Looking For An In To Real Estate Investing

Category: Finance, Real Estate.

Looking for an in to real estate investing?

After the futility of it all hits home, it s all you can do to limit the number of home business opportunities you investigate to twenty per week. Working a nine to five job swapping time for money can be incredibly dispiriting. One of the more compelling home business opportunities is real estate investing. You ve probably thought about investing in real state yourself but you ve not gone for it because you thought you needed tens of thousands in savings for a down payment, and perfect credit along with strong banking relationships. Real estate investing is the perennial wealth builder, and the transition from working a job to achieving wealth through real estate investing is becoming increasingly well documented. Well, you can get all that together if you want. But it s not necessary to have a huge pile of cash and perfect credit to buy a house cheap and resell it for a profit.

It doesn t hurt to have those resources. It s especially not necessary in the preforeclosure market. Where the bank has filed initial foreclosure papers but the sheriff sale or trustee sale where the bank auctions off the property, or repossesses it if no- one buys at the auction, hasn t occurred yet. Preforeclosures are houses in the default phase of foreclosure. Buying during the preforeclosure period is one of the best ways for anyone to get involved in real estate investing. So when you are negotiating with the seller, right up until, and the bank the point where you buy, no- one is making the payments.

With little more than a few hundred dollars and some specialized knowledge you can buy a house at a substantial discount and resell it retail picking up a five figure profit check in the process. : When people are in default on their mortgage they have stopped making payments to the bank. For novice investors worried about holding costs this is a huge advantage. One of the most deadly mistakes rookie investors make is trying to be a jack of all trades, going after any and everything they can lay their eyes on. Preforeclosures are a very well defined niche market. The result of this lack of focus is they are soon back at their jobs. One of the fundamentals of real estate investing is contacting and talking only to motivated sellers, and avoiding all the rest.

By being a very defined market, preforeclosures allow you to develop focused marketing campaigns and standardized processes to get deals completed and closed. Sellers in preforeclosure are some of the most motivated sellers you will find. By buying houses from people in preforeclosure, creating 30% + equity spreads on houses often in good condition is not a difficult thing to do. Their world has been turned upside- down, they are about to lose their house, and their motivation is such that they just want out of the house and the bank off their back. Buying houses in preforeclosure enables you to create unusually large equity spreads. If banks had to take back all of the properties that went into foreclosure the FDIC would shut them down.

Recent economic uncertainty has caused a lot of foreclosures, and rising rates will cause more in coming years. They know this, so they try not to take properties back they don t have to. This can t be done on loans not in default. By requesting the lender discount what is owed on their payoff, large spreads of equity can be created on houses that are totally maxed out with loans. Because lenders are under pressure to liquidate bad loans rather than take the property back, large discounts can be negotiated. If your plan is to buy and hold the property, having good enough credit and financials to get bank financing excludes a great many people from getting into real estate.

After becoming familiar with the issues that cause lenders to discount, larger and larger discounts can be achieved as you hone your negotiating skills. On top of that, if you do get a bank loan, your financial exposure is at it s maximum when everything is in your own name and personally guaranteed. No qualifying needed. Buying houses in preforeclosure allows you to simply take over the existing financing already in place. You can take title to the property in a land trust, begin making payments on the existing mortgage( s) , and still get all the tax advantages, depreciation without any, appreciation of the risk of being personally liable for the mortgage and the property. Lots of mind games.

If you have ever bid at auction for property at the courthouse steps, you are only too aware of the competition breathing down your neck. The 40 thieves are talking trash to you trying to get you not to bid. Make sure you have$ 500K on your credit line though. If you are Larry Bird, no problem. However if you are not the Bird and you don t pack half a mil of credit, you can sneak in and avoid this NBA showdown by buying the house during the preforeclosure period before the auction. But when you look at how easy preforeclosure makes it to buy houses cheap and resell for five figure profit checks, all the while helping people out of agonizing life circumstances, it makes little sense to pursue real estate investing any other way. Make no mistake about it, there are many ways to make healthy profits in real estate investing.

Read more...

I Want To Know How Much It Would Cost To Heat And Cool The Home Every Month - Finance and Real Estate Articles:

I m like most people. I enjoy being comfortable and content in a beautiful home, exquisitely decorated.

Buying A House Is A Long Drawn Process - Finance and Real Estate:

Buying a house is a long drawn process.

A Mortgage Loan Uses Property As Security For A Loan On The Property - Finance and Real Estate:

The first step to building wealth through real estate investing is to buy your own home. This way you not only are not only investing your payments in a property, you are able to take advantage of capital gains.