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Getting Started in Real Estate With Little or No Money

By Andrew John Cocks | Check Real Estate

Getting Started in Real Estate With Little or No Money

Article by Attorney William Bronchick

You’ve seen the late-night infomercials with self-anointed gurus promising you millions in real estate profits with no money down. The truth is that many of these charlatans never made a dime in real estate, but instead built their fortunes through selling over-priced or useless information to unsophisticated investors suffering from insomnia.

Most of us are smart enough to realize that no real estate “system” is foolproof, and if anything seems too be good to be true, it probably is. However, that doesn’t mean that you need excellent credit and a surplus of cash to get started in real estate. Here are some strategies for financially-constrained aspiring investors to begin generating real estate cash flow.

You Don’t Have to Own a Property to Make Money From It – Be a Dealer

There are two types of quick-sale real estate investors – retailers and dealers. Retailers buy properties outright and sell them for a quick profit. Their risk is highest, but so is their potential reward. Contrary to the late-night realty televangelists, retailers typically need substantial cash for a down payment, and at least decent credit.

Dealers, by contrast, buy and sell contracts, not properties. They find bargain properties and sign purchase contracts with their sellers. Dealers then sell these purchase contracts to retailers, making a solid profit in the process. This is known as “assignment of contract.” Usually, the only cash required is the earnest money to secure the deal. A good dealer can then flip the contract for a quick $ 1,000 to $ 3,000 without ever taking possession of the deed.

Use a Double Closing for Greater Profit Potential

A double closing allows a dealer to earn a higher profit margin than an assignment of contract. With an assignment of contract, there is always potential that the deal will ultimately fall through. The dealer is protected in this case because she has already received her proceeds from the sale of the contract, but the retailer who buys the contract from her is wary of the deal falling through, and thus, will factor it into the price he is willing to pay. With a double closing, the dealer assumes more risk, because if the deal falls through, she receives nothing. However, with this greater risk comes a greater reward.

A double closing begins with the dealer signing a purchase contract with the property owner. Then the dealer signs a contract with the retailer, in which the retailer agrees to buy the property from the dealer at a higher price, and deposits that amount in escrow. The property owner signs the deed to the dealer, who then signs it to the retailer. The retailer then signs the loan documents, and the process is complete – the property owner is paid his asking price, and the dealer is paid the difference. Note that the dealer came to the table with no money, and her credit was never an issue.

Be a Scout – No Cash or Credit Required

In addition to dealers and retailers, scouts are a third type of real estate “flipper.” Instead of flipping actual properties or contracts, scouts flip information.

Scouts face even less risk than dealers, and have almost no cash or credit concerns. They simply gather information about distressed properties and sell it to interested dealers and retailers. In effect, scouts do the dirty work for real estate investors, and investors are willing to pay them handsomely for doing it. Typically a scout will gather the following data on a potential deal: The owner’s name and contact information, the asking price, information about the mortgage and whether payments are current, outstanding liens on the property, a photograph of the house, and pertinent information about the owner’s motivation to sell – i.e. is he in the middle of a divorce, foreclosure, job transfer, etc.

Investors typically pay scouts between $ 500 and $ 1,000 for good information, but what happens if an investor doesn’t pay? Simple – don’t take any more deals to them. Successful investors realize the value of good information, and they are more than willing to pay for it.

Take Over the Seller’s Mortgage Payments

Prior to 1989, almost all home loans were freely assumable. This meant that anyone could take over the payment of the loans without objection from the lender. However, due to a climate of rising interest rates that began in the late eighties, virtually all home loans issued since then contain a “due-on-sale” clause. This means that when ownership of a property is transferred, the lender can demand payment, in-full, of the outstanding loan.

However, “due-on-sale” is merely a clause – not a law. It is the lender’s prerogative as to whether or not this clause is exercised. If you buy a property and take over the loan payments, there is a distinct possibility that the lender won’t even notice. There’s an even greater chance that the lender will choose not to exercise the due-on-sale clause, so long as you make timely payments. After all, the cost of enforcing the clause is significant, and as long as the lender is being paid, it is unlikely to care who signs the monthly checks. Armed with this knowledge, you can potentially buy properties without a credit check.

Real Estate Success Always Requires an Investment

There are ways to profit from real estate without significant financial investment, however, that is not to say that success comes free and easy. At the very least, you will need to make a substantial investment in yourself. In order to succeed, you must be willing to work hard. Even with a million dollar real estate portfolio, your brain will always be your #1 asset. Be sure to invest in your education on a daily basis, and learn as much as possible about your local market, real estate law, and investment strategies.

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Written exclusively for Legalwiz.com by Attorney William Bronchick, Certified Registered Nationally-known attorney, Author, Entrepreneur and Speaker.

Written exclusively for Legalwiz.com by Attorney William Bronchick, Certified Registered Nationally-known attorney, Author, Entrepreneur and Speaker.

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Option which allows investors to pay the money and profits House Real Estate

By Andrew John Cocks | Waterfront Real Estate Ontario

Option which allows investors to pay the money and profits House Real Estate

Article by Nick Evans

Following the recent housing market crisis and the subsequent economic downturn, many investors shied away from most real investments. Although there have been many who meet income during the recent crisis, and with some of the tools, now the average individual, as well as almost anyone can do it.

Advantages that only have access to the Internet can bring the estate market is astounding, opportunities, ranging from international properties for rent in the residential home. Various discounts and incentives that can be used on both sides of the transaction led many investors to pay cash for houses, to some extent the lowest interest rates ever seen, and the acquisition of properties, the lowest price in recent history.

Modern Estate Market

Modern estate market can be fast-paced market, or an average of slow and steady, depending on the level of investment and type. Today, investors’ access to instant alerts of new features for the interest, access to the database listings, estate agents, and one of the most important investment tools to investors in a few decades ago did not, online. World Wide Web use to find properties, evaluate the different values and interest rates, or simply to see the real without having to physically visit just a few of the ways the Internet has increased the real estate market, the average individual.

Make enough off of real estate companies to finally pay for the house and move them quickly, for a long time it was just wishful thinking of most, but it is now, with a little work and some education market and the particular advantages of the reality of time. But jumping to the right looking for Waterfront property, sold in Ontario or Malibu Beach House is not the best idea, there are some very good business now, and most likely when there are close to where you are. With so many accredited and lost jobs, the banks were left with a lot of commercial and residential premises for some time, and at all times the property was depreciating the value of sales. It really makes for good rates and easy financing in most cases, also significantly reduced the overall cost.

Getting Started Real Estate Market

Journey into the real estate market is fairly easy to capital and credit, but consistent profits is another matter. For those who are new to the market, professional guidelines have, and a professional agent or broker services are worth, but fees may be included to learn from the experiences of others in return. Professional guidance not only helps reduce the risk, it also gives investors the opportunity to get a real inside information and advice from those who worked in the market for some time.

In addition to the professional background of training and continuing education guidelines for priorities. Understanding, and to remain current with the latest technologies and trends, not only can help you profit, but can also help you avoid serious losses.

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