Real Estate Investing: Beware of Subject To Promises
Another real estate writer's mini course, full of promises and fluff, ended with a "lesson" on why you need to buy his book so you can finance multiple properties "subject to." The reason, he said, "because banks won't let you finance more than ten mortgages." This simply isn't true. First, banks let you finance as many mortgages as you can pay for. Some banks limit the number of loans made to one person. Experienced real estate investors just move on to another lending institution. I know one investor who owns more than one hundred single family homes. All have mortgages. He constantly refinances one rental for the down payment to buy the next. Besides living off the cash flow from his rentals, he also refinances a rental occasionally to take his family on a first-class vacation. Another investor, my friend who owns the carpet company we use for our fixers, owns more than fifty rentals. None were purchased "subject to" the existing loan. Many were purchased "all cash" for quick closings, with mortgages added later. For beginning real estate investors, looking for an owner willing to sell their property "subject to" the existing loan adds a frustrating component to the search for a profitable property. Today's savvy home sellers just won't sell to a buyer who can't cash them out. Of course, some investors offer "subject to" and lease-option purchases. But, properties with most of the equity stripped out come with payments too high for rental income to support. These properties make better candidates for owner-occupant home buyers with poor credit who don't mind paying more for a house. Beware of "subject to" seminars, books, and promotions. This real estate investing method worked last century. Copyright (c) 2005 Jeanette J. Fisher. All Rights Reserved. Jeanette Fisher teaches real estate investing and credit college courses. She became a credit expert to help her real estate students buy their dream home and multiple investment properties. Jeanette is the author of "Credit Help! Get the Credit You Need to Buy Real Estate" and other books. For a free report, "Credit Tips for Mortgage Financing," visit the Real Estate Credit Help Center http://recredithelp.com
MORE RESOURCES:
Google News
|
 |
|
|
RELATED ARTICLES
We Buy Houses Scams - How to Spot Them and How to Avoid Them
There are many reasons why a home owner would want to sell a house fast. Job change, relocation, debt problems, divorce and inheritance are just a few.
Why Not To Invest In Bulgarian Property
According to research carried out by the Thomson Group, owning a property abroad is now the ambition of over 50% of the British population. Not surprisingly Spain and Cyprus remain the most popular destinations for second home buyers while countries like France, Italy and Portugal continue to grab their fair share of the property investment gold rush!While the usual suspects will always attract the more cautious, risk aversive investor, the most recent generation of property investors can't seem to get enough of what our Eastern European neighbours have to offer.
Why Move to the Poconos?
Awaken to the sounds of softly rustling trees and tranquil gurgling streams. Stroll along quiet lush wooded mountain trails.
Maintaining Small Town Charm In An Ever-Changing World
Virtually any state in the country has the appeal of multiple small towns. Ask almost anyone who lives in small town why they are here and they'll tell you they enjoy the small town feeling while being close to all the conveniences of a larger city.
10 Tips for Investing in Distressed or Foreclosed Properties
1. Search on the world wide web for distressed or foreclosed properties as a starting point.
Lock In Big Profits By Offering Rent To Own Deals
Why would anyone accept a lease option, rent to own deal? Why would you, as a seller/investor look to find rent to own tenants? How can you use this technique to LOCK IN profits that are much greater than would be found in a straight sale?Basically, the advantages depend on which of two end results occur: either the rent to own tenant completes on the property, or they don't. You make money either way!There are MANY people who have less than sterling credit, might not have a long time on the job, or not have a ton of money for down payment, closing, etc.
Think You Can't Afford Your Own Home, Think Again!
Do you have bad credit, no credit, filed a bankruptcy, have a ton of late pays, medical bills, or been through a divorce? Well, we have the perfect solution for you - Lease Purchasing your own home!What is Lease Purchasing?A Lease Purchase is a process that combines a basic rental lease with an agreement to purchase, or with an option to purchase the property. The Buyer (or Lease-Purchaser) pays to the seller a monthly payment that usually approximates a rental amount or a typical mortgage payment on the home.
Property for Sale in Piemonte Italy is Attracting British Interest
The Region has four distinct seasons but in general possesses a Mediterranean feel strongly influenced by the proximity of the Mediterranean Sea. Winters are short and cold (the snow and mountains providing spectacular scenery for the region's ski resorts).
How Do I Bring Consulting Into My Lease Purchase Business
As you are making your cold calls on property, you will run into sellers that are having a hard time selling, however, the numbers just don't work for you to take on the deal. Do you just say, "I can't work with those numbers".
Conversation & The Real Estate Investor
One key that makes investors is conversation or should I say "The Art Of Conversation".All successful investors are skilled in conversation and I'm not talking about the investors that does 10, 20 or even 30 deal a year! I'm talking about the "BTO" Big Time Operator; The Big Dog's slamming down 100 or more deals every year.
Timing Is Everything When It Comes To Buying Homes
The old adage that "timing is everything" especially applies to buying a new home. And trying to be at the right house at the right time and get it for the right price can be tricky.
Staging Homes for Top-Dollar Sales
Wouldn't it be nice to have Roger Hazard's design team from "Sell This House" come visit for a weekend?Many "redecorators" and designers offer "Staging Homes" services from $250 to $5,000. These services usually give good advice, some help with the actual work involved, and others even move in new furniture for you.
Hey Landlord! Is Your Lease Legal?
The longer you are a landlord the more you strive to create the perfect lease/rental agreement. Landlords learn in the school of hard-knocks that some tenants are certified trouble makers and we try our best to protect ourselves with a carefully structured restrictive lease.
California Home Seller Disclosure Duties
Property Condition - Seller's What to Expect During the Inspection ProcessThe Transfer Disclosure Statement (T.D.
The Ultimate Short Sale Secret
Buying foreclosures can be extremely profitable for real estate investors. However, most of these homeowners are mortgaged to the hilt.
The UK has Gone Property TV Show Crazy!
The UK has gone property TV crazy. There are now shows about developing, buying, doing up and selling your home on every channel nearly every day.
How to Make Money from the California Real Estate Gold Rush
What do the Californians know that we don't?What is so special about California? Why is the average price of a house there five times higher than nationwide? Why on a salary of $100,000 per year, you can hardly afford to rent a decent apartment in the large cities there?It is true, Californians have a nice looking Pacific coastline. They also have a pleasant climate.
Is It Wise to Take My Home Off the Market for the Holidays?
Let's say you've had your home on the market for many months without a sale. The holidays are drawing near.
How to Qualify For 90% Plus Commercial Financing!!!
There are three important questions that you must understand and answer correctly in order to achieve 90% plus commercial financing! Where to go to locate it? What type of project will qualify? And last, how to negotiate for it?To start, you must understand the lender's mindset?..
Four Reasons To Offer Seller Financing
An example of seller financing: Years ago I bought a rental property, and nine months later sold it for 15% more, without fixing or improving a thing. The easy terms are what sold it.
|
