work and a few gallons of paint are readily found in the real estate buyer's market.

In the single most valuable lesson in Donald Trump's real estate career, he learned how the government would assist buyers in purchasing property with little or no financial backing and how to get such aid. You see, half of the money that is made in real estate investment is with property that never made it onto the Multiple Service Listings.

Like Mr. Trump, millions of men and women have become financially independent by investing in real estate, and with the proper knowledge and experience, there is no reason why you cannot do it as well. A real estate investor applies the knowledge of the fundamentals real estate investing.

As with other investments it is very appropriate, and smart, to find out as much as you can about the property, since types of real estate investments and the level of risk they pose and level of profit they stand to make you vary widely. One of the key factors in staying a successful real estate investor is strict adherence to your investment strategy and criteria, which are tied closely to your investment goals.

Like any other investments, investing in real estate has its upsides and downsides, and since there are different types of real estate to invest in, you will need to do your homework. Maybe you’re interested in investing in the lucrative Florida and Las Vegas pre-construction real estate markets but you don’t know where or when to buy?

If you look at the general process for success in real estate investing you will see some important early steps involving legal and accounting advice. A lawyer and accountant are key members of your team. Including a good appraiser, escrow agent, and title rep. Taxation is a key element of successful real estate investing, so be sure to find an accountant who is well-versed with the constantly evolving tax code. When the money made from these transactions is used to reinvest in other ventures, the return rate highly exceeds any other method of Real Estate investing.

It will always cost you more to be ignorant, then to be educated about real estate.

Finding a Deal

Real Estate No Money Down

2006-12-12T20:13:00.000-08:00

Is It Possible To Buy With No Money Down?

Despite what the “no money down” courses suggest on television, having money does make real estate investing much easier. Making money in Real Estate investment is like what we call in the stock market investment circles made in the buying and this is also known as value investing. If you don't have the time to invest working on fixers or if you're tired of working on fixers to make money investing in real estate, try this method.

Whoever is trying to sell you such simplistic view of the Real Estate investing, doesn’t have your best interests in mind. If you set your mind to it, put together a winning team of professionals, have your own financial house in order, know great bargains when you see them, and can negotiate with sellers under severe duress, you have the potential to do well by flipping real estate. High level of control: With real estate you can do things such as write your own terms for the contract, increase the properties value, increase the rent, build, subdivide, negotiate lending terms.

What most people are not attuned to is the real estate growth of the university and the prospects of rental increase of the properties that are around the growth areas of the university. As prospects express interest explain that the investments are secured by real estate and do not exceed 75% loan-to-value (LTV) of the after repaired value of the home. But if you want to preserve the value of your investments, or make some money for your retirement, realize that those books are poor substitute for a real learning.

To be fair, you can make a lot of money in real estate and you can shorten your learning curve tremendously by buying some of these courses. I can assure you buying Real Estate with no money down is an advantage. Investing in real estate with little or no money down is done every day.

The most special reason that no money down methods deliver fast and sure Real Estate wealth is this. Thats what no money down investing can do for you. But when you discover how to control deals without needing any money down, you can do 100 deals per month because you know how to do no money down.

Don't waste your money buying real estate guru books, DVDs, programs, seminars and mentor-coach promoting no-money-down deals. Before you spend money on these expensive programs, here are my top ten “no money down” ways to buy real estate. In conclusion, there are many ways to make money from real estate investment and what’s missing is massive action on your part.

In conclusion, we have highlighted three simple steps anyone can take to make more money from their real estate investment. In conclusion, this article has highlighted three reasons why commercial property real estate investment may be better than private real estate investment. In conclusion, take a closer look at the next real estate investment property that you purchase today and examine it if there are any additional rights that you can sell.

Purchasing foreclosure property can be good for real estate investment because sometimes, depending on how long the loan is outstanding, the bank might want to release the property at a price under the market valuation so as to sell it off. "Yes, but the value of property can go down too!". True the property market can go down, but if you follow the right investment strategies you wont loose money. It is that true the property market can go down. However if you never sell how will you loose money? Others buy a run down property, and put work (and money) into renovating the property, expecting to be paid well for their efforts - especially if you concentrate on the changes that drastically improve the look and value of the property.

How Home Staging Can Help Sell Your Home

2006-11-20T19:36:00.000-08:00

Home Staging is often done when you sell your home. Staging a home can bring you a much higher selling price.A home staging professional can be hired to tour your home and direct you to make the changes that will increase your homes marketability. Make sure the stager you hire is accredited.

Staging a home is not redecorating it. Redecorating a home focuses on the seller and their personality. Staging focuses on the buyer. It provides the current home owner with the knowledge to rearrange the furnishings, pictures, accessories, etc. in the best possible manner to enhance the rooms function, appearance and balance.

The seller of a home has a strong emotional attachment and often times lacks the objectivity to know what's best to enhance their homes looks.

Real Estate agents will often hire a stager as part of the selling package because they may be uncomfortable disclosing to the seller that their home needs work and avoid upsetting them.

The main purpose of the staging professional is to help the buyer see themselves and their belongings fit into the home they are viewing. They do this by rearranging the home to appeal to a broad base of purchasers. Stagers can be expensive, so if you want to go it alone please follow the tips below.

The first and most important consideration to prepare your home for sale is to unclutter. There should be NO clutter anywhere in your home. Go through each room and remove any clutter you see. Organize toys in decorative boxes that are hidden away in a storage room (perhaps a room for storage in the basement). You can always take them out again when you don't have any booked showings. Bookcases should be neat and attractive interspersed with a few ornaments. Closets should be cleaned out so that only clothes are visible. Remove storage at top and bottom of closets. Place clothes out of season in storage.In fact, place any clutter you have found in storage as well. You have to move anyway and you will have to pack less later when you do move!

The foyer provides the buyer with the first impression. It should be clean, uncluttered, bright and inviting. If any rooms are dull brighten them up with higher wattage bulbs in lamps.

Remove personal photos from all rooms if possible and replace with prints or ornaments. You want the buyer to focus on your home, not your personal life. This can be distracting.

A fresh coat of paint is mandatory. Paint your home in a neutral colour (white or beige is best).You can ad a splash of colour with colored accessories, pillows, throw rugs, candles, etc.

Bathrooms should be sparkling! Counters should be clear with no personal items visible. Tub tile grout should be clean and shower curtains and glass shower doors should be free of mildew. Hang fluffy, colorful towels on the towel rods.

Kitchens must be spotless.Remove all notes, magnets, etc.off the front of the fridge. Keep counter space clean and clear of all items. Clean out under sinks and organize the pantry. Paint outdated cupboards with a neutral colour and put new modern knobs on doors for a fresh look. Dishes on the floor for pet food should be eliminated during a showing.

Furnishings should be simple and minimal.Leave space between pieces and remove nick knacks. Your most attractive piece of furniture should be placed on the wall you see when you enter a room if possible. Tuck away Cd's, videos, etc. Hang pictures at eye level. Group accessories in odd numbers (one, three or five).Fireplace mantles should be depersonalized by removing pictures. A flower arrangement, mantle clock or piece of art would be appropriate here.

Garages, front and back yards should be cleaned as well. Plant flowers or shrubs in the yard for a welcoming effect. Prune any shrubs you may already have.Don't leave bikes or toys around the yard. Clean the pool if you have one. The lawn should be cut and watered to give the home a well cared for look. A coat of paint on the outside of the house may also be in order.

If you can afford a stager it is well worth the money. If not, just make sure you clean and unclutter! A spring cleaning will definitely pay off.This can not be stressed enough! A coat of paint will do wonders. Have lights on in every room (even during the day) and soft music playing before a showing. Spray a nice gentle room spray around the house to freshen it up. Be careful it is gentle or the buyer will think you are covering up something. All the best!Good Luck!

Get The Right Real Estate Information!

2006-10-09T21:04:00.000-07:00

Where is your ideal place to live? This is a tough one isn't it? I mean, how can any of us truly know for sure that we've discovered the best place to live. Many of us typically like where we grow up, therefore we tend to think of it as "home," and maybe even end up living there forever. Then there are those small percent that absolutely loath where they grew up, and never care to go back.

Regardless, finding that choice environment and home is no easy task. Furthermore, we want to be sure that we're not getting ripped off, and the value of our home will increase with time.

These are the standard imperatives. Now, do you know any great real estate investing information that can get you well on your way? If you don't, I can tell you where to find some. Ever heard of cyberspace?

Where would you think to go for real estate investing information? How about your local realtor? Hmm, this is a tricky one. Being the horribly cynical guy that I am, I may be inclined not to trust realtors. For some reason I only thing their in it for a profit. Anyway, probably your best chance at finding worthwhile real estate investing information is the World-Wide-Web.

How convenient is that!

All you need is your laptop and the sofa. Recently I have been sorting through websites and real estate investing information galore. I am simply not sure where I want to live. It's rather difficult when you have more things to consider than just your own personal likes and dislikes. For example, my greatest issue revolves around schooling. I must find a nice area with fabulous schools. This is always crucial when you have children.

Furthermore, in my humble opinion, one of the greatest real estate secrets of all is finding an area with a low crime rate. The last thing you want is to find out you've moved into mini-Detroit. This would not work out well if you ever wished to sell. Many individuals are searching for a place without a great deal of violence. It's called self-preservation. Now, if you've yet to determine where it is you want to live, then join the club.

The best thing to do is start scanning the web for real estate investing information and ideal locations. Hey, you can even check out the website, Findyourspot.com. It can help you get well on your way to finding that location of your dreams.

One Approach To Buying With No Money Down

2006-09-20T10:00:00.000-07:00

Distressed properties can be located in basically every city. They are available to those investors who have a clear vision and an eye for creating value that is currently obsolete. This strategy of investing is available to anyone, and is used by the most astute investors. The result is a solid, well-performing property that generates the most cash it possibly can.

Very often distressed properties need some maintenance, focus, and a new, professional management team to get the property up to speed with the rest of the market. If it is the owner who is distressed, they very often just want the property taken off their hands so they no longer have to deal with it. Commercial properties can often become difficult and expensive to maintain, and some owners simply don't have the time, money or patience to keep them up.

Distressed properties are identified by some sort of problem. This problem generally resides with two aspects of the property: either the property itself or the owner. The problem can be simple like a high vacancy rate of an apartment complex, or something much larger like the possibility of a property going into foreclosure because the owner cannot make the mortgage payments on time. This can ultimately ruin a person's credit if a property is to go into foreclosure.

Before we look at a few ways to locate distressed properties, let's first look at some specific characteristics of distressed properties that you may come across in your search.

A distressed property may have:
· high vacancy rates
· below market rents
· poor management
· old, run-down condition
· poor common areas
· no amenities
· low net operating income (NOI)

A distressed owner may:
· be too old to maintain the property
· have inherited the property and doesn't want the hassle
· cannot pay the mortgage
· be facing foreclosure
· be in bankruptcy
· be going through a divorce

Distressed properties can have a multitude of characteristics, combination of characteristics, and even odd problems specific to a property or owner.

So how do you identify these distressed properties? One way is to drive around your community looking for buildings that look vacant, run down, not fully leased, and those that display for sale by owner (FSBO) signs. If a property looks like a sore thumb in a nice area, then that is a flag that there might be something wrong. You can go to the county, find out who owns these buildings and send out a letter campaign telling them you wish to purchase the property. Many deals can develop this way, and you can get great prices on properties you didn't even know would be for sale.

Another way to find distressed properties is to call brokers on listings you find on the internet and simply ask why the owner is selling. You may have to call on quite a few properties, but eventually you will find that gold mine property being offered way below the market rate. With just a few changes that distressed property may be a money generating machine once more! You can even call on brokers to locate and bring you properties with problems that fit your targeted criteria. This strategy of finding distressed properties is a great one, as you can very quickly cut through the many listings that do not fit your criteria.

In order to turn these distressed properties into current market premium properties that retail investors would envy, use the following tools to bring the property up to par. You can renovate the building, change the management team, fill vacancies, add amenities, raise rents to market level, change the leasing agreement, lower overall expenses, and market it properly to a wider audience. With these simple tools, your once run-down, non-performing property will create more cash than anyone would have imagined.

Don't discount the value of poorly performing properties. Working with distressed properties can be a great way to purchase a property inexpensively and get your foot in the door of the commercial real estate industry. This investing strategy can be far easier than purchasing retail properties at a premium price! A little work and the property can be worth so much more, and supply you either passive income for years to come, or a retail property you can sell at a premium.

If you’re good with your hands, or are able to hire handymen this approach could become very profitable for you! By purchasing a home that needs some work you’re able to present an offer below market valve! The difference in the equity will allow you to buy with no money down! You see, you would use the equity for your escrow costs. That’s why it’s called “No Money Down!”

Investing in Real Estate 101

2006-08-27T20:52:00.000-07:00

Riches can be made in any kind of real estate market. A professional real estate investor makes money when prices are high and when prices are low.

No matter what is happening in the market they buy low and sell high. They never buy high and expect to make money waiting for prices to rise.

Newbies buy high expecting prices to rise, and when the prices drop they are left owing $175,000 on a house that is now worth $100,000. So as a real estate investor always buy low.

Everywhere there are properties selling for below market value. There are many homes in average neighborhoods that need a few thousand dollars worth of cosmetics.

For example, take a house selling for $100,000. Since you have done your homework you know it could easily sell for $145,000 or more if it looked better. Buy the house, spend $2,000-$7,000 fixing it up, and sell it for a sizable profit.

Never spend a pile of money to completely renovate a house. Just do cosmetic changes such as painting the inside and outside, putting in new carpet, fixing broken doors and repairing leaky faucets. Only do the basics to make the house presentable.

Real estate investors recommend you start out buying three-bedroom, two-bathroom homes. These are the most in demand and so are the easiest to re-sell.

Buy in neighborhoods that are nice. You do not want to buy in neighborhoods that are too nice or too rough. Focus on your average family-friendly neighborhood.

Also, buy homes that are listed at 60-75% or less of their value. Never buy a home that is listed at $100,000 with a value of $100,000. Buy the one listed at $75,000 that is valued at $100,000.

The easiest way to find these homes is to work with a real estate agent. Find one who will be glad to find you homes that meet your criteria.

Why work with a real estate agent? Agents have 85-90% of the properties for sale. They know the area. Tell them you are an investor right up front and what you are looking for. The great agents will be happy to send you all the homes you can handle, and you will be happy to pay them their commission.

Besides having a great agent you also need to have a niche market. Are you going to focus on foreclosures? Are you going to go after fixer-uppers? Are you going to buy and then quickly re-sell? Or are you going to buy and rent it out for a while?

If you are going to rent out your properties be sure you do the math. Will you be able to rent out the house for more than the monthly expenses? Be sure to include a property manager with those expenses. And remember that the house might sit vacant a month or two. Allow enough money to account for no income for part of the year.

So never buy a home that is going to cost you $1,000 a month in finance charges and other expenses if you can only rent it out for $800. That is a fast way to end bankrupt.

But before you do all this, before you get a real estate agent and go out making offers, there is one very important thing you must do first. You must write down your goals.

Is your goal to be worth $1 million within five years? That is very possible. But do not expect to reach 1/5 of that goal in the first year.

Start with a plan to make so many offers a week and stick with it, increasing it as you go. Since most beginners make one purchase for every 50 offers, have a plan to make one purchase a month. That would require you make 50 offers every month. Set the goal and little by little you will achieve it.

So you have your goals, you have a great real estate agent, you know your niche, and now it's time to make some offers. As stated, most beginners make one purchase with every 50 offers.

If you make $25,000 on that one purchase, then in effect you are making $500 each time you make an offer. So never think that you are wasting your time making those other 49 offers.

Just as important as having written goals, a great agent and a niche, you need to have the right frame of mind to deal with success. So many who want to invest in real estate actually cause themselves to fail. They self-sabotage their success.

Believe you can succeed. Learn how to handle money wisely. Educate yourself by reading and attending seminars. Surround yourself with people who have the same goals as you and who are achieving their goals.

There are many real estate experts out there, so find a good one, attend the seminars on learning how to think about money and be financially responsible, and begin your journey to buy and sell properties.

No Money Down Real Estate Investing

2006-07-30T16:51:00.000-07:00

You want to get into real estate - either for your personal use or for investment purposes - but you just don't have the cash to get started? What are you going to do?

There is at least one technique that virtually anyone can use as long as the property seller is willing to negotiate with you. To be fair, not every seller will be interested (or even understand) the concept outlined. Your best bet is to find a property that the owner has great interest in selling, whether because of moving, divorce or frustration with tenants.

In fact, if you are currently renting and thinking about using this technique perhaps your landlord would be happy to help you out!

HOW TO BUY WITH NO MONEY DOWN

There are a few variations that can be used depending on you and your seller. Do they want the market price or are they just eager to get out from the monthly payments - perhaps facing foreclosure?

The simplest method is to take over their mortgage payments - called 'assuming' the mortgage. You will need to be approved by the original lender to assume the mortgage. If you cannot get approved for an assumable mortgage you may also try a 'subject to' assumption where you merely make payments while the property remains in the seller's name.

WHAT IF THEY WANT A HIGHER PRICE?

You take over the original mortgage AND create a second mortgage on the remaining cost of the house with the seller. Offer a high, interest-only payment for a short period of time - 2 or 3 years. Instead of having the money sit in a bank they can be collecting a high interest over 2 or 3 years with the remainder due in full at the end of the term.

When the term ends you should be able to refinance the cost, or you can sell. Unless you hit a real bad market the value of the property should have risen in that time.

WHAT IF THERE'S NO MORTGAGE TO ASSUME?

Easy. Most mortgage lenders merely want to make a good investment. While your local bank may still shy away there are plenty of financial lenders that would love to make a deal.

Financiers like real estate. The mortgage is usually based on 60-70% of the VALUE of the property, so as long as they know they get their money back in the value of the property if you default, they don't care what kind of money you make. Complete the deal with a second mortgage created with the seller. If you default they can still foreclose on the property and sell it, paying off the existing mortgage with the proceeds.

As you can see, it can be in the favor of a buyer and seller to work together - especially if the seller is motivated. If they can't wait for a sale, you can still give them their asking price with a little flexibility on their part.

Real Estate Directory