Believe the Hype- Real Estate Foreclosures are A Proven Winner for Real Estate Investors
Posted on February 7, 2009
Filed Under foreclosure investing, foreclosure short sales, foreclosure training, real estate foreclosure training, real estate investing, real estate investing training, real estate training, short sale training | Leave a Comment
By D.C. Fawcett, Business Building Coach to the Foreclosure Industry
When real estate investors evaluate their options for real estate foreclosures, there are several things that may come to mind. Whether it’s owning rental properties, fixing up properties in disrepair, or working short sales, the business of real estate foreclosures is a proven winner.
Where do most investors turn when they seek opportunities in real estate foreclosures? Sure, they might work with a realtor to find bank owned real estate foreclosures. There are thousands of bank owned foreclosures (or REO properties) on the market today and as such, this side of the business is highly lucrative.
Another option that is also very relevant to Real estate foreclosures is the short sale, where investors negotiate discounts on properties before they are foreclosed. This can also be highly lucrative and the key to success in Real estate foreclosures is proper training. Every state is unique and so too should be your training in learning how to successfully complete short sales and other real estate deals.
Despite the leads you can generate from foreclosure listings and the opportunities that exist with short sales, I think real estate foreclosures can be risky for the investor because, without the proper training, you run the risk of not really knowing what you are doing. Profits can be lost and so too can opportunities from real estate foreclosures, when you lack the proper training you need.
In today’s market, there are indeed unlimited deals to be found within the realm of real estate foreclosures. Whether you’re just curious how to make a little extra money with buying real estate foreclosures or really want to pursue a serious business, you owe it to yourself to seize the current opportunity that is real estate foreclosures and pursue it. Proper training can help make this happen!
In today’s real estate market, buying real estate foreclosures is as much as part of investing as any other part of the business. Make sure you have the right training backing you when pursue real estate foreclosures because the deals are out there. I highly recommend that you commit yourself to formal real estate training, and your pursuit of real estate foreclosures will be more productive and more rewarding. I wish you the very best in success in all of your investing pursuits and in business as a whole.
Finding, Fixing, Financing and Flipping - The Short Course
Posted on October 31, 2008
Filed Under real estate training | Leave a Comment
Most people get involved in Real Estate investing to make money.
Pretty self-evident - or, is it?
What would you say if I told you that everything you have been
taught about Real Estate investing and making money ‘rehabbing’
your real estate investments is wrong?
Well, at least, much of it. Let’s take a look at something that
all too many people don’t think about in their real estate
investing - something that seems to be a secret formula to
bringing in the most cash from your real estate investments.
While it is often true that the total price of a property that
has had a lot of work done on it is more than one that hasn’t,
what has that ‘price difference’ really cost you, the Real
Estate Investor?
With enough time and effort, we could go through dozens of
scenarios to figure out just what a loss of time, money and
effort it is to go through a house and ‘rehab’ it, but let’s
keep it short and talk about some things that really happen in
real estate investments - a ‘reality check’ if you will…
I like to be sure to get everything out of a real estate
investment that is possible, but, there is a balance between the
Time, Money, Effort and Appreciation the customer will get out
of what you put in, as opposed to what they would rather do
themselves…
And they are willing to pay you for the privilege!
I call this the ‘M-E-A-T’ of a real estate investing deal, and
it is a simple equation you can apply to all your real estate
investments.
In the table below, look at the M.E.A.T. result for each
Function.
____Function____ _M_ _E_ _A_ _T_ _Total_
Painting (full) _2_ _5_ _5_ _6_ __18__
Kitchen Redo _7_ _4_ _3_ _6_ __20__
Bath Redo _6_ _6_ _3_ _4_ __18__
Landscaping (full) _4_ _6_ _4_ _4_ __18__
Painting (LAZY) _1_ _2_ _4_ _3_ __10__
Landscaping (LAZY) _2_ _2_ _4_ _3_ __11__
You can see from these figures, the appreciation factor of the
customer is often the same - whether you put lots of time,
effort and money into this real estate investment or not.
The reasons for this are as varied as the people looking at any
given house, but how many times have you heard of people going
into a house - just after it was fully ‘rehabbed’ and they
turned right around and put the paint they liked throughout the
place?
So, why did you waste your M.E.A.T. on doing it yourself?
Because you thought it would be prettier?
That you would get more money from it?
Because you think that’s what real estate investing is all
about?
I challenge you to think about this - every time you get
involved in any real estate investment…
Just how much more M.E.A.T. did you really get from your real
estate investment - your total return? The cash you got was more
- maybe - but so was the WORK.
You can sell houses just like you get them - and get 90% or more
of the price you will after all that effort, even without ever
seeing the place!
When you use the LAZY way, you put very little extra into any
given real estate investment, but raise that return by another
5% (which means that it brings in almost the same total as you
get otherwise - without the added cost and work!
So, who makes more profit from their real estate investments?
Those that do less work! Plus, there’s more time, energy and
money available to put into the next real estate investment -
while those other folks are still remodeling their last deal!
In a year’s time, you can do 30-50 houses this way - by
yourself!
How many can you rehab in a year - by yourself?
Now, where is the bigger profit?
By now you can see just what I meant by the training you had
before being ‘wrong’…
You’ve been taught to ‘fix and flip’ your real estate
investments - but, unless you are doing the fixing directly at
the request of the end user, you are likely wasting your time,
money and effort for no additional appreciation factor, so,
overall, you are wasting it for nothing.
You are throwing away the M-E-A-T of the deal!
Just how much did painting that living room in your last real
estate investment cost you? Since you missed another deal that
might have $20,000, $30,000 or more in it, I would suggest you
spent a LOT on it!
Think about this before you start your next real estate
investing ‘rehab’ project - just how many other deals could you
do if you didn’t put all your time in on fixing? Then, add on
the energy (effort) that it saves you.
Most people think about the money part of real estate investing,
but leave out the rest of the equation when calculating the
total value of their real estate investments.
I think that is a big mistake.
When you can get 90% or more of the same price from any given
real estate investment, but do 1% or less of the work, keep 95%
of the energy for other projects and 95+% of the money it would
cost you - why would anyone want to do any ‘rehab’ job - ever -
in their real estate investing business?
Now, there may be times you find a house you want to live in
that needs some work. That is a fine time to consider doing a
‘rehab’ job - you aren’t doing a real estate investment (other
than for appreciation), but any time you are working your real
estate investment business, take a serious look at the M.E.A.T.
of the deal - before committing to spending all your time, money
and efforts.
Steve Majors - The Lazy Investor - Profit from Real Estate
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Foreclosure Investing - a Smart Strategy
Posted on October 29, 2008
Filed Under foreclosure investing | Leave a Comment
Foreclosure investing is a form of real estate investment. It is one of the best investment options as far as returns on investments are concerned. Foreclosure investment opportunities are normally created when homeowners default on monthly installment payments and the bank confiscates their property. The property is then sold at a foreclosure auction. Foreclosure investment opportunities are also available when a homeowner tries to sell the property directly to the ready buyers, before the foreclosure is announced. Information about such auctions is readily available on the Internet. You can use the information to invest in properties that have the potential to maximize your investment returns, in the next few years.
It is a buyer’s market
The foreclosure investment market is often called a buyer’s market because buyers are in a better position to negotiate the price of the property and other related terms and conditions in a deal. A homeowner, who has not made timely payment towards a mortgage loan, is usually aware of the fact that the property will be confiscated and he will not be able to profit from the sale proceeds. To avoid foreclosure, homeowners try to sell their property and use the proceeds for applying for new mortgage loans or buying new properties. Generally, owners who want to avoid the impending foreclosure have only 60 to 90 days to sell the property, before it is evaluated at a public trustee sale. According to certain state laws, homeowners are even given the option to reclaim their property within 360 days. Homeowners, who do not use this option, if available, will not be able to stop the lenders from foreclosing the properties and eventually selling them at a public auction.
Cheap and low risk investment option
Investing in foreclosure properties is probably the cheapest way of maximizing your investment returns. If you conduct a thorough research, you can easily identify and buy properties at very reasonable prices. In the past, there have been properties that were sold at discounts as high as sixty to eighty cents to a dollar. The foreclosure investment market is considered a low risk one, since land is a scarce resource. The value of the land will definitely rise, even if the real estate market witnesses a downtrend.
Other benefits
There is no dearth of foreclosure properties in the market. In order to buy a foreclosure property, you may not even have to apply for a bank loan. You just need to identify a suitable buyer, who is willing to pay the right price. Foreclosure properties are either sold at auctions or the buyer sells it directly.
As compared to the regular real estate market, the foreclosure properties market has a fewer investors. This makes it a lot easier to find and buy properties below the existent market rates. It is anticipated that the foreclosure properties market is set to grow at a steady pace in the next few years. The investment thus made is worth all the initial effort and patience applied. The foreclosure investment market offers real value on the money spent and re-evaluation of the property always reveals that the price paid was well below the existent market value.
For Agents And Brokers: Simple Guide To Selling Your Commercial Real Estate
Posted on October 29, 2008
Filed Under real estate investing training | Leave a Comment
If you are just starting out as a real estate agent, it can be difficult to get started selling commercial real estate. However, commercial real estate is the big money maker in the real estate business. Since commercial real estate has become quite popular since it is such a money maker, it can be difficult and expensive to get started in this type of real estate. There are, however, a variety of ways that you can get started and start getting more commercial real estate deals if you are willing to do a little work.
Online Free Ads
One great way that you can get started in selling commercial real estate as an agent is to use inexpensive methods of advertisement. One great way to get the word out there about the property you are trying to sell is to use free online ads. There are a variety of different websites that are available for you to post classified ads on that list a property, or even multiple properties for sale, and the great thing is, you will not have to pay a penny. Not only is this a cheap way of exposure, but it is also a quick way to get your property noticed. Many times, your ad will be seen quicker when you put it on the web and by many more people. Local newspapers take more time and money to get you the exposure and only reach a local group of people, while advertising with free online ads can get your world wide exposure and help you sell the commercial property.
Free Real Estate Publications
Another way that newer real estate agents can get their commercial properties noticed is to advertise them in free local real estate publications. Whether it is a publication specifically for real estate or a publication that only includes real estate, this is a great way to advertise your property for free. This is an excellent way to gain local exposure, not only for the commercial property you are trying to sell, but also for you as an agent. Make sure that you continue to run ads for your property in these types of publications. Even though at first you may not see results, remember that many times it takes awhile for commercial real estate to sell, but perseverance can lead to a large pay off when you finally sell the property.
Quality Signs
If you are trying to sell a commercial property, especially one that is near a well traveled road, you may want to invest in a quality sign to advertise the commercial property. A small unprofessional sign may not attract any attention at all, but a larger sign that is well crafted and attractive can get the attention of many people who are driving by. You never know who may drive by the property and see your sign. While it will take a bit of money to get a great sign, it will be worth the money that you spend to get your property noticed. One never knows when a local business will need a new site, or someone with money to invest will be looking for an opportunity, and your sign will make sure that they will see your property when they drive by, which may lead to a sale.
Establish Business Connections
As a new real estate agent, one of the best things that you can do is to start establishing business connections with a variety of different people. Speak with other real estate agents that are successful in selling commercial real estate and learn from their mistakes and their successes. Also try to get involved with local business people and know the market that you are trying to sell in. Often, if you can get the word out that you have a great piece of commercial property, it may spread to the right business people that will want to check it out. A great deal of being successful in the commercial real estate market has to do with the connections that you have, so work on making various business connections.
Find Your Own Leads
Even if you are working in a broker’s office, you should not expect the leads to be coming your way within the office. More than likely any leads within the office will be given to someone with more experience in commercial real estate until you have proven yourself to excel in this field. You will have to take the initiative to get the job done, and it is possible with a great deal of hard work. Check out the Chamber of Commerce in your area and find out who the business people are. You may also want to attend local zoning meetings where you will meet prospective investors who are looking for great properties. Even hitting up your local golf courses can help you make friends with local business people who may be prospective clients.
While it may be difficult to get started as an agent in commercial real estate, it is definitely possible if you are willing to work hard. Using the internet to advertise as well as free local publications can get the word out quickly and inexpensively so you will save money and get a broader base of exposure for what you are selling. Signs will also provide great exposure and show that you are serious about the commercial real estate business. Also important is making the right contacts and finding your own leads so you can excel in this business and prove to be a great commercial real estate agent. There is a great deal of money to be made in the commercial real estate industry, and hard work, dedication, and patience on your part can help you become successful.
Fraser Valley Real Estate Investment Strategies
Posted on October 29, 2008
Filed Under real estate foreclosures | Leave a Comment
To attain maximum financial benefits from your local Fraser Valley real estate investment with minimal risk and maximum gain, you must clearly define your goals and objectives and plan to achieve them. You can accomplish this in various steps. The process of determining your plan is comprised of several elements. First, Determine your current financial need. Then, assessing your future personal and financial needs brings you into your overall game plan for success.
Your success in real estate investments has a lot to do with the qualities that you bring to the table. Know your strengths and know your weaknesses so that you can focus on your strengths and compensate for you weaknesses. Are you considering group investments? Or a new home construction in Surrey, or Langley? This type of self annalist is crucial for success in this type of situation.
Complete a personal cost of living budget for the Fraser Valley and Greater Vancouver area. Your cost of living may be different if you are located in Richmond, Coquitlam, New West, Burnaby, Maple Ridge, Langley or Surrey. Your cost of living is generally more in those areas. However, it’s generally less expensive in Abbotsford, Mission and Chilliwack. After your living budget, calculate your personal net worth as a statement. Then calculate your gross debt service ratio and total debt service ratio. Keep in mind that these are only guidelines and that there are several creative ways to manage your finances. Talking to a financial money manager is sometimes a good source of structure and advice.
The amount of risk your willing to take should reflect the kind of time commitment your involved in. Be realistic with short, medium and long term goals and objectives. Maybe you want to be financially independent within 10-15 years. Write this down as a “need to be” statement. With that kind of time frame, don’t look at real estate as a “get rich quick” scheme. There are many who have adopted that attitude, this has been their downfall. Avoid the prophets of profit! Some real estate seminars will show you how to become rich through property tax sales in the Fraser Valley. Or foreclosure sales in the lower mainland. Some will show you how to flip property in the Greater Vancouver area but in most cases in Canada the reality of these options are not applicable. If they are, you will be undertaking considerable difficulty and risk when undertaking such investments. The key is to give yourself a realistic time frame to achieve your investment objectives. For example, normal real estate cycles are 5-8 years. Work within that time frame for your success. Be patient and stay positive! You will be successful!
Why An Internet Business is Better Than Real Estate Investing
Posted on October 29, 2008
Filed Under real estate investing | Leave a Comment
Want to work from home? There is a lot of ways to make money from a home based business. Two major sources of income are real estate investing and internet business. Both of them have their pros and cons but which is better?
Real estate offers huge payoffs to the creative investor who works hard. But that’s just the problem. In order to get paid with real estate you always have to be working. If you stop looking for properties and writing offers the money stops too. There is an exception if you have the luxury of buying large pieces of property and having someone else manage them. But for the rookie investor this isn’t an option.
So what are the experts doing? What are Robert Allen, Ron LaGrande, and Carlton Sheets doing with their expert knowledge? Let’s discuss what they aren’t doing. They aren’t scouring the newspaper looking for public notice foreclosures. They aren’t knocking doors making offers to desperate sellers. They aren’t sending form letters to out-of-state property owners. Do you know why they aren’t doing any of the things they know so much about? Because it requires too much work.
Instead of being knee deep in real estate they are making their money teaching people how to invest for themselves. They aren’t real estate investors anymore, they are information marketers. These experts moved from real estate investing to information marketing because there is easier money in selling information.
Selling information gives you many advantages over any other business model. The first advantage is that selling information has great margins. This means for every dollar you spend on expenses you can get 2, 3, or 10 dollars of return. They wrote their material one time and sell it over and over again. It doesn’t cost them any thing extra after they get the system up and going.
The easiest and fastest way to sell information is through the internet. Setting up an internet business requires very little risk and investment. Unlike real estate investing which requires a lot of personal risk. If one real estate deal falls apart you could lose your home or destroy your credit. If your internet business fails nothing major is at risk.
The chance of your internet business failing is a lot lower too. If you do your research and avoid spamming techniques there’s little that can destroy your little business. With real estate, on the other hand, there are hundreds of ways for a deal to fall to pieces. Things like shifts in market, unexpected expenses, and people flaking out can all cause your real estate investing to sour.
The real clincher for an internet business being better than real estate investing is this: passive income. Passive income is a powerful force. Your internet business will make you money while you sleep, while you’re on vacation, and while you’re doing other things. Some real estate investors will probably bring up rental properties. Isn’t that passive income? My wife’s parents have a lot of rental properties and they are always chasing down payments, fixing things, or paying the bills. It’s really not as passive as it first appears.
So, let’s leave real estate investing to people that don’t know better and do what real estate gurus are doing instead; selling information online.
Have You Considered Apprenticeship Training?
Posted on October 29, 2008
Filed Under real estate training | 3 Comments
What do George Washington, Benjamin Franklin and Paul Revere have in common? Apprenticeship training, of course!
Apprenticeship training is the oldest kind of job skills learning and has been used for centuries to train blacksmiths, silversmiths, printers and the like. In fact, Congress enacted the National Apprenticeship Act I n1937 to recognize the importance of apprenticeship in developing highly skilled workers in various trades. Apprenticeship is important in manufacturing, public utilities, fire, police, safety and of course in becoming a real estate mogul like Donald Trump!
Learning any highly skilled profession takes more than classroom training. You need hands on experience with someone who is an expert in the field. This is where an apprenticeship can give you what you need to excel at your profession. Apprenticeship fills in the gaps from books to real life and gives you a solid understanding of how a specific process works. Apprenticeship is one of the best ways to develop skills in any highly technical craft.
Apprenticeship usually consists of full time on the job experience where you learn how to do the job in the real world, Here, you will be working with a skilled trainer who will teach you the skills you need. One great benefit is that you get paid while you are learning. You can also take classroom training that are related to your desired occupation.
There are hundreds of different apprentice ship programs and indeed, these programs create some of the most highly-skilled, highly-paid individuals who work at their jobs anywhere in the world.
In the US, such programs are federally approved although each state oversees and administers the details of their programs. Once you complete an apprenticeship training program, you will get an apprenticeship certificate which is recognized nationwide. It is also the credential you will find the most useful and portable within most industries around the country.
Apprenticeship is for those that have a burning passion for their occupation as it is no easy road. Even before you can get start, you will need to have an application accepted and there could be a lengthy wait until an opening comes up for you. While a fantastic opportunity, this is not one to be pursued lightly. It requires commitment and dedication, so think about it carefully before you jump into an apprenticeship program.
Commercial Real Estate Desirability
Posted on October 27, 2008
Filed Under real estate investing training | Leave a Comment
For those who are looking for an excellent way to generate outside income, the commercial real estate industry is a great way to go. Many people have begun to invest in commercial real estate, and since this type of real estate is continually being purchased and sold, it has become an excellent way to invest money for a guaranteed return. Before one becomes involved in the commercial real estate market, it is highly important that they understand the commercial real estate industry and its many surrounding components.
A Basic Definition of Commercial Real Estate
First and foremost, it is imperative that one understands a basic definition of commercial real estate. Essentially, commercial real estate includes various real estate properties that have the potential to be able to generate outside revenue or even income for the owner. Whether the property has immediate potential for generating income or revenue immediately, or perhaps in the future, it can still be labeled as commercial real estate.
A Desirable Investment
Commercial real estate is an excellent choice for investors for a variety of different reasons. One of the main reasons that investors find commercial real estate to be such a pleasing investment is that is brings about both long term and short term financial benefits. In the short term, commercial real estate can help you bring in a better cash flow from the use of the property, and at the same time, in the long run the property will only appreciate in value, which will result in long term benefits should you choose to sell. Most investors also find that there is a lot less risk involved with commercial real estate than there is when dealing with other types of real estate. If you purchase apartment buildings or a strip mall, the risk of your investment will spread out among those who are renting from you, and even if you lose one of your renters, you still will be making money and seeing a return from your investment.
Commercial Real Estate Properties
Another positive benefit of commercial real estate is that the scope of properties that you can invest in is quite large. Commercial real estate includes various different properties that make excellent investments. As long as the building consists of more than four units, it can be considered a commercial real estate property. Commercial real estate also includes other properties such as strip malls, apartment buildings, RV parks, industrial parks, mobile home parks, and commercial centers.
Jobs within the Commercial Real Estate Industry
There are a variety of different jobs that are included within the commercial real estate industry, and all of them benefit from this excellent market. The investors have a very important job within the industry, since it is their money that is being used to make the property develop and become prosperous. Builders too have an important job, and many times they work within the commercial real estate industry to build new structures on commercial property such as apartment buildings or shopping malls. The lenders have a very important job, and they work to make sure that investors get the loans and mortgages they may need to be able to purchase commercial real estate properties. Also within the industry are the brokers who represent the owners and deal with the sales and property transfer issues. Last of all, but certainly not least, are the users who actually put the money in the investor’s pocket.
Financing Commercial Real Estate
Those who are planning on being involved in commercial real estate need to consider how they can finance any commercial real estate purchases. While few people can actually just purchase the property with money they already have, most people are going to be turning to other methods of financing the property. More than likely you are going to need to go to a lender to be able to finance any commercial real estate that you want to purchase, but there are a few things that you can do to make the process smother.
First of all, you will want to make sure that you have a business plan. You need to be able to show the lender why you want the property and how you plan on making it a successful investment. It is also important that you have at least a portion of the money needed for the property saved up so you can show that this is a serious venture and you are ready to make a personal investment in its success. Also helpful is a current appraisal of the property you are considering. This will help show the value of the property to the prospective lender. Having an attorney to help you and to check out legal issues will also be important, and in the end you should always compare several lending offers before making a final decision.
Getting Started
For those who are interested in commercial real estate and the financial benefits that can be enjoyed, there are many ways to get a start in the business. One of the keys to getting started is to glean all the information about the business that you can, whether from reading books, searching the internet, or speaking with friends and business colleagues that may have experience in commercial real estate investing. Checking into the area you live in and getting a look at what kind of commercial real estate is available and what the prices are running can help you begin to get a closer look at the costs and the availability of commercial real estate in your area. Attending zoning and city planning meetings may also give you insights and ideas for getting started as well. Lastly, one of the best things you can do is to start building a network of friends and business acquaintances that already have their foot in the door of the commercial market. Learning from their successes and mistakes can help you on your way to becoming a successful commercial real estate investor.
Tips To Real Estate Foreclosure Investing
Posted on October 27, 2008
Filed Under real estate foreclosures | Leave a Comment
You’ve heard it a million times. If you were to get a property that is entering foreclosure, you can get a great deal on the price of the home or property. The main question is how do you acquire the necessary knowledge to get this property. There are a lot of loopholes when it comes to foreclosures, so it’s best to know as many of them as possible to prepare yourself for what can be a great and rewarding investment.
When deciding to invest in real estate foreclosure, it’s important to know where to find these properties and how to acquire the right information. You have to decide if you will invest in commercial properties or residential. Either case, you then need to gather information on any liens or other defaults that may be associated with the property. Depending on how you buy these properties, you may end up being responsible for the liens on the property.
Though not known by many, properties that are foreclosed upon are public knowledge. The list of foreclosed properties is available through your local county building. This will only include properties that are already foreclosed. You can usually access this list around the time they hold the auction for the current month. This will give you time to do the research necessary to be prepared for the next month’s auction.
If you want to purchase a property before it goes to public auction, that will take a little footwork on your part. There are websites that offer information on properties that are in pre-foreclosure. Be aware, the information on these sites is not always accurate. We had a property bought, remodeled, and getting ready to close; yet on the website we used to find it, it was still listed as in pre-foreclosure. It’s a good idea to call the lender and make sure that the property is in fact still in pre-foreclosure. If it is you will want to contact the property owner, explain who you are and your interest in their property. This may not start out as a pleasant conversation since the owner does not want to sell the property, yet when you explain to them that this will work in both of your interests, they may change their mind. In buying the property this way, the owner will not have to complete the foreclosure process which means that their credit score will not get a negative rating for this instance. They will pay off their mortgage and you will get the property at a dramatic discount.
Whether it’s pre-foreclosure or in foreclosure, it’s best to be informed about the property that you will attempt to purchase. You can do this by ordering a title search in which a company will research the records dating back a certain time period. This will bring up any liens or back taxes owed on the property. You may end up being responsible for these extra expenses. Therefore you must be aware of them so that you can bid fairly to cover all of the expenses, not just the mortgage owed. If you do not have the money and are willing to spend a little time at your local county building, you can do a search for these records yourself. You will need to visit the tax assessor’s office in order to determine if their taxes are paid in full or delinquent. You will also need to visit the recorder’s office and the county clerk’s office. In these two offices you will research liens on the properties in which money is owed. This type of information is the same that a title search will turn up and you will be able to do it for free.
Once you’ve acquired the information needed, it’s time to prepare yourself to bid a price for the property. If you are dealing directly with the homeowner, you have flexibility. You should have a good idea of what they owe to the bank and any liens at this point. You may want to offer them just enough to cover what they owe or slightly more. If negotiations are successful and you come to an agreement, you must be able to close the sale before the time of the auction. This is the only drawback to this type of sale. The monies owed must be paid before time of auction, otherwise the property is sold at auction, regardless of any agreement you may have entered with the homeowner. If you decide to purchase at auction, you must be prepared to pay the full amount of the agreed on price within a certain time period of being awarded the property.
After the auction or the agreed upon negotiation of the property, you will immediately be able to claim ownership of said property. If you have been negotiating and talking to the people that own said property, they are already expecting this and will probably have already moved out. Be aware, however, that if the owners refuse to leave the property, you may have to go through the eviction process that can take up to three months to complete. We recently decided to walk away from the award of a property at auction exactly for that reason. Our county will not send police to enforce the sale of the property. Therefore, in order to get the people to move out, the eviction process must be used. This wastes valuable time in which you could be fixing up the property and getting it ready for sale. This is one reason why, though it may be difficult, having communication with the property owners before the auction may save you a lot of headaches in the long run.
Once the property is legally yours, you are free to invest in it and make profit from it. It can be a wonderful way to work for yourself and make money while doing it. Our business has successfully invested in many properties and yours can too.
Getting Financing From Banks For Real Estate Investing
Posted on October 27, 2008
Filed Under real estate investing | 2 Comments
People investing in real estate look for capital providers, who will offer the level of capital they need as well as the rate, term, pricing, closing time frame, exit and prepayment options, and recourse provisions. These must suit their individual needs, as well as any value added features on the offer. Choose a capital provider with whom the individual can develop a good, long lasting, working relationship as well as providing the broadest access to the much-needed capital. Those who are experts in dealing with real estate investments are ideal capital providers. There are direct, indirect, and hybrid lenders that provide capital to real estate investors. Banks are direct lenders.
Dealing with Banks to Get Finances for Real Estate Investing
Banks are the most preferred capital providers as they have excellent staff and have expertise in the local real estate market. Most of the loans offered by banks are short term, full recourse loans that are not competitive by nature. Banks are acknowledged to be the best source for procuring capital needed for investing in real estate.
It is necessary to prove to the loan officer of the bank that your investment is a low risk one, by carefully presenting the application for the loan. All your achievements and your track record of good investment strategies will help in showing you are a low risk investment for the bank. Having a good credit profile as well as a good credit report are added advantages. Having a well-drafted business plan of how you are going to develop and implement the plan, including the cash flow forecasts in case you are in the construction sector, using an asset as collateral, and having confidence in your venture, will help in securing the loan at interest rates that are not too harsh. Select a bank that has expertise in your area of real estate as they may have value added services that can benefit you.
Developing a good relationship with the bank, making payments on time and repaying the loan will help, as they will be ready to finance you in future should there be a need for it. Having a good action plan to make your real estate investment pay good returns and a firm commitment to repay debts are what loan officers look for in any applicant. You can seek the help of the bank in planning your strategies and finding out if there is any means by which you can cut costs using the banks team of experts to guide you. When the bank is actively involved in planning, greater project profitability can be expected as well as aid in utilizing the borrowed money to get maximum results. Dealing with banks to get finances for real estate investing is an important aspect of this sector.
Additional Help
There are firms that offer help to new businesses investing in real estate. These firms offer services and software that shall aid you in the process of obtaining real estate and making money from it.
