Posts filed under 'Investing'
Many of the so called real estate “gurus” out there preach the value of using OPM (other people’s money). They say it’s best to use other people’s money to defer risk, but really it’s because they want people without money to invest in real estate. If you’re not confident in your real estate investment enough to be using your own money, then you probably shouldn’t be taking that investment option. But that’s a subject for another day, this article is focused on hard money.
Privately funded, high interest, high fee real estate loans are known as hard money. These loans aren’t called hard because they’re diffucult to get, what they are is hard to pay off. It’s not cheap to get hard money financing. They usually have an upfront origination fee of 3 to 4 points, plus double digit interest.
One of the major differences with hard money lending, and other types of financing is the criteria used to determine finance risk. The focus on traditional mortgage loans is the borrower. The lender will only loan money if the borrower has a good credit score, a low debt to income ratio, and a consistent stream of income in which they will be able to pay for the debt. The focus of hard money lenders is the property’s lending worthiness or value. If the property is worth more than the amount to be borrowed, hard money lenders will likely provide the funds. If the borrower happens to default, the hard money lender doesn’t have a problem foreclosing on a property with substantial equity.
Hard money loans can be useful, and can be very valuable for investing in real estate. Many foreclosure auction and other deals need financing very fast. They must aquire loan money quickly. A good Virginia hard money loan can be obtained within just a few days. If the property is a good investment, and there’s a solid exit strategy, then even though the borrowing cost may be high, the profit made is worth the cost. The important factor is the net profit, not the costs spent.
If an investor borrowed $100,000 from a hard money lender at 20% interest, and sold it three months later for $140,000. The upfront fee was $3,000, or 3 points. They may have paid the hard money lender $9,000, but they still would have a profit of over $30,000.
Hard money lenders can be the medium for making good real estate flips, but it should only be used by savvy real estate investors.
August 20th, 2010
The idea of a property club is there is strength in numbers. It is a place where ideas and strategies for property investing can be discussed and shared. No mater where you are there is a plethora of real estate courses and advice about what is the best strategy, however to access this you need to find over many hundreds if not thousands of dollars,. This does not need to be the case. There is enough knowledge and experience out there that should be freely available to the people looking to search for it.
Also because there is much information out there no one person can do it all or read it all. That’s why a property club can pull the resources of all the experts and people that have been there and done that to share their experiences.This ranges from how to value a property, what tax concessions are available and so on. Although it is very important to get your own legal and tax advice there is no reason why you cannot be educated with the fundamentals so you can ask educated questions to your professional advisory team. This ensures that you save time in terms of getting what you want when spending time with your advisors and also know that they are doing the right things for you so your strategy is aligned with your goals and everyone is on the same page.
As an advanced strategy it can also act as buyers groups to leverage buying power from vendors and developers to negotiate a wholesale purchase of a particular property site. This can be very effective, however needs to be organised so that all parties are aware of their obligations and there is full disclosure of the negations. A community of like minded people can be very instrumental in accelerating your knowledge and investment strategies for your future success
August 8th, 2010
Sometimes a question is asked as to why people buy another property. The good thing is an investment property can give you a great retirement income. Even just buying a few extra properties over time can grow you with a attractive retirement fund in ten or so years time.
Take a look at this illustration. Many folk own one home which they live in and they pay the mortgage on it. Other bills will have to be paid such as council tax and utility bills too. The homeowner will need to work to keep on top of the bills and keep up with the mortgage payments. Income tax also needs to be paid from your job which also eats into your income. With the bills and your income tax can at times equal 2/3rds of your wages. Leaving just a third of your wage left to spend.
Most individuals are just pleased to pay off their own mortgage and own their own home. Although that does not resolve the trouble of paying for the rest of the bills such as gas and electricity and your own existing cost. So the same scenario remains, you have to maintain working to pay the bills.
The idea is to have houses bringing you in money instead. This source will continually bring you in an income, so you will have money coming in all the time. This is why having income producing properties is important. The income property can still be mortgaged and you can still make money from increased rents.
As the years go on, your properties will increase in value and your rents should increase too. Once you have paid off the repayment mortgages, you will own the home outright. The cash earned from these properties should be sufficient to pay all your utility bills and give you a lavish liifestyle
Another reason to use income producing houses for income is that you don’t physically have to be around to run them. You can use agents to run it for you and other work men to do the maintenance. This means the money can roll in while you are not there. I am capable of being in some accommodation in Barbados and still earn money. You could also be staying in a hotel in Barbados while your properties earn you cash.
July 7th, 2010
Every successful real estate investor knows they need to find motivated sellers, but they also know they need a steady flow of good leads to find those motivated sellers. So to find the really motivated sellers, you need a solid lead generation system that will continually flood your business with motivated sellers! Getting the best leads is what really makes you truck loads of cash! It doesn’t matter how well you structure deals if you can’t find motivated sellers,” right? Isn’t that what people call, Putting the cart before the horse?” Why waste your time and money trying to buy properties from a less than motivated seller?
If you want to get a steady stream of leads into your business you should consider the REIM complete package by Steve Berchtold. This package is composed of :
-FIVE NEW LETTER CATEGORIES PLUS ALL THE ORIGINAL REIM LETTER SERIES MARKETING LETTER TEMPLATES: Probate Letters, Bankruptcy Letters, Buyers Letters (Marketing to Renters), Commercial Letters and Divorce Letters. With the already existing letters in the REIM Letter Series this completes the package. (Pre-Foreclosure Letters, Occupational/Re-Location Letters, FSBO Letters, Out Of State Owner Letters, Subdivision Letters, Zip Code Farming Letters, Distressed Property Letters and Stressed Out Landlord Letters (All Original letters are included in this package as well)
-TWO COMPLETE AUTORESPONDER CAMPAIGNS for your Buyers and Sellers list email marketing. Keeping in constant contact with your potential sellers will keep you from losing out on those cash rich deals! To seperate you from all the we buy houses guys you should build a relationship with potential sellers or buyers!
-FREE REPORTS for your Buyer and Seller website traffic. Your website visitors will be much more willing to fill in their personal information when you offer them a FREE report about a topic they’re interested in knowing about. It also gives you credibility that you’re a “go to person” who really can help them with their real estate problem.
-ULTRA REIM LIBRARY Is A Selection of Six eBooks written by some of the most well known people in real estate investing. They’ve helped thousands of the most successful property investing enthusiats find out the tips and tricks of how to make big cash every day in real estate investing.
-How To Create Multiple Streams of Income
-Internet Marketing For Creative Real Estate Investors
-Investors 12 Deadly Mistakes
-Marketing Strategies
-Nine Steps To Improve Your Closing Ratios
-Rich Dad Poor Dad (Classic By Robert Kiyosaki)
-THE PRIVATE MONEY SALES TOOL Is a great tool for giving your potential private money lenders, providing them solid information on how much they’ll make if they work with you funding your deals and how well you know the business! More credibility will be given to you as a real estate investor.
Real Estate Investors all over the country are making deals and making a truckload of money! The opportunity has never been better! Houses and the current inventory may not stay at this level for ever… Don’t cheat yourself out of all the money you could be making right now! The smart real estate investors are making a boatload of money. Why shouldn’t you cash in on all the great deals too? The REIM COMPLETE PACKAGE will help make it quicker and easier for you to start getting cash rich deals!
June 30th, 2010
There are a lot of people on the internet selling trading systems these days. In fact it is becoming increasing difficult to seperate the good from the bad.
The marketing done by some of these sellers is top notch. They say they can teach you how to day trade and trade for a living.
It is important to know that more traders lose money day trading than not.
Some are excellent trainers and many. are just trying to sell something they read in a trading book.
So how do you seperate the two?
The very first thing is to talk to the trainer. This may sound strange but many of those selling trading systems or methods are impossible to get on the phone. If this is the case, move on and look somewhere else.
When you do actually speak to the person or persons doing the training the first question to ask is “Do you trade for a living or do you just train?” You will be stunned at some of the song and dance answers you may hear~” You will be stunned at some of the song and dance answers you will get~” You may be amazed at some of the song and dance answers you will get~” You will be amazed at the song and dance answers you will get~” You may be amazed at the song and dance answers you will get~” You will be amazed at some of the song and dance responses you will get~” You will be amazed at some of the crazy answers you will get~” You will be amazed at some of the crazy responses you will get~” You will be amazed at some of the song and dance answers you may get~” You will be amazed at some of the song and dance answers you may hear~” You will be stunned at some of the song and dance answers you may}.
Secondly, if they say yes, you will want to ask “Is the method or system being taught EXACTLY what you are doing?”
Those two questions alone will save you aggravation and thousands of dollars. There are so many people that have spent huge amounts of money on systems or methods, and even more that have lost bundles trying to trade these programs.
Some other questions to ask for are trading results, and for references that you can talk to. Don’t trust wriiten references as anyone could make these up.
Trading or day trading can be a very lucrative career for those that take the time to learn to trade correctly.
The wise, age old adage “A little knowledge is dangerous” is so true when it comes to day trading. Reading trading books is a good idea but being trained by a professional day trader will put a serious dent in the learning curve.
Remember seeking training is a wise idea but find the right training is the key to success.
May 22nd, 2010
A number of things likely come to mind when you think of virtual real estate investing. Depending on how familiar you are with real estate investing already, you might think of hard money lenders or real estate portfolios and real estate retirement plans, or you might focus on short sales, bulk reo investing and virtual real estate investing. You may also wonder what type of role these things can play in your life as a real estate investor in different types of economy.
You will need to know a lot about real estate investing. The best way to optimize your real estate investing education is to know the basics ahead of time. You will get the most out of anything to do with short sales, bulk reo sales, virtual real estate and just improving real estate investor abilities by knowing some real estate investing basics. You should review these three real estate investing basics to learn things even some experts do not know:
1. Real estate investing education always yields positive. In any real estate deal, there will be thousands of dollars in potential wealth. Understanding how to get that wealth will be the key to your success. Learning about real estate increases your odds of success when you do a real estate deal. Implementation of your small educational investments yields big results.
2. You have the ability to succeed in real estate investing in any economy. Often people think that you can only be a success in real estate when the economy is good. In fact a bad economy is not a bad economy for real estate investors. You can often find properties to buy at deep discounts. Also, you might find deals that simply could not exist in a booming economy. Poor economies can have the tide turned based on real estate investing. Short sales, bulk reo sales and virtual real estate all thrive when the economy is less than thriving. You can save yourself from financial difficulty along with others by knowing how to do these deals.
3. You will not need lots of money to be a successful real estate investor. You can make a success of real estate investing no matter how much or little money you have. There are lots of deals that you can use other people’s money to do. Private lenders will lend you their money if they think you are a good investment. A person who is a solid investment knows as much as possible about real estate investing. This will help you show private lenders that you are a good investment if they do not know about real estate investing themselves.
You can generate lots of wealth by real estate investing. You can create income regardless of the economy. Using a knowledge base of real estate investing, short sales, bulk reo sales and virtual real estate you will be able to make success for yourself. Knowing the basics of real estate investing will help you succeed as a real estate investor. Knowing some real estate investing basics (beyond what older gurus like Robert Allen teach) and applying them will help you succeed as a real estate investor.
Great real estate investing resources are available at RealEstate.BryanEllis.com.
April 23rd, 2010
House flipping is defined as purchasing a house that is in a bad condition at a low market price and consequently raising its value and selling it in for a profit. But this not like development investing wherein a consumer purchased a property that’s currently under renovation and afterwards resell it or have it rented. If you know the best way to play the game wisely, you can definitely gain profit of more than $50,000 every flip. An average timeframe of flipping is under ninety days. Here you will learn the steps of how to flip a house. So if you are looking to gain a much higher income in flipping a house, you must continue reading this article.
To start with you should be acquainted with the right procedure for getting a house or a residence unit. After that you’ll easily accustom yourself with the system and its character. Should you be a first timer, it’s also a good idea that you seek the guidance of real estate professional.
Next is to review the specific real estate market from which you are trying to make investments on. You can also find quite a few reading materials that you may look at. Some of these could help increase your understanding by reading the frequent writings related to real estate. When you have gain the knowledge, you’ll be able to start searching for the property. Look for something that could be sold in a very good value. You can buy a house that needs improvement; an improvement can actually supply good profits once you flip a property.
More people are in search of houses that are not in good shape, these properties are actually the ones which make proprietors irritated when selling due to reasons like divorce, bankruptcy, death and bad condition of the home and property.
Another important step is to acquire a bank loan for a nominal amount of money that can be a lot more than the price of the property that you would like to flip. The money may be used to repair the property. You always have the right to negotiate the price before you purchase it; ensure that you have the means of getting in this arrangement. As soon as you already purchased it, ensure you are always up to the development of the exact property. Work on it swiftly in an inexpensive way. Make the look of the property nicer and still sell it in a good price.
When you are done fixing the exact property and get it improved, the next thing is to present it to your prospect customers.
I hope this article will give you a good understanding of flipping a house. Best of luck!
April 16th, 2010
The recession in the U.S. economy has resulted in more foreclosures than experienced by any other generation of Americans. Yet as always, this challenge has given rise to a huge new opportunity for alert real estate investors.
‘Bulk REO Investing’ is the name of the new strategy, and it’s captured the attention of many well-heeled investors.
Let’s take a moment to analyze the basics of this incredibly lucrative business.
To understand Bulk REO investing is to understand the foreclosure process.
Mortgage lenders faced with a non-paying home owner send a large volume of threats, warnings and documentation to the borrower who is late. Following a period of time determined by the lender, formal foreclosure proceedings begin. ‘Pre foreclosure’ is the name given to the time between implementation of the foreclosure proceedings and the public auction.
The defaulted property is ultimately auctioned, thus completing the foreclosure process. If there are no buyers at the foreclosure auction, the lender regains title to the property. The lender then categorizes the property as ‘Real Estate Owned’ – or ‘REO’ for short.
Local real estate agents are usually used to resale REO properties at retail price to the general public. But more and more, lenders are selling their REO properties for a greatly reduced price. The trade-off is that the buyer must purchase multiple REO properties in each transaction.
The REO investment packages available today have provided a way to profitably capitalize on the U.S. recession. The most successful Bulk REO Investors will have a well-respected source of funding for their transactions. Some sources of funding for these transactions are: personal funds, hard money lenders, commercial lenders and non-conventional sources such as private investors and hedge funds. Additionally, one man is becoming very well known in the field of bulk REO investing, and his name is Sal Buscemi of Dandrew Capital Partners, a New-York based hedge fund.
April 1st, 2010
It is likely that you think of a number of things when you hear the words virtual real estate investing. You might immediately leap to real estate investing being real estate portfolios and real estate retirement plans or you may think instead of short sales, bulk reo investing and virtual real estate investing. You may also consider what roles these things play in your life as a real estate investor in different economies.
You can learn a lot about real estate investing. Getting the most out of real estate investing education involves being familiar with basic RE info. Whether your target is short sales, bulk reo sales, virtual real estate or improving real estate investor abilities, you need to know some real estate investing basics. Check out these three real estate investing tenets that many experts do not fully know:
1. You will always end up with a positive yield when you invest in real estate investing education. Every good real estate deal represents thousands of dollars in potential wealth. Understanding how to get that wealth will be the key to your success. Learning about real estate increases your chances of success when you do a real estate deal. Implementation of your small educational investments yields big results.
2. You have the ability to succeed in real estate investing in any economy. Many people think (wrongly) that you can only succeed in real estate when the economy booms. In fact a bad economy is not a bad economy for real estate investors. You frequently can get properties at deep discounts. In addition, you can find deals that simply would not exist in a booming economy. Poor economies can turn based on active real estate investing. When an economy is less than thriving, short sales, bulk reo sales and virtual real estate can prosper. You will be able to save yourself and others from serious financial difficulties if you know how to do these deals.
3. You will not need lots of money to be a successful real estate investor. You can succeed in real estate investing no matter how much money you have. There are a lot of deals that you can do with other people’s money. If you look like a good investment a private lender may let you use their money. The best way to look like a solid investment is to have an in-depth knowledge of real estate investing. This will help you show private lenders that you are a good investment if they do not know about real estate investing themselves.
You can generate lots of wealth by real estate investing. You can create income regardless of the economy. By using a base of knowledge of real estate investing, short sales, bulk reo sales and virtual real estate you can create success for yourself. Knowing the basics of real estate investing will help you succeed as a real estate investor. Knowing some real estate investing basics (beyond what older gurus like Robert Allen teach) and applying them will help you succeed as a real estate investor.
Great real estate investing resources are available at RealEstate.BryanEllis.com.
March 5th, 2010
Stock markets this side of the pond have reacted very positively to this impressive news and many of the other European indexes have followed London’s lead. The country, well at least the majority of the public, are hoping that this could be the start of a sustained improvement in the economic situation.
I must say that I am by no way a house price expert; I am in fact involved with offering Marks and Spencer voucher codes as well as other business interests including offering a DVD duplication service and about providing jobs in foster care.
Many governments from various countries around the world acted in a decisive manner offering stimulus packages and other measures in the hope that this would help the economy out of recession in as quick a time as possible, very well done is what I say.
The FTSE 100 index on the UK stock market has risen over three percent on the news and there is a confidence that it will rise further. All of the other European stock markets have also risen sharply and the hope is that the Dow Jones will also join in with the party when it opens later.
The word and general opinion coming from those “in the know” is that this could be the start of a much awaited house price bounce. There are many people in the country who want to buy a house but have been unable to raise the capital or obtain a mortgage. Credit is starting to flow a little easier, once again, and this in turn will of course help the housing market to become more fluid.
Before everyone becomes too excited and starts to spend all of their money thinking that the happy days are here again I would wait a while; there may well be further bad news around the corner. Prudence and patience are still the watch words of the day.
February 22nd, 2010
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