ReeHart – Blogging from the Heart

Posts Tagged ‘real estate investor’

Real estate investing probably makes you think of a number of things. If you are already familiar with real estate investing you may think of short sales, bulk reo investing and virtual real estate investing or you may think of it in terms of real estate portfolios and real estate retirement plans. 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.

There is a lot to learn about real estate investing. Knowing the basics of real estate investing education is a good way to get the most out of every lesson. 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. Review these three real estate investing basics that even some experts don’t yet know:

1. Real estate investing education always yields positive. In any real estate deal, there will be thousands of dollars in potential wealth. Knowing about getting that wealth is the key in the end to your success. Learning about real estate increases your odds of success when you do a real estate deal. Small investments yield big results when you invest in learning and then implement what you learn.

2. You have the ability to succeed in real estate investing in any economy. Many people are under the misconception that success is possible in real estate only when the economy is good. In reality, poor economies are great for real estate investors. You frequently can get properties at deep discounts. Additionally, you may find deals that would not exist in a booming economy. In fact, real estate investing can turn the tide for a poor economy. When the economy is not so good, short sales, bulk reo sales and virtual real estate are great. You will have the option of saving yourself and possibly others from serious financial difficulties if you know about these types of deals.

3. A lot of money is not vital to your success as a real estate investor. You can succeed in real estate investing no matter how much money you have. Many types of deals enable you to use other people’s money to do them. If you appear to be a solid investment you may be able to use a private lender’s money. A good investment will know as much as they can 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.

A good deal of wealth can be generated with real estate investing. You will be able to create an income no matter what the economy. You can create your own success using your knowledge of short sales, real estate investing, bulk reo sales and virtual real estate. You will be helped to succeed as a real estate investor by knowing real estate investing basics.

Get ready ,this is the age of creative real estate financing. Do you remember when financing meant you saved up enough money to put 20% down on a house, and then got a mortgage loan for the other 80%? You can still do that, but there are many more options now. Here is a list of ten of them.

1. Second mortgage loans from sellers. Several banks will allow you to have as little as 5%, going into a home purchase, but will then only loan you 80%. The seller can then take payments on a second mortgage from you for the other 15% due.

2. Manufacturer loans. Manufactured-home companies are arranging financing with 5% or less down for their buyers. This can be as low as $2,500 down if you already have property to put the home on.

3. Housing programs through State governments . Many states have some sort of financing help in the form of a loan-guarantee program or outright loans for buyers with low incomes.

4. VA mortgage loans. If you have been in the armed forces, have a good job, and can save a few paychecks, you can probably get a home with a VA loan.

5. Contract for sale. Called a “land contract” and other names depending on the part of the country you are living in, this means that you make payments to the seller instead of the bank. It’s up to you and the seller to negotiate downpayment amount, interest rate, and the terms of the loan.

6. Builders gifting programs. In some parts of the country, builders fund foundations that give you a part of the downpayment, so you can get into a home with as little as 3% downpayment from your own pocket. FHA and other lenders have approved this so far.

7. FHA mortgage loans. The Farm Home Administration doesn’t actually loan the money, but guarantees your loan for the bank, so they can loan up to 97% of the purchase price, depending on the particular FHA program.

8. Loans from friends and family. It may not be from charity that a brother or a friend lends you money to buy a home. That 7% return might look really good if their money is sitting in the bank at 2%.

9. Bank no-doc loans. “No-doc” and “low-doc” loans, meaning no or low documentation requirements, are back, and you can find them through online banks. They are for those of you with bad credit but 20% to 30% to put down on a home. You don’t even need a job.

10. Credit card. A risky way, but if you have a low-interest credit card, you can use it to pay the downpayment, especially if you can pay it off quicky, perhaps with a coming tax refund. The banks generally won’t allow this, but it is possible if you combine this with seller financing.

So are there more ways to approach real estate financing? You betcha! These are just some create ways to buy your own home. When you start investing, you can use other techniques for REALLY creative real estate financing.

Getting into your first house is a scary deal for most of us. terms we dont understand, contracts written in legalese that we cant figure out…and lets not even talk about financing guidlines. Some people wont buy a home just out of the fear of the unknown.

For most people buying a home is the largest financial purchase they will make. If it is your first time be sure to take advantage of all the program information and home buying programs you can.

Be sure to prepare yourself before buying. Here are six steps to follow before buying:

1) Before you start your house search, think carefully about what it will be like to be a homeowner. For most people, home ownership is an integral part of the American dream and the advantages (tax benefits, sense of home, financial investment) far out weigh any drawbacks.

2) Have an idea about your credit right from the start. Your FICO score will normally be between 400 and 850. the higher the score the better your funding chances are. Get a copy of your credit report and review it. Look for any discrepencies and report them to the agency. In some cases you may want to use a credit repair agency.

3) Know your finances. A down payment is a big barrier to homeownership. There are, however, many different loans/mortgages out there that offer low down payment options. You should work with a quality mortgage broker or banker to find out what would work best for your situation. And don’t forget the government…a HUD loan is usually a great way to get into your first home also. Again, check with your broker or banker for more specifics.

4) When meeting with a good mortgage broker or banker, ask them to pre-approve you, not pre-qualify you. Pre-approval is an actual underwriting of your file (whether manually or auto-underwritten) and will let you know how much you can actually spend on a house and up to what rate you would be able to go to. This means, of course, that you will have to provide your income documentation, credit, and various other items required by the lender to actually underwrite your file. When you are ready to make an offer on a home, you’ll have more bargaining power over someone who is just pre-qualified, which just means someone has looked over your info and thinks you would qualify for financing.

5) While meeting with your mortgage broker or banker, have them look into any down payment assistance programs that may be available. There are many programs out there run by counties and cities and other agencies. The trick is to know about them, first, and then to see if you qualify for them.

6) Look into first-time home buyer classes. Many lenders, nonprofits, and Realtors offer home buyer education classes. They are usually 2 to 4 hours long and will walk you through the process of applying for a loan, working with a Realtor, making an offer, going to escrow (closing), and various other responsibilities associated with owning your own home. And realize that whoever is putting on the class is will also try and sell you on their services, which is fine, but you are under no obligation to use them.

By following these six steps you’ll be well on your way to homeownership! Remember, ask lots of questions and make sure you understand exactly what is happening. Always try to get referrals from people you trust. Good luck.