If you are an investor looking to get into the real estate market, this is your best time to do so. You can get very rich if you plan it right. Many investors jump into something without thinking first and learning the ropes. It is very important to be educated first as an investor before you launch into any type of investing.
Once you have studied the market and you believe you are ready for the world of real estate investing there is one thing you should know before you find an investor to get involved or before you plunge into a contract. There are many types of real estates investments you can get involved with. These investments include foreclosures, tax liens, flips, and more. It depends on your cash flow and what type of investment you are looking to pursue.
But no matter what way you want to invest, the best and smartest way to invest is with no money down. This way you not only don't tie up your own money in the transaction, but you if you do it right, you can end up a very rich man to boot. Now you say, well that is all fine and good, but how do I find no money down deals and how to I go about obtaining these properties with no money down? These are all good questions which will be covered in turn below.
The first thing you should be aware of is looking for deals. Many times it is just a matter of being at the right place at the right time. But more than anything it is keeping your eyes open and your ears attuned so you can hear about any type of deal that may come down the pipe. If you drive down any city block in your area or neighborhood, I bet you can run across many homes that are for sale. Here is where you have the chance to strike a deal. You take down the phone number and give the seller a call. You offer the seller an offer he or she can't refuse. Then, if all goes well, you have yourself a piece of property.
Finding a home to buy is easy, the next challenge is finding a way to purchase the property without any money out of your pocket. Well, there are ways you can do this. Here are some ways you can obtain the property without putting a dime out of your own pocket.
? VA Loans ? If you are a veteran, you can purchase that home with no money down by simply going to the federal government for help. By going through the Department of Veterans Affairs, you can obtain the money you need. The only drawback to this type of deal, is you can only buy one property at a time. But it is a good start for the new investor, who also happens to be a former military man.
? Owner financing ? Here is one area that not too many people know about or are aware of. If you can provide the seller a good deal, you may be able to work out a lease-purchase plan with him or her. You will need to fill out a legal form and have both you and the seller sign it. With this type of arrangement, you can obtain the property with no money down. The only thing about this type of transaction is the seller agrees to sell the house at a price you agree on, at a future date. In the meantime, you are the buyer will pay a monthly amount to the seller. But this monthly amount can be way more than the average price of rent would be for the property. But if the agreement includes these payments as going toward the sell price of the home, the buyer will luck out because at a predetermined time, the amount the buyer paid monthly is deducted from the selling price, leaving a balance the buyer has to pay.
? Trading properties ? Another way to obtain property without any down payment is by trading property. Simply find a property of equal value and swap it. For example, if you know of someone who has a ten-unit apartment complex for sell and you have a beach front property, ro something similar, you may want to swap the property.
? HUD ? In many cases, HUD can provide you with special financing for an new property purchase without using any money of your own to secure it.
? Local programs ? Many states, counties, and cities have programs where you can buy a property without any money down. There may be some stipulations to get it and you may have to do some digging, but there are programs available.
? Flex 97 mortgage ? There are two government agencies (Fannie Mae and FHA) that developed certain types of mortgages to help those who can't get the money to pay for a property. In certain situations, these programs can pay as much as 97% of the purchase price of the property with you the buyer only needing 3%. And that 35 you don't have to pay either. Just get it as a gift from a friend or relative, or you can cash in an insurance policy, or sell any stocks you or anyone you know of that is close to you, has. Where there's a will there's a way.
? Lines of credit ? Some investors use their credit card's line of credit to obtain the down payment for the property. This way they pay less interest than if they had to borrow it from a bank.
There are many options open and available to the investor. You have to be smart, learn investing, and remember the motto ? OPM (other people's money). Do not use your own money. If you remember all these points, you will do well as a real estate investor.
Rod Khleif is a nationally-recognized authority in residential Real Estate-Investment. He has pioneered strategies that have resulted in the personal holdings of over 1500 properties and the restoration/leasing of over 6000 rental properties during the span of his career. Specializing in creative solutions for acquisition, renovation and leasing management, Khleif is making his knowledge available through a variety of publications and private speaking engagements. His contributions in philanthropy have led to the development of The Tiny Hands Foundation (TinyHandsFoundation.org) and A Better Choice Foundation (BetterChoiceFoundation.org). Rod Khleif can be reached at RodKhleif@hotmail.com or by visiting his website at WeBuyFlorida.com. |
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