In business, wholesale is defined as the sale of merchandise to retailers rather than directly to the public (The New Dictionary of Cultural Literacy, Third Edition). In real estate investing, the term means to buy property below market value then use one of several possible exit strategies to make your profit.
“Wholesaling is one of the most powerful strategies in real estate investing, and it really is something you can do with no money and poor credit,” says Russ Whitney, founder and CEO of Whitney Information Network, Inc.
Whitney, the bestselling author of Building Wealth (Simon & Schuster), Real Estate Millionaire Mentor (Dearborn), and The Real Estate Millionaire Mindset (Doubleday), notes that wholesale investors have traditionally targeted distressed properties in less-than-desirable neighborhoods. “The problem with that approach is that new investors might not feel comfortable spending a lot of time in low- and moderate-income areas,” Whitney says. “It’s important to know that wholesaling works in nice neighborhoods every bit as well—and often even more profitably—as it works in not-so-nice neighborhoods.”
Typically wholesale properties are owned by strongly motivated sellers who are eager to get rid of what has become a problem for them. The property may be in poor condition and require repairs the owner can’t or won’t do before it would appeal to an average home buyer. You can buy these properties at a discount, do the necessary fix-up, and either hold the unit in your own portfolio as a rental or sell it.
Of course, that strategy usually takes access to some cash and financing. Whitney says another way to make money on a wholesale deal is not to buy it. Instead, he says, get the property under contract then assign that contract to another investor for a fee.
In addition to requiring virtually no cash beyond the nominal deposit (usually $100 or so) that you will put up with your contract, this technique makes everybody involved a winner: The property owner is getting rid of a problem; the investor you’re assigning the contract to is getting a good deal without having to do any work to find it; and you’re making some cash that you can use to further your investing business.
The key to successful wholesale investing is finding motivated sellers. “The question you need answered is, ‘Do they want to sell or do they have to sell?’ To find out, all you have to do is ask why they’re selling,” Whitney says. “Most people will tell you enough to let you know whether or not they’re motivated.”
An owner who simply wants to sell but is not under any pressure may not be willing to accept the discounted price you need to do a profitable wholesale deal. If that’s the case, move on to the next deal. Give the seller your name and contact information so he can call you if he changes his mind. You might also keep the details of the property in a database and check back every six months or so to see if circumstances have changed. But don’t spend a lot of time trying to do a deal with a seller who isn’t motivated.
Finding wholesale deals
So how do you find the motivated sellers with great wholesale deals? Some of the traditional ways include working with real estate agents, checking classified ads, and looking for properties that have been on the market a while. More effective ways include marketing, networking, and tracking vacant houses.
When you market effectively, you will find out about properties before other investors do because people will call you when they are ready to sell. Networking is closely related to marketing because it establishes you as the go-to person for anyone who has a piece of problem real estate.
One way to find vacant houses that might be good wholesale candidates is to regularly drive through neighborhoods where you want to invest and look for indications that a house is vacant. When you find a vacant house, track down the owner and ask if he’s interested in selling. In most cases, you can find the owner by a simple check of the public property records. Send a postcard or letter, or you might even want to make a phone call. If the owner isn’t interested, continue to monitor the property and follow up in a few months.
“Wholesaling is a great strategy for both new and established investors,” says Whitney. “It allows you to make quick cash when you don’t have any. When you’ve accumulated some cash, continue using this strategy to build your portfolio.”
Jordan Taylor is the editor of Millionaire Mentor™ Newsletter, which is published by Whitney Education Group, Inc.
Sunday, July 13, 2008
Monday, May 26, 2008
7 Steps To Avoid Foreclosure
Has it come to the point where you have asked yourself "How can I avoid foreclosure to save my home?" Don't feel alone. There are millions of Americans today facing the same problem.
If you are at this crisis in your life, I know you don't have much time to spend on reading. So we will get straight to the steps you need to save your home.
Step 1: Never avoid the situation. If you avoid making your full house payments, it will catch up with you within 3 months. If you put off the situation and hope it will get better you are only wasting valuable time. As you will see below, every day you are active in getting the situation resolved the easier it will be to avoid any foreclosure of your home.
Step 2: Contact your lender as soon as you know you have a problem.
You may not want to contact your lender because of embarrassment. It is natural to feel this way. It is not going to be on of those fun conversations to have, but avoiding the situation will only cause you more problems in very near future. Lenders don't want to start foreclosure proceedings on you home because of all the expenses involved (court fees, attorney fees, etc.). They would much rather discuss a modified repayment plan. If you don't feel comfortable talking with the lender then you should look into getting a foreclosure specialist to help with the process.
Step 3: Gather all your financial documents. You will need to have your loan number, a month's worth of your most recent paycheck stubs, a list of all your credit card debt, hospital bills etc. You should sit down and create a budget showing your income and expenses for a whole month. You should also prioritize your spending. Cut out the things you don't need, like cable, internet access, etc. The budget will show the lender you have already done some of your homework on how to work out a solution.
Step 4: Respond to any mail or phone calls you receive from your lender. This step is very important. You don't want the lender to think you are trying to avoid the situation. At this point you want to be very cooperative.
Step 5: Know your rights as a borrower. You should find your loan documents and read them. They will tell you what the lender can do if you are unable to make your payments.
Step 6: Determine how much you have in assets. Do you have some jewelry or a second car that you can sell? You may even have a life insurance policy you can cash in. Although these may not increase your cash flow, it will demonstrate to the lender that you are willing to make sacrifices.
Step 7: If you have gotten to this point and don't feel you are able to resolve the situation then you should seek the help of a professional foreclosure counselor. There are many companies that offer free consultations. You are not obligated to use their services, but you can definitely find the answer to your question of "How can I avoid foreclosure?" These professionals have many contacts in the banking market and can often times offer solutions you may not be able to find on your own.
Foreclose on your home is very serious. It can ruin your credit and more importantly ruin you way of life. Don't' become a victim. Find more solutions on how to stop or avoid foreclosure at http://www.foreclosure-free.com
Michelle Travis has over 20 years of experience in the credit and debt industry and works hard to provide solutions for you. If you would like to get more solutions on getting out of debt and credit repair goto http://www.your-credit-solution.com
Article Source: http://EzineArticles.com/?expert=Michelle_Travis
If you are at this crisis in your life, I know you don't have much time to spend on reading. So we will get straight to the steps you need to save your home.
Step 1: Never avoid the situation. If you avoid making your full house payments, it will catch up with you within 3 months. If you put off the situation and hope it will get better you are only wasting valuable time. As you will see below, every day you are active in getting the situation resolved the easier it will be to avoid any foreclosure of your home.
Step 2: Contact your lender as soon as you know you have a problem.
You may not want to contact your lender because of embarrassment. It is natural to feel this way. It is not going to be on of those fun conversations to have, but avoiding the situation will only cause you more problems in very near future. Lenders don't want to start foreclosure proceedings on you home because of all the expenses involved (court fees, attorney fees, etc.). They would much rather discuss a modified repayment plan. If you don't feel comfortable talking with the lender then you should look into getting a foreclosure specialist to help with the process.
Step 3: Gather all your financial documents. You will need to have your loan number, a month's worth of your most recent paycheck stubs, a list of all your credit card debt, hospital bills etc. You should sit down and create a budget showing your income and expenses for a whole month. You should also prioritize your spending. Cut out the things you don't need, like cable, internet access, etc. The budget will show the lender you have already done some of your homework on how to work out a solution.
Step 4: Respond to any mail or phone calls you receive from your lender. This step is very important. You don't want the lender to think you are trying to avoid the situation. At this point you want to be very cooperative.
Step 5: Know your rights as a borrower. You should find your loan documents and read them. They will tell you what the lender can do if you are unable to make your payments.
Step 6: Determine how much you have in assets. Do you have some jewelry or a second car that you can sell? You may even have a life insurance policy you can cash in. Although these may not increase your cash flow, it will demonstrate to the lender that you are willing to make sacrifices.
Step 7: If you have gotten to this point and don't feel you are able to resolve the situation then you should seek the help of a professional foreclosure counselor. There are many companies that offer free consultations. You are not obligated to use their services, but you can definitely find the answer to your question of "How can I avoid foreclosure?" These professionals have many contacts in the banking market and can often times offer solutions you may not be able to find on your own.
Foreclose on your home is very serious. It can ruin your credit and more importantly ruin you way of life. Don't' become a victim. Find more solutions on how to stop or avoid foreclosure at http://www.foreclosure-free.com
Michelle Travis has over 20 years of experience in the credit and debt industry and works hard to provide solutions for you. If you would like to get more solutions on getting out of debt and credit repair goto http://www.your-credit-solution.com
Article Source: http://EzineArticles.com/?expert=Michelle_Travis
Sunday, May 18, 2008
Real Estate Investing - Flip or buy and hold?
There are many ways to make money in real estate, but all the different methods boil down to two. The big decision in real estate is whether to flip a property for a fast profit or to hold on to the property for long term wealth.
The advantages of a flip are as follows:
You make a fast profit and can move on to the next deal. One of the downsides of holding a property is that you have to be a landlord. There is nothing more difficult to me than being a landlord. When I flip a property I don't have to worry about collecting rent or fixing the property over and over. I don't have to find someone to rent the property. There something to be said about a quick profit.
Finding a property to flip is fairly easy. Ugly properties are not hard to find, especially in the large cities. In Atlanta Georgia there are so many properties available for rehab and not enough investors.
Flipping a property is more interesting than find and hold. If you like excitement then flipping properties is your game. There are good times and bad times that come with flipping properties and it is never boring.
The disadvantages to a flip are as follows:
You will have to pay more taxes when you sell a flip. When you flip a property your profit will be taxed as ordinary income. This can be as much as forty percent of your profit.
Flipping a property means you must keep selling homes. The easy part of flipping is buying the property and then fixing it up. The hard part is selling the property.
The advantages of holding a property are as follows:
If you want long term appreciation then you need to buy and hold. There is no denying that if you buy a property at discount and then put a renter in the property for twenty years that you will have an investment that has appreciated tremendously.
Cash flow will come to the person who holds their properties for a long time. Positive cash flow usually takes time and if you are willing to wait a few years you will have a good monthly income.
The obvious problem with holding properties is being a landlord. If every renter stayed, paid on time, and never destroyed your home, then there would be no problems. Unfortunately you will have to find new tenants often. You will not collect all of the rent you are due. You will have to fix a property every once in a while.
The decision to flip or hold is a difficult one. I like to do both. If I find a home worth holding I hold it. If the property is too far away or needs too much work to be rental worthy then I will flip the property. Both have their good points and bad. The bottom line is that you need to be comfortable with your decision. Being a real estate investor should be fun first and an investment second. So do what you like most and feel best doing.
Article Source: http://EzineArticles.com/?expert=Max_Suther
The advantages of a flip are as follows:
You make a fast profit and can move on to the next deal. One of the downsides of holding a property is that you have to be a landlord. There is nothing more difficult to me than being a landlord. When I flip a property I don't have to worry about collecting rent or fixing the property over and over. I don't have to find someone to rent the property. There something to be said about a quick profit.
Finding a property to flip is fairly easy. Ugly properties are not hard to find, especially in the large cities. In Atlanta Georgia there are so many properties available for rehab and not enough investors.
Flipping a property is more interesting than find and hold. If you like excitement then flipping properties is your game. There are good times and bad times that come with flipping properties and it is never boring.
The disadvantages to a flip are as follows:
You will have to pay more taxes when you sell a flip. When you flip a property your profit will be taxed as ordinary income. This can be as much as forty percent of your profit.
Flipping a property means you must keep selling homes. The easy part of flipping is buying the property and then fixing it up. The hard part is selling the property.
The advantages of holding a property are as follows:
If you want long term appreciation then you need to buy and hold. There is no denying that if you buy a property at discount and then put a renter in the property for twenty years that you will have an investment that has appreciated tremendously.
Cash flow will come to the person who holds their properties for a long time. Positive cash flow usually takes time and if you are willing to wait a few years you will have a good monthly income.
The obvious problem with holding properties is being a landlord. If every renter stayed, paid on time, and never destroyed your home, then there would be no problems. Unfortunately you will have to find new tenants often. You will not collect all of the rent you are due. You will have to fix a property every once in a while.
The decision to flip or hold is a difficult one. I like to do both. If I find a home worth holding I hold it. If the property is too far away or needs too much work to be rental worthy then I will flip the property. Both have their good points and bad. The bottom line is that you need to be comfortable with your decision. Being a real estate investor should be fun first and an investment second. So do what you like most and feel best doing.
Article Source: http://EzineArticles.com/?expert=Max_Suther
Sunday, May 11, 2008
Real Estate Investing: Buying Property Out of State
Buying property out of your local area where you live is not something that is recommended for the new investor. That’s why we made purchasing our first real estate investment out of state our top priority! Why? Because a set of circumstances presented themselves that made sense for us to follow through on and purchase vacant land several states away. We paid cash for this property at a significantly lower price than market calls for in the area. Additionally, it matched our investment criteria and was a small enough deal for us that it made sense to buy it. Why have we italicized the term “us” thus far? Because this is a topic we believe does not belong on this site, however, we learned alot from the experience and want to share some simple lessons learned in this particular article as well as future articles. Bottom line, we are not recommending people new to real estate investing run out and buy property several hundred miles away!
Information is vital to good, sound real estate investing. No, good information is vital to sound real estate investing. No, actually, you, the buyer, gathering a ton of information about a property you plan to buy, is absolutely necessary in order to increase your odds for success at real estate investing! Phew! Okay, so we got that straight. So how do you get information and how do you get quality information? Do you call a few realtors and ask them about the area? That’s like asking a barber if you need a haircut. What about calling the local chamber of commerce? A local chamber of commerce is a good starting point, but it depends on who you speak with. For instance, you might speak to a person trying to market the area to bring business or improvement to the area. You may or may not get accurate information or the correct data given your investment goals.
Talk to multiple sources. Make several phone calls to different businesses. A reputable developer in the area can be an excellent resource for connecting you to other phone numbers to contact and possibly even some of their personal contacts.
Verify everything! Verify every statement a seller makes. If you can get someone to take pictures of the property you’re buying, that’s very important. If you’re buying vacant land, you’ll want to know if the lot is buildable, in a flood zone, zoning, utilities, sewer, and the surrounding neighborhood and subdivision.
When you contact municipalities, be sure to call back several times if you do not get a cooperative person on the phone. For some reason, people down south are nicer. They tend to spend more time on the phone with you and bear with you while you struggle to put two and two together. Don’t be afraid to let information sink into your head while you’re on the phone and ask the person on the line to wait while you write things down.
It pays to prepare for phone calls. Write down questions. It pays to have a questionnaire available. If you use ours feel free to make it your own. If you do not understand a terminology you can contact us or look it up online at any real estate investment website. Log all of your phone contacts and write down names and extensions of helpful people.
Another good source of information will be the local paper of that area. There you will find classifieds and legal notices which can give you an idea how business is growing and where and when foreclosure auctions are to take place. As you compile more places to follow up with from simply reading the paper, make sure you actually follow up! Many newspapers have websites, but you will not get the same information you will with the actual paper.
Additionally, you may also look into local real estate investor clubs and organizations. Here you will find possible online access to localized forums where you can chat and post questions, possibly make contacts and get further information. Local real estate investment clubs will help to get your foot in the door with other investors. This is important as you can learn what to do…and what not to do.
It cannot be stressed enough that is is very important to log everything you do. Make sure you write it down somewhere so that you may refer back to your notes on paper, rather than in your head. Hopefully, what you write, who you talk to and what you read will allow you to make wise decisions when considering your investment strategies for out of town real estate.
©2006 noobdogs.com
Noobdogs.com offers a place for fellow new investors in real estate to ask questions and get good, sound information they can understand. Noobdogs.com is owned and operated by AmeriCountry Realty Group LLC. Founded in 2006 by Tom McGiveron, a Behavior Specialist and entrepreneur, noobdogs.com is becoming the premier site for new investors to achieve success in personal development and real estate investment.
Article Source: http://EzineArticles.com/?expert=Thomas_McGiveron
Information is vital to good, sound real estate investing. No, good information is vital to sound real estate investing. No, actually, you, the buyer, gathering a ton of information about a property you plan to buy, is absolutely necessary in order to increase your odds for success at real estate investing! Phew! Okay, so we got that straight. So how do you get information and how do you get quality information? Do you call a few realtors and ask them about the area? That’s like asking a barber if you need a haircut. What about calling the local chamber of commerce? A local chamber of commerce is a good starting point, but it depends on who you speak with. For instance, you might speak to a person trying to market the area to bring business or improvement to the area. You may or may not get accurate information or the correct data given your investment goals.
Talk to multiple sources. Make several phone calls to different businesses. A reputable developer in the area can be an excellent resource for connecting you to other phone numbers to contact and possibly even some of their personal contacts.
Verify everything! Verify every statement a seller makes. If you can get someone to take pictures of the property you’re buying, that’s very important. If you’re buying vacant land, you’ll want to know if the lot is buildable, in a flood zone, zoning, utilities, sewer, and the surrounding neighborhood and subdivision.
When you contact municipalities, be sure to call back several times if you do not get a cooperative person on the phone. For some reason, people down south are nicer. They tend to spend more time on the phone with you and bear with you while you struggle to put two and two together. Don’t be afraid to let information sink into your head while you’re on the phone and ask the person on the line to wait while you write things down.
It pays to prepare for phone calls. Write down questions. It pays to have a questionnaire available. If you use ours feel free to make it your own. If you do not understand a terminology you can contact us or look it up online at any real estate investment website. Log all of your phone contacts and write down names and extensions of helpful people.
Another good source of information will be the local paper of that area. There you will find classifieds and legal notices which can give you an idea how business is growing and where and when foreclosure auctions are to take place. As you compile more places to follow up with from simply reading the paper, make sure you actually follow up! Many newspapers have websites, but you will not get the same information you will with the actual paper.
Additionally, you may also look into local real estate investor clubs and organizations. Here you will find possible online access to localized forums where you can chat and post questions, possibly make contacts and get further information. Local real estate investment clubs will help to get your foot in the door with other investors. This is important as you can learn what to do…and what not to do.
It cannot be stressed enough that is is very important to log everything you do. Make sure you write it down somewhere so that you may refer back to your notes on paper, rather than in your head. Hopefully, what you write, who you talk to and what you read will allow you to make wise decisions when considering your investment strategies for out of town real estate.
©2006 noobdogs.com
Noobdogs.com offers a place for fellow new investors in real estate to ask questions and get good, sound information they can understand. Noobdogs.com is owned and operated by AmeriCountry Realty Group LLC. Founded in 2006 by Tom McGiveron, a Behavior Specialist and entrepreneur, noobdogs.com is becoming the premier site for new investors to achieve success in personal development and real estate investment.
Article Source: http://EzineArticles.com/?expert=Thomas_McGiveron
Wednesday, April 09, 2008
Foreclosure Financing
Foreclosure refinancing is the process of helping the homeowner keeps his home when he or she became default on their loan payment. This will happen sometimes, especially when unforeseen financial problems occur or unemployment occurs. Happily, there are wonderful options to refinance your home. Foreclosing on your home can be expensive to the bank to pursue, so before you seek foreclosure refinancing anywhere you will want to check the bank so you can here about available option. Call your bank because they may be able to temporarily help you to suspend the process as long as you agree to a more regular mortgage payment, and pay extra to catch up.
Some people may not have additional funds to pay every month, especially if they are having trouble paying now, so they can opt for another program which is called a Loan Modification, which means that all of the default loans are added to the end of the loan, saving peoples home and making mortgage payments regular and on time again. You are usually only allowed this benefit once during the life of the loan.
People who are not able to work out a suitable situation with their current lender may wish to research other foreclosure refinancing options. They must decide if they will be able to make the required payments in the future, if not then it would probably be a good idea not to add a refinance loan at this time but if this is a consideration then they should investigate further options. The internet holds many different options for people looking for foreclosure refinancing, with many lenders looking for clients just like you.
Another option you may wish to consider may be using the equity already accrued in the home to take a second loan or line of credit. The money could bring the current first mortgage up to date. The only problem is that the person would then be responsible for not one, but two mortgage payments.
If you are a homeowner in fear of losing your home you should try one of these options, if none work for you then consider selling the home before you lose it, at the close of the loan, the new persons mortgage company pays off the existing loan, cleaning your credit enough to buy a new home at rates you can actually afford.
Over all, we can say that foreclosures may be good news for all those people who are interested in investing their money in the business of real estate and property. On the other hand, it is not at all good news for those whose home or business property is being foreclosed. Foreclosures can be a good source of making lots of profits for the others, but not for the people whose property is being foreclosed.
Robert Grazian is an accomplished niche website developer and author. To learn more about foreclosure refinancing visit Hot Foreclosure Market for current articles and discussions.
Article Source: http://EzineArticles.com/?expert=Robert_Grazian
Some people may not have additional funds to pay every month, especially if they are having trouble paying now, so they can opt for another program which is called a Loan Modification, which means that all of the default loans are added to the end of the loan, saving peoples home and making mortgage payments regular and on time again. You are usually only allowed this benefit once during the life of the loan.
People who are not able to work out a suitable situation with their current lender may wish to research other foreclosure refinancing options. They must decide if they will be able to make the required payments in the future, if not then it would probably be a good idea not to add a refinance loan at this time but if this is a consideration then they should investigate further options. The internet holds many different options for people looking for foreclosure refinancing, with many lenders looking for clients just like you.
Another option you may wish to consider may be using the equity already accrued in the home to take a second loan or line of credit. The money could bring the current first mortgage up to date. The only problem is that the person would then be responsible for not one, but two mortgage payments.
If you are a homeowner in fear of losing your home you should try one of these options, if none work for you then consider selling the home before you lose it, at the close of the loan, the new persons mortgage company pays off the existing loan, cleaning your credit enough to buy a new home at rates you can actually afford.
Over all, we can say that foreclosures may be good news for all those people who are interested in investing their money in the business of real estate and property. On the other hand, it is not at all good news for those whose home or business property is being foreclosed. Foreclosures can be a good source of making lots of profits for the others, but not for the people whose property is being foreclosed.
Robert Grazian is an accomplished niche website developer and author. To learn more about foreclosure refinancing visit Hot Foreclosure Market for current articles and discussions.
Article Source: http://EzineArticles.com/?expert=Robert_Grazian
Friday, April 04, 2008
Common Mistakes Investors Make
The question will always be which came first the chicken or the egg. In real estate it may be the deal or the plan. Many people make the mistake of finding a great property and then do not know what they are supposed to do. This is where the trouble begins. They have worked themselves backwards into a corner. The idea is to formulate a plan and then find the house which will work with this plan.
Failing to Plan: We are a planning people. We plan for the future, the college education for the kids, and retirement. When it comes to real estate it only makes sense to plan for that too. Sometimes the novice investor gets ahead of themselves and forgets to draw up a plan. Deciding what you want to do in the real estate market will determine what houses you buy and how you sell them. It is best to always have a plan.
Get Rich Quick: Planning to get rich quick is another common mistake. The big deals which will net you millions are usually only a dream. Investing in real estate is a slow and steady process. When you proceed at a steady pace, you will keep moving forward towards your goal. You can make money, but being a millionaire over night is stretching the limit.
On average a good investor can make $60 to $100 thousand a year with proper real estate investments. This strategy allows for a steady forward progress and takes into consideration that not everything will go as planned. You must keep real estate investing just what it is REAL.
Team Work: Don't think you can do it alone. There are many people who play a key role in making a real estate deal work. The smart investor has a team of specialists who assist him or her. They may not even know they are part of your team, but it's a team all the same.
You will need a good real estate agent or investment firm you can trust to help you analyze the properties. You will want an appraiser and a contractor or inspector to make sure the property is worth the investment. You probably even need a lender. The most important part of the team is the attorney or title/escrow company who is going to make sure there are no hidden surprises which may crop up at any point in the deal. This is not a loner business.
Due Diligence: One of the biggest mistakes investors make is not conducting their own thorough due diligence on the investment property. This is where well intentioned investors end up losing money, or worse yet, end up foreclosing and ruining their credit. Due diligence means taking the time to research and verify the benefits and risks related to the investment. Examining the local market for growth and stability, values of local comparable properties, rental rates and demand, condition of the property if buying used, and of course a cash flow analysis.
Exit Strategies: Real estate investing is not a business with a single strategy either. You should have a plan A, B, and C. On occasion it does not hurt to have a D in the mix. For example, you may want to buy a home and resell it within 6 months but then the housing market changes quickly. If you can't get it ready for market in time to sell for profit, you may need to consider renting it. There are times when the rental market stalls or becomes depressed. When this happens you could offer a land contract (also known as an all inclusive trust deed in some states), or a lease option to get rid of the property. There may come a time when the only thing you can do is to sell to another investor and cut your losses before you lose any more money. The wise investor also knows when to bail.
The common mistakes made by the inexperienced investor can be avoided with a little research and planning. When you decide to invest in real estate, be sure to keep learning the business. There are many books available which teach some of the strategies the pros use. There are seminars, many of them free, which teach you how to invest. Keep studying and make smart decisions when it comes to real estate investing. This way you can avoid the common mistakes investors make.
By: Marco Santarelli
Article Directory: http://www.articledashboard.com
Failing to Plan: We are a planning people. We plan for the future, the college education for the kids, and retirement. When it comes to real estate it only makes sense to plan for that too. Sometimes the novice investor gets ahead of themselves and forgets to draw up a plan. Deciding what you want to do in the real estate market will determine what houses you buy and how you sell them. It is best to always have a plan.
Get Rich Quick: Planning to get rich quick is another common mistake. The big deals which will net you millions are usually only a dream. Investing in real estate is a slow and steady process. When you proceed at a steady pace, you will keep moving forward towards your goal. You can make money, but being a millionaire over night is stretching the limit.
On average a good investor can make $60 to $100 thousand a year with proper real estate investments. This strategy allows for a steady forward progress and takes into consideration that not everything will go as planned. You must keep real estate investing just what it is REAL.
Team Work: Don't think you can do it alone. There are many people who play a key role in making a real estate deal work. The smart investor has a team of specialists who assist him or her. They may not even know they are part of your team, but it's a team all the same.
You will need a good real estate agent or investment firm you can trust to help you analyze the properties. You will want an appraiser and a contractor or inspector to make sure the property is worth the investment. You probably even need a lender. The most important part of the team is the attorney or title/escrow company who is going to make sure there are no hidden surprises which may crop up at any point in the deal. This is not a loner business.
Due Diligence: One of the biggest mistakes investors make is not conducting their own thorough due diligence on the investment property. This is where well intentioned investors end up losing money, or worse yet, end up foreclosing and ruining their credit. Due diligence means taking the time to research and verify the benefits and risks related to the investment. Examining the local market for growth and stability, values of local comparable properties, rental rates and demand, condition of the property if buying used, and of course a cash flow analysis.
Exit Strategies: Real estate investing is not a business with a single strategy either. You should have a plan A, B, and C. On occasion it does not hurt to have a D in the mix. For example, you may want to buy a home and resell it within 6 months but then the housing market changes quickly. If you can't get it ready for market in time to sell for profit, you may need to consider renting it. There are times when the rental market stalls or becomes depressed. When this happens you could offer a land contract (also known as an all inclusive trust deed in some states), or a lease option to get rid of the property. There may come a time when the only thing you can do is to sell to another investor and cut your losses before you lose any more money. The wise investor also knows when to bail.
The common mistakes made by the inexperienced investor can be avoided with a little research and planning. When you decide to invest in real estate, be sure to keep learning the business. There are many books available which teach some of the strategies the pros use. There are seminars, many of them free, which teach you how to invest. Keep studying and make smart decisions when it comes to real estate investing. This way you can avoid the common mistakes investors make.
By: Marco Santarelli
Article Directory: http://www.articledashboard.com
Saturday, March 22, 2008
Vacation Home Investing
Across the country, many people are buying second homes in America today. Although a sizable number of vacation home buyers plan to retire in those homes someday, another segment hopes their second home will do double duty--as a vacation getaway and an investment property. If you fit into the latter category, here are five areas of the country where you might want to begin your search.
* There are trade-offs to buying a second home in an area that's going to become one of THE hot places of the future, because you won't be the only one looking in that area, and it's going to grow quickly, bringing in more and more people. However, if those factors don't deter you, here are a few tips on how to look for a vacation property that will also prove to be a good investment over the long haul.
* Of course, a beautiful setting and decent weather are first and foremost, but the property must also meet a number of other criteria, as well. You'll want to begin your search in smaller towns that are still within a two or three-hour drive from a growing urban area with a large airport.
* There should be plenty of recreational opportunities. And that means things to do other than just shopping. Depending upon your personal taste, that typically means near a ski area, a beach, or in the mountains.
* It's also nice to have some cultural amenities nearby, since you won't always be in the mood to do strenuous physical activities. So make sure there are both stage and movie theatres, and it’s also advantageous to have art galleries and museums within easy reach.
* Take a look around and see if there’s commercial development going on in the area. Long-time residents may complain about how much the area is changing, but seeing new motels, malls, and other business investments moving into town is a good indicator that you're not the only one who thinks this section of the country is going to continue to grow.
With some diligent searching and a keen eye for what's going on in the area, you can find properties that will provide the best of both worlds. A wonderful getaway in a delightful vacation area AND a great investment that will continue to increase significantly in value while you make use of it.
Copyright © 2006 Jeanette J. Fisher
Jeanette Fisher offers free real estate investing information, free ebook, The Truth about Making Money Flipping Houses and teleseminars. http://doghousetodollhouse.com
Article Source: http://EzineArticles.com/?expert=Jeanette_Joy_Fisher
* There are trade-offs to buying a second home in an area that's going to become one of THE hot places of the future, because you won't be the only one looking in that area, and it's going to grow quickly, bringing in more and more people. However, if those factors don't deter you, here are a few tips on how to look for a vacation property that will also prove to be a good investment over the long haul.
* Of course, a beautiful setting and decent weather are first and foremost, but the property must also meet a number of other criteria, as well. You'll want to begin your search in smaller towns that are still within a two or three-hour drive from a growing urban area with a large airport.
* There should be plenty of recreational opportunities. And that means things to do other than just shopping. Depending upon your personal taste, that typically means near a ski area, a beach, or in the mountains.
* It's also nice to have some cultural amenities nearby, since you won't always be in the mood to do strenuous physical activities. So make sure there are both stage and movie theatres, and it’s also advantageous to have art galleries and museums within easy reach.
* Take a look around and see if there’s commercial development going on in the area. Long-time residents may complain about how much the area is changing, but seeing new motels, malls, and other business investments moving into town is a good indicator that you're not the only one who thinks this section of the country is going to continue to grow.
With some diligent searching and a keen eye for what's going on in the area, you can find properties that will provide the best of both worlds. A wonderful getaway in a delightful vacation area AND a great investment that will continue to increase significantly in value while you make use of it.
Copyright © 2006 Jeanette J. Fisher
Jeanette Fisher offers free real estate investing information, free ebook, The Truth about Making Money Flipping Houses and teleseminars. http://doghousetodollhouse.com
Article Source: http://EzineArticles.com/?expert=Jeanette_Joy_Fisher
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