investing in real estate

The Steps Needed To Invest In Foreclosed Homes

Over the past few years, millions have been made by knowing how to buy foreclosed homes. Buying a house in foreclosure can be a complex process, and to make money investing in foreclosed properties, you have to know the process completely. Getting into this form of real estate investing while uninformed can be a very risky proposition

After you better understand the steps in foreclosure, you should to take a look at your community and state laws that govern the purchasing and selling of foreclosed properties. Depending on the state in which you live, there may be limitation on how long you you are required to physically live in the home as part of the sale. Depending on your investment goals, these laws may place noteworthy barriers to your investment goals.

If the laws will allow and you feel you could profit from fixing and flipping foreclosures, the subsequently step is basically to locate a home that is in foreclosure. Your regional county posts a list each day, and if you don’t want to go down to the recorder’s department, there are a number of online services that do supply a daily list of auction foreclosures. Tap into as many of these tools as possible in order to stay informed on what homes may be coming up for auction that meet your investment profile.

Financing is a big part of buying real estate and this is especially true when buying foreclosed homes. Buying a foreclosed home from a court sale requires a extensive down payment, or more often, the full cash amount on purchase. As a result, you must have your financing in place before you buy the property.

Finally, if you have your financing in place, and have found a house that will meet your investment goals, the next steps are merely to bid and subsequently buy the foreclosed home. During the buying process be sure not to overbid for the home; at auction you may be contending with extra investors and it is very easy to bid yourself right out of your income.

Subsequent to you have closed on the house and it is yours to keep and run or rehab and repair, it is just a matter of getting to work. In summary, purchasing a foreclosed home is an uncomplicated process; you just need to know what you are doing.

For many individuals, finding a mi foreclosure can be a challenge. Visit us today to learn how to buy foreclosed homes and being making a profit in real estate.

investing in real estate

Real Estate Investing – Getting the Mindset

Most new real estate investors, all seem to have one critical element missing straight out of the gate when they start investing.What are they missing? The real estate investor’s mindset. Let’s break this down into a few simple things every new real estate investor needs to understand.

This is business, nothing personal. Having the real estate investor mindset means above all else, you understand that what you are doing is a business. That means you must look at this without the emotion that you have when buying real estate for your own personal use. This is not a home that you are necessarily buying for yourself. This is merely property that you are investing in to use to benefit your retirement, future nest egg. Or perhaps using it to develop financial resources to send your children to college.

Don’t make any emotional purchases. You are not looking for your dream home but an investment. Do not fall in love with any particular property. All of the purchases of real estate should be looked at from a bottom line perspective.

Shop as if you’re going to give the property to a family member. By shopping as if you were going to give this away to say your children as their first starter home, this means you need to evaluate a few things that will assist with the eventual sale of this investment.

Most new families are looking for real estate in locations that have good schools, good shopping, easy access to major freeways, low crime rates, as well as a plethora of other services and potential personal meets. Observe the surrounding areas of any potential purchase. Are the streets clean? Are the yards and the other homes well taken care of? Do you notice graffiti? These are things that you must factor into looking at future “curb appeal.” That will assist with the eventual sale of your invested property.

Educate yourself. Every good investor works on increasing his education. Not just of real estate transactions or real estate investing purchase options, but of the most important details involved in real estate investing. Those details simply understand what needs to happen to achieve a sellable product in the shortest amount of time in the most financially responsible way.

If you have no construction or contracting background, then you must have a concept or understanding roughly of what the remodel and/or repair costs may be per square foot for any investment property you are considering. If you are looking at an older home, what is the overall cost to do any update work? The cost to do any possible plumbing or replacement of electrical? What would it cost to replace the roof?

Now while this education may work or you may have the understanding of the costs in your immediate area. What happens if you invest outside of your immediate understanding and area? For example, will a handyman in Dallas Texas cost more or less than a handyman in San Francisco? For example, what are zoning laws from state to state for your type of property? What are the permits required to do a room addition in San Diego vs. a room addition in Oklahoma City?

The investor’s education is the most the important tool they have.

Real estate investing has always been a team sport. The largest investors in the country have dozens and dozens and dozens of people that work for them. Donald Trump has a staff that spreads into the hundreds of personnel.

No one that is serious about investing can do all of it alone. There are certain people that you must find and have on your team. Take everyone in on an initial trial basis. Use real estate agents; they will know the best deals/best properties available within your area. A good real estate agent is worth his weight in gold. Don’t try and arrange purchases on your ownespecially if you are considering a purchase out of your immediate local area of expertise.

You will need to find appraisers, groundskeepers, contractors, plumbers, electricians, and quite possibly a “handyman.” The reason for finding all of these various professionals is to have them on call should you find that property and have the available funds to pick up, hold, and refurbish/remodel the property and sell it. Understand that your relationship with these individuals is as critical if not more so than finding the property yourself.

Interested in learning more? Get more valuable Real Estate Investment Information at Invest in Real Estate. Free reprint available from: Real Estate Investing – Getting the Mindset.

investing in real estate

Investing In Short Sales

Those real estate investors with capital in today’s market are taking advantage of homes in preforeclosure and buying real estate through short sales. Investors familiar with short sales know the benefit of being able to buy a property at fire sale prices. For investors looking to get into purchasing short sales, the return can be phenomenal.

With this in mind, how does one go about buying a short sale property? To get started, you must comprehend that a short sell is simply buying a property for less than the mortgage value. Obviously, there will be parties that benefit from a short sale and those that will actually lose money. However, you will be dealing with a bank that is trying to reduce their loss so there will be a lot of paperwork that will need to be completed. Because of this, a enormous deal of patience is needed through the buying process

While going through the short sale process, you must be aware of how each participant will act through the process Obviously the property owner is a big factor in the transaction and may be going through some financial turmoil which is leading to the need for a short sale. Before even beginning the short sale process, be sure that the property owner is willing to complete the transaction and understands the implications.

Be sure that you get the property owners approval, but you will need to contact the loss mitigation department of the institution in order to start the process. As a financial institution, a bank will only agree to let an investment or mortgage go if the cost of owning it is going to be greater than the payoff. For most institutions, they will only agree to a short sale if the property is at risk of foreclosure. Because that is a guiding principle, you must create a circumstance where the institution sees the short sale as the best option.

Now that you appreciate the motivations of the two players, purchasing a short sale is just a matter of satisfying their two unique needs. Develop a short sale offer with the help of the property owner. Include a letter from them explaining their incapacity to continue to pay on the mortgage as well all additional substantiation. Document and photograph all areas of the property that are in disrepair, and get an appraiser to come out and give an appraisal based upon the lowest marketable value of the home.

The next step is just offering to purchase the property at a given price and submitting it to the institution for approval. Submit your purchase offer along with the short sale package to the bank and gently push it through the approval process. It the proposal is approved, your purchase of the short sale goes through. If not, just modify your proposition and submit it again.

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categories: short sales,preforeclosure,foreclosure,real estate,loss mitigation,investment property,investing in real estate,short sale

investing in real estate

Creative Ways to Make More Money in Real Estate Investing

SUBJECT TO: Subject-to investing means that you are buying a home “subject to” the existing financing. You get the deed to the home but the original owner keeps the mortgage in their name. You take over payments of the mortgage and ultimately sell the deed to someone else.

WHOLESALING: This is where you buy a home inexpensively and then sell it to another real estate investor. You might not make as much as if you fixed up the home and sold it to a consumer but you can flip houses quickly this way.

REHABBING: This is the well-known (and well-televised) strategy of buying an inexpensive home and fixing it up to resell it to someone else. There is some time and money involved in the restoration process but you can dramatically increase the value of your investment.

LANDLORDING: A well-known strategy to buy property and then rent it out to someone else. Although there are headaches with this strategy, you get an ongoing stream of monthly income as well as the appreciated value of the property over the years.

There are other types of real estate investing but these are among the most popular and lucrative and investors are making thousands on these methods right now.

There are many more strategies for investing in real estate, especially in today’s unstable market. You can go to my website where I hold training with the Experts of Real Estate every week and sign up for FREE! Just go to www.investingwiththestars.net/season3 and enter you name and primary email address and you will see all the speakers I have lined up to teach all the newest strategies. You will reall get a lot out of these trainings and pick up some great tips you can use right away.

Nancy Geils
Investing with the Stars

Want to find out more about how to invest in real estate like the experts do and claim your free 5 week mini-course on tips and strategies. Go Now toreal estate investing, then visit Nancy Geils’s site on how to sign up for FREE Trainings on RE Investing making money with real estate for your education.

categories: real estate investing, easy real estate investing, real estate, REOs, finding real estate properties, short sales, foreclosures, preforeclosures, HUD, investing in real estate, alan cowgill, carelton sheets

investing in real estate

Making Money On Shortsales

Short sales are not new. Lenders have been doing them for years. However, due to the increase in mortgage delinquency due to our current economic situation, the lenders are now inundated with request for short sales. Bank of America, Chase and Wells Fargo are lenders who have been very slow in their response to short sale request. Chase has indicated that they are still working on request made in June, 2009 and we are now closing in on November, 2009. The original timeframe of 60-90 days is now 90-180 days at minimum. The smaller lenders work more quickly.

Shortsale: What is it?

If you own real property and you owe more on your mortgage then the home would appraise for and you have a hardship, then you may be able to short sale your property. A short sale is when the lender is willing to accept less than the full amount you owe.

In order for your lender to consider this option the following must apply: Property must be listed with a realtor and must have a contract based on the comparables in the area the property is located. Owner must have a financial hardship. A financial hardship could occur from divorce, loss of job, pay cut, illness, accident. etc. Owner’s expenses exceed their income, this is considered a hardship. Expenses must be legitimate expenses. One cannot have a $500 dollar a month clothes shopping addiction. Real expenses including; electric, water, rent, insurance, car payments, gas, groceries, homeowner association dues, health insurance, etc.

Once a financial hardship has been established on behalf of the owner, These required documents that must be submitted to your lender: 1. Bank Statements – Last two months 2. Pay Stubs – Last two pay periods 3. Tax returns for 2008 and 2007 4. W’2s for 2008 and 2007 5. Financial Worksheet

The realtor will provide the following in order to submit to the lender: 1. Listing Agreement 2. Comparables ( active/pending/sold) 3. Listing History 4. Contract offer ( The accepted sales price, should be on or around the current market value) If the contract offer is not acceptable, then the agents should leave the short sale addendum un marked on #5, to allow additional offers to be submitted. But if the original offer submitted is sufficient, this clause should be eliminated.

The following will be provided by the Title company: 1. Title search 2. Preliminary Hud 3. Complete Lien search, including: Code Enforcement, Open Permit and Water balance search.

We highly recommend that a title search and lien search be completed on the property being sold in order to make sure that there are no judgments, liens other than the existing first or second mortgage. If a title search is not completed and a Preliminary HUD -1 Closing Statement is submitted to the lender, which does not reflect other items such as: Code Enforcement liens, Outstanding Water Balances, Open Permits, HOA Liens, Certified Judgments, delinquent real estate taxes, you can get your approval. However, once you have completed your title search and lien search and they show any of the items above, at that point you have to re-negotiate with the lender.

Important Items to consider regarding a short sale: Most lenders are not paying the entire amount owed fpr HOA assesments. They are comparing a short sale to a foreclosure in these cases. If a lender proceeds to the foreclosure sale, the lender is, under law, only required to pay a certain portion of the back assessments. This is the rule of thumb to go by, if the property is a condominium, the lender will pay up to 6 months in back assessments, if the property is a single family home, then the lender will pay up to 1 % of the original balance of their mortgage or 12 months of back assessments. Attorney fees are not considered, nor paid for by the lender. In most cases, the HOA will reduce the amount owed to them. However, some HOA’s are taking a stance that they will not accept what the lender is offering and they will kill the deal. Most lenders will only accept individual buyers. Most lenders do not allow; Corporations, LLC, LLP, Land Trust, Trust etc. The property must be purchased by an individual person(s). Not all companies who say they can negotiate a short sale are qualified to do so. Negotiating a short sale or even a loan modification requires a background and experience in mortgage, title and real estate. Most short sale negotiators who have a background in title insurance, mortgage, or even real estate have a better idea of the entire process and what is involved in all areas of the short sale transaction. Lenders do not have to approve a short sale, even if there is a hardship; however, most lenders are trying to accommodate the owner to some degree. Lenders will definitely deny owners short sale if they feel there is not a legitimate hardship. Second Mortgage Lenders are asking for 10% of the principal balance.

GETTING THE SHORT SALE APPROVAL LETTER FROM THE LENDER IS THE EASY PART. PUTTING ALL THE PIECES OF THE PUZZLE TOGETHER: PRICELESS!

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categories: Real Estate,Shortsale,Florida Shortsale,Jupiter Florida Shortsale,Shortsale assistance,Foreclosure avoidance,Avoid foreclosure,Shortsale,high end shortsale,shortsale realtors,Real Estate Investing,Investing in Real Estate,Investing in short sales

investing in real estate

Is Investing In Real Estate Right For You?

A depressing fact only 5% of Americans will be able to have the funds for retirement. For the overwhelming rest of us, the prospect can be pretty intimidating. Conversely, with precise preparation and a essential comprehension of investing, you can certainly join that 5%, even if you don’t make that much money every year.

Investing in real estate could be a good way to become a member that 5%. I realize that this is not a fashionable outlook right now given the position of the market. Regardless, investing in real estate has made countless millionaires throughout history. In addition, investing in real estate provides significant benefits over other investments These specifics are especially true in a down market because you as an investor have the chance to buy property at a low cost that ought to appreciate over time.

With these facts in mind, what are the primary steps to begin investing in real estate? The primary thing you must know is that there are three areas to focus on when buying an investment property. The first of which is rent which will fund the mortgage expenditure. The next is the general appreciation over time. The third is the savings on your taxes by owning the property. When you look at a potential investment property these are the primary issues that you need to address.

There are countless real estate investment software products on the market, and a few of these real estate software packages are complimentary for investors to download.

As a novice in real estate investing, you might not wholly comprehend all of the ratios and data that a retail or complimentary real estate investment software program offers, the data provided by the program is still necessary to guide you on your decision. For most software programs the basic data is relatively easy to recognize and will allow you to get a feel for if the rent will cover the cost of the investment and if the investment property will truly be profitable. The more in-depth data returned from the real estate software possibly will be better understood by bankers and accountants. Nonetheless, these are professionals that you ought to come to know as you commence investing in real estate.

Real estate investors that would like to get their own copy of the IP Ware Free Real Estate Investment Software, visit freetrainer.com. Freetrainer.com and GRAR provide tools to help real estate investors profit and succeed.

categories: real estate,investing in real estate,real estate software,real estate investment software,investment property,software,investment analysis,return on investment

investing in real estate

Cheap Houses Are Cheap – But Are They Really Bargains?

I had to go to the grocery store on Saturday afternoon to pick up some basic items. You know, bread, milk, tomatoes, etc. Our favorite local store is closed on Sundays so on Saturday they normally mark down some perishable items with huge discounts. It’s extremely tempting to snatch up some of these cheap items unless one realizes that there’s a good reason the price is reduced.

That discounted loaf of bread has already reached its “sell by” date. Before we can use the whole loaf it will most likely become moldy and we’ll have to toss half of it. That gallon of milk is also about to expire; by the time we get through half of it, the milk will probably sour. And that shrink-wrapped package of six tomatoes? They’re already getting soft – how fresh will they be in 2 or 3 days? Ugh!

There are times when cheap really is “cheap” (as in cheesy). The property market can be very much like the grocery market – there’s always a reason that a bargain is priced well below the normal market value. Discovering why a cheap property is heavily discounted is critical. Without additional information it is impossible to determine if it is really in your best interest to pursue. Seeking the advice of a well qualified buyer’s agent is a very wise move to make before jumping on a cheap home.

The reasons that homes are listed at bargain prices can generally be classified in just a few categories:

1. The “Fixer-Upper”

Many homes that have fallen into disrepair can be purchased at prices well below the local market price of well maintained properties. If the current property owner is unwilling or unable to make necessary repairs their only option would be to offer it for sale at a bargain price.

If the prospect of investing “sweat equity” (i.e. manual labor) is particularly unappealing, you may want to avoid this type of cheap home. Likewise, if paying someone else to perform the necessary repairs is out of the question – walk away. However, If the prospect of doing the work yourself doesn’t make you uneasy, these fixer uppers can be an excellent choice.

2. A Less Than Desirable Neighborhood

We’ve all heard the saying that the three most important aspects of real estate are location, location, location. Well, it’s really true. The value of a home can vary quite a bit depending upon its neighborhood. This can be fabulous for the homeowner in an upscale location. However, it can be devastating for a homeowner in a neighborhood that has fallen on hard times. Contrary to many people’s beliefs, real estate values do not always increase with time.

In some cities, certain neighborhoods that have been on the decline are gradually being revitalized through the renovation of individual homes. As these renovations spread, the potential value of property in the immediate neighborhood can begin to climb. Your Realtor will be able to give you an idea about the direction that prices are moving so that you can make a well-informed decision about the potential value of inexpensive homes that fit this category.

3. “Priced to Sell Quickly”

Circumstances may arise when a homeowner is under pressure for a speedy sale. The seller may need to liquidate assets for immediate cash in hand. He may be facing a deadline relocate for employment purposes, or he may need to stop paying double mortgage payments if he has already committed to purchase another home.

Inexpensive homes in this category usually provide the best value. However, these bargains do not normally remain on the market very long since a fast sale is the very reason that the property was discounted. The best approach to finding these fleeting opportunities as they arise is to have your buyer’s agent notify you when new property listings hit the market. Most real estate agents have access to automation tools that will automatically notify you via email the same day that a property that meets your requirements is put up for sale. Without that type of competitive edge, it’s likely that you’ll never hear bout these prime opportunities.

4. The Challenge of the Unknown

This is the “catch-all” category for homes that don’t seem to fit any of the three previous categories. They are the riskiest properties and should be approached with extreme caution. There is always a reason for a house being under priced – if it’s not apparent at first glance you may have to do some serious investigating before considering a purchase. Sellers are obligated by law to disclose any information that affects the home’s value. Your buyer’s agent will prove invaluable in these cases by helping you ask the right questions.

Obtaining the advice of a buyer’s agent and investigating the reasons that “bargain” properties are priced so low are the keys to discovering the true value of a “cheap” home. These deals can look very attractive at first but, only after further evaluation, will you have an idea if a property may turn out to be a “money pit” or a fabulous opportunity. You won’t regret performing your due diligence.

Jim Navary has been a researcher and freelance writer for more than thirty-five years covering a wide range of topics. He is also a licensed real estate salesperson in the Commonwealth of Virginia specializing in Fort Lee VA real estate and Colonial Heights VA homes for sale.

categories: cheap property,cheap homes,buying a home,buying property,inexpensive home,inexpensive property,real estate investing,purchasing a home,purchasing property,real estate,investing in real estate,buying a house

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