Posts Tagged ‘buy a house’
How To Buy Real Estate – Yes, YOU CAN!
If you want to buy a house but don’t think you can for any of the following reasons, this article is intended to give you correct information so that you can make smarter choices and open yourself up to a world of wealth, possibilities and realistic expectations.
The truth is you are being unrealistic when you believe the following reasons to be true:
I can’t buy property now because…
I am here to tell you that you CAN buy property, regardless of any of the above.
In this day and age, there is absolutely NO reason why anyone can’t own their own home. The strict days of the 20%-down-excellent-credit-and-stable-well-paying-job loans are over, replaced by no-down-payment-prior-bankruptcy-and-stated-income loan programs.
With the wide array of today’s diverse lifestyles comes an abundance of opportunities and programs created for each and every possible situation. Businesses need to make money, and the best way to open themselves up to a larger range of customers is to offer services for the vast and varied circumstances of each individual.
Many lenders today offer little to no down payment programs, poor credit leniencies and even no proof of employment or salary requirements (in lender speak, it’s called “stated-income programs” where you simply state your income to the lender without having to prove it with pay stubs, W2′s, etc. This is widely used by freelancers and consultants).
In addition to the countless programs offered by lenders, there are now government grants and (often free) services available for the low-income, low reserve home buyer as well as plenty of programs for first time home buyers. Government programs and many private loan programs also offer assistance for closing costs (the costs required up front to pay for lender fees, escrow & title charges, etc.), with some programs requiring the seller to pay for most of them.
For a list of government grants, go to http://www.cfda.gov (The Catalog of Federal Domestic Assistance) or http://www.firstgov.gov (The US Government’s Official Web Portal). Click on “Benefits & Grants” to get to their grants page.
“Ok, that’s great,” you’re thinking, “but the real estate market is so inflated now, even if I could qualify for a loan, how am I going to afford a house in the neighborhood I want?”
Welcome to the wonderful world of foreclosures, tax auctions and rehabs (otherwise known as fixer-uppers)! It is a myth that all foreclosures and tax-defaulted properties are in poor, run-down neighborhoods. One good thing about foreclosures and tax-defaulted properties is their indiscrimination. They occur in gang-ridden crack neighborhoods, middle class neighborhoods and elite million dollar communities alike.
Another benefit is that they are generally much cheaper than the lowest priced house in the same neighborhood. We all know the difference between retail and wholesale. You could go to the mall and buy a shirt for retail at $20 or you could go to the garment district in the city and buy the same shirt for wholesale at $10, or better yet, with the advent of the internet, you could do all your wholesale shopping online in the comfort of your pajamas.
The same is true for real estate. If you wouldn’t spend that extra $10 dollars to buy a shirt at retail, why would you spend an extra $10,000 (or usually more) to buy a house at retail?
In the industry, houses that are listed on the market are considered retail. Houses you find through foreclosures and tax auctions are considered wholesale. These are discounted houses, available at a low price for a quick sale, usually because the Bank or County is seeking to simply make back the money they’ve spent on it before (and after) the buyer defaulted. This equals to huge savings for the educated buyer.
Rehabbing is buying houses that are a little less than perfect and fixing them up, either to sell for a profit or to keep as a residence. Some people enjoy the challenge of buying a property that needs a complete overhaul (new roof, extensive remodeling, structural fixes, etc.) while others prefer a “cosmetic fixer,” a house which needs a little touch up paint here and there, some flowers planted in the yard, maybe even a new kitchen countertop, etc.
Cosmetic fixers are a fun and easy way to make money. You get to do a little artistic handiwork (even if you’ve never done it before) and make money at the same time. The quick profits you yield can be rolled over into a bigger and better house, you can repeat the process over and over again, working your way up from a $50,000 house to a $500,000 house within a few years – and the best part, it’s all tax-free!
Called a “1031 Exchange,” the gains you receive from selling the house can be tax-deferred as long as you continue to buy an equal or higher priced house with the proceeds you make from the sale. Unlike a straight sale of a residence, there are no occupancy requirements or live-in time restrictions for a 1031 Exchange. For a residence, federal law states that you must live in the home for 2 out of 5 years of ownership in order to avoid capital gains tax. You may choose to live in it for 2 years and bank the proceeds – yes, tax free! – or you may choose to flip it and do a 1031 Exchange – yes, tax deferred!
If you’re sitting there scratching your head, thinking all this sounds like too much work when all you want is simply a house to call your own, chances are good you can still find a great deal in the retail market as well.
If you are convinced, or even slightly convinced that you just might be able to buy a home after all, here are some steps for the average, traditional home buyer.
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The first step is to figure out how much you are willing to spend. Get your finances in order by evaluating your current total monthly income against your current total monthly outgo. If you are paying $800 in rent now, how much more can you afford per month? If you don’t want to pay any more than $800 a month, but really can, I urge you to look at the bigger picture. Is it worth it to spend a little more per month now to ensure you have an investment that could reap significant returns for you a few years later? Is it worth it to invest that $800 a month (and a little more if necessary) into YOUR future prosperity and not your landlord’s? Is it worth it to live without Direct TV or 100 cable channels or 3,000 cell phone minutes in the short term to invest in your financial freedom in the long term?
Be careful not to overstretch, however. You still want to enjoy your home without cursing it for breaking your bank. Depending on your financial situation, it may not be necessary to cut costs or stretch to purchase a home, but if so, what is owning your own home worth to you?
- The second step is to find the right lender or broker. You need to find a lender/broker so that you will know how much house you can afford. They will tell you how big of a loan you qualify for, based on your income vs. your debt (debt-to-income ratio), how much the monthly payments will be approximately, and how much your upfront costs will be, if any.
- Once you find the right lender, the third step is to find an agent. As a buyer, you do not pay an agent. The agent makes a commission from the seller’s final price. The commission (usually 6%) is split between the buyer’s agent and the seller’s agent (and their broker). If you can, be your own agent. If you find a house you like on your own, you can often offer the seller a lower price since they won’t have to pay part of that to the agents and can afford to lower the price for you. Sellers usually factor in the agents’ commissions when setting their asking price.
- The fourth step is to get to know the market. Knowing what to buy, when to buy and where to buy is key to making money in real estate. Watch the market, talk to agents, sellers, buyers, investors, anyone who might know the neighborhoods you’re interested in. Be open to neighborhoods you haven’t thought of or heard of. Your agent can help you with this too. If you have found a good agent, they will share with you their knowledge of the market based on their experiences being in it every day.
- Know what you want and why. There are numerous ways to make money in real estate. They range anywhere from simply buying low and selling high, to rental income property, to purchasing notes and certificates, to the aforementioned ways and more. Do you want to make a quick, instant million? Or do you want a modest but steady stream of income to be comfortable? Or do you just want to buy a house to live in, a house your children can grow up in? Study your options and go with the one that appeals to you regardless of whether you know anything about it and whether you think you can do it or not. Find your niche in the market and follow it.
- Learn from others who have done it. If your knowledge is insufficient due to lack of experience, let someone else’s experiences guide you. Take courses, read books, talk to others who have led the way and have achieved success in what you want to do. Don’t listen to anyone who hasn’t done it themselves, especially ones who tell you that you can’t. “Borrow” someone else’s knowledge until you gain your own through experience. There are a lot of materials out there to get you started.
Above all, the BEST thing you can do for your success is believe in yourself, believe it CAN be done and go out and do it! Stop wasting your time making up excuses why it CAN’T be done and start spending your time more effectively by finding ways it CAN.
Teresa Franklyn is author and publisher of The Daily Dose, a popular inspirational online publication. When shes not passionately typing away at her computer, she enjoys investing in Real Estate for fun and profit. For more information and helpful links about how to get into Real Estate, visit her website at http://www.followyoursoul.com. To read about her adventures as an Owner/Builder, visit her Blog at http://followyoursoul.blogspot.com
Author: Teresa Franklyn
Article Source: EzineArticles.com
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How to Buy Real-Estate Using No Money Only Contracts
When you have no money and you want to start investing in real-estate. What do you do? You have options, most people believe that you can only buy real-estate if you have a huge amount of money. Buying real-estate isn’t just for the rich. They are wrong for telling you that. You are not stupid for thinking that you can make money buying property without money. I did it.
What contracts are worth enough to buy a house or property without money?
The answer is a contract with the right terms, and the right clauses. See its called deal making for a reason. You are making the deal. Work smart not hard. What are you supposed to do though? Your are no lawyer! Maybe you don’t even know the first thing about writing a contract! That’s ok, I didn’t when I started. Now I do. How did I get there? Well lots, and lots of reading good solid information. I listened to the people that have already accomplished what I wanted to! After I read what they had to offer, I used that knowledge to begin learning, and implementing what I learned. At some point you will need to try it. Nobody can be a seminar junky forever.
What can help me write short sales, contract for deed, quick sale contracts?
There are many programs around that can help a beginner write a good strong contract. However, In my experience there are not any programs that can live up to the abilities of one. This program has stood the tests of time. I don’t speak legaleese. I don’t know how to write contracts, I don’t have magic clauses, and terms memorised, but I buy property no money down all over the place. There is a method that can teach you to do the same. A formula that works, and if you learn the way you will have the ability to buy real-estate too! It is easier then you think I am doing it and I am no different then anyone. I just have good information!
Check out the 3 steps to every contract you will ever need How to buy using no money only contracts.
When you have no money and you want to start investing in real-estate. What do you do? You have options, most people believe that you can only buy real-estate if you have a huge amount of money. Buying real-estate isn’t just for the rich. They are wrong for telling you that. You are not stupid for thinking that you can make money buying property without money. I did it.
What contracts are worth enough to buy a house or property without money?
The answer is a contract with the right terms, and the right clauses. See its called deal making for a reason. You are making the deal. Work smart not hard. What are you sposed to do though? Your are no lawyer! Maybe you dont even know the first thing about writing a contract! Thats ok, I didn’t when I started. Now I do. How did I get there? Well lots, and lots of reading good solid information. I listend to the people that have already accomplished what I wanted to! After I read what they had to offer, I used that knowledge to begin learning, and implementing what I learnd. At some point you will need to try it. Nobody can be a seminar junky forever.
What can help me write short sales, contract for deed, quick sale contracts?
There are many programs around that can help a beginner write a good strong contract. However, In my experiance there are not any programs that can live up to the abilities of one. This program has stood the tests of time. I don’t speak leagaleese. I don’t know how to write contracts, I don’t have magic clauses, and terms memorised, but I buy property no money down all over the place. There is a method that can teach you to do the same. A formula that works, and if you learn the way you will have the ability to buy real-estate too! It is easier then you think I am doing it and I am no different then anyone. I just have good information, great tools, awesome programs!
Check out the 3 steps to every contract you will ever need http://www.squidoo.com/TheContractWizard
Author: Andrew Rider
Article Source: EzineArticles.com
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What to Look For When You Buy Your First Apartment Or House
I still remember buying my first apartment. I didn’t know anything about the real estate market, or what I should be on the lookout for. The entire purchase decision was based on my emotions towards the apartment, and the surrounding area. However, as timed passed on and I began to learn more about the real estate market, I quickly discovered that the purchase was not as good as it had at first seemed.
Buying property, especially when it is your first apartment or house, can be complex and time consuming. Many people see it as an important investment because they define it as an investment for a lifetime. After all, you will most likely live in it. That was what I also thought back then. However, as timed went on, I learned that buying property can also be a financial investment. It all depends on what you are buying the property for: To live in it, or to generate a passive cash flow.
When buying a house or an apartment, avoid basing your decision solely on the same standard I did. Namely looks. It is important to consider other factors as well. For instance financial risks and benefits, the market, cash flow and tax laws, to name a few. Financial factors are important and must always be considered. You should also take a closer look at both the pluming and electric system. After all, repainting the apartment will only costs a few hundred dollars, while changing the entire electric system can cost you more than $30.000. Don’t become a victim to these mistakes. You will regret it.
The decision to buy a property should only be done after a due consideration of all financial aspects. There are two main financial analyses that you need to conduct, which will help you decide on whether or not to buy a house or an apartment of your own.
Buy Vs Rent
A good way to start the decision making process is to conduct a buy Vs rent analysis. It is a simple financial tool called the Net Present Value (NPV), which you need to use to find, whether renting or buying, is cheaper. The NPV of the house is calculated and equated to monthly figures, which can then be compared with the rentals. There are many NPV calculators you can use for free on the Internet. Just type “Net Present Value Calculator” into your search engine. Except for emotional and social reasons, if you analysis tells you not a buy a house, it may not be worth taking all the trouble to buy one after all.
Financing the purchase
Have you saved up enough money for the down payment of the property? Can you pay the monthly installments for the mortgage? These are questions you need to answer before you decide to buy. Even if you have decided on a budget, do a recheck and add all other expenses that might have been missed. You need to account for maintenance and property tax as well. Do the analysis systematically and on paper so that you get to see all the figures. Only buy if you are convinced that you can pay off the mortgages without defaulting.
Buying your first house or apartment is a dream comes true for most people. Some people see it as an investment in their lifestyle, while others see it as a financial investment. No matter your reason, understanding both the financial and non-financial parameters is vital. It is up to you whether you choose to invest in your current lifestyle, or the one you want for yourself in the future. With that being said, you should now be able to avoid the mistakes I did, and embark on a real estate adventure of your own.
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Author: Oyvind Eriksen
Article Source: EzineArticles.com
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Top Tips For Buying That Home Today!
When a buyer wants to buy a home, they want the property that will feel really hospitable. The neatness, tidiness and satisfaction can only be felt by the buyer. There are some important things the home buyers should know that might prevent them from buying a home. This can be by judging on the outer appearance and features since the inner features are what matters most.
If you are buying a home for the first time, they have to ensure that they have looked at the home thoroughly. This includes knowing all about it to avoid new and unpleasant findings later when they have moved in to the newly bought home. When the home buyer is about to buy their home, they should always be accompanied by a qualified evaluator. This evaluator assists the buyer in getting the home that is worth their money.
This qualified home evaluator is very essential more so when the buyer is buying a home that has been previously occupied. In most cases the old homes are sold at more than what they are worth and many banks do not give loans to buy a home that is priced above its worth.
One more thing a home buyer should know is to avoid being enticed by the decorations on the home. This is because the buyer might be pleased with a tiled floor whereas the walls have been painted pitch black. While negotiating with the owner, the buyer should ensure they put across that they will have to paint the walls again.
Your important guideline to the buyer is that they should never give more than they can afford to buy a home. Having the assurance that you will get a loan from the bank should not make the buyer buy a house for more than they can afford. Banks can give buyers large loans that will leave them in positions where they will not have money to do many other important things.
Buying a home at times affects the emotions. When the buyer has found a good home for their family, they might be affected by the environment. A home evaluator and some important factors to note before buying a home assist a buyer make the right decision which they will never regret.
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Who pays the real estate agent when a foreclosed home is purchased?
We are looking to buy a house. We found a real estate agent before we found the house we really want. It’s a foreclosed home. How does the real estate agent get paid?
Knowing When You Are Ready to Buy Your Home
Making rational decisions is not an easy task but the one thing that could help you the most would surely be information and knowledge and that is what this article can give you about real estate buying.
This is just the opening of the article about real estate buying and if you want to gain knowledge about real estate buying, do not miss reading this article.
All across the United States, there are millions of people looking to a buy home – either now or in the future. Over the last few years, lower interest rates have come along, making it more affordable than ever to buy a home. When most people stop and give it some thought – buying a home makes a lot more sense than renting a home or an apartment.
An article is incomplete without its readers and that is why it is essential that readers are satisfied with articles. We have tried hard to achieve this very purpose. And now it is for you all to judge.
When you are looking to buy a house, you’ll need to have enough money for the closing costs and a down payment. Your down payment will normally need to be around 15% of the price or the value of the property – whichever is lower. To be on the safe side, you should always try to have 20% to put down. If you aren’t able to put 20% down, you’ll need to buy some private mortgage insurance, which will cost you more in terms of your monthly payment.
Now when you are the half way mark of this article on real estate buying, we are more than sure that you would be completing this article and that is what would be the most satisfying for us.
Usually, the closing costs will be around 5% of the property price. Before you buy the home, always get an estimate beforehand. An estimate won’t be the exact price, although it will be really close. You should always plan to save up a bit more money than you need, just to be on the safe side.
If you were skeptical in reading this article thinking it would be the same run of the mill stuff about skeptical, you must now be confirmed that it is not the case here and that you should continue with the article.
You’ll know that you are ready to buy a home when you know exactly how much you can afford, and you’re willing to stick with your plan. When you buy a home and get your monthly mortgage payment, it shouldn’t be any more than 25% of your total monthly income. Although there are lenders out there who will say that you can afford to pay more, you should never let them talk you into doing so – but stick to your budget instead.
Remember that there is always more money involved with a home other than the mortgage payment. You also have to pay for utilities, homeowners insurance, property taxes, and maintenance. Owning and caring for a home requires a lot of responsibility. If you’ve never owned a home before, it can take a bit of time to get used to.
Before you fill out any applications, you should always look over your credit report and check for any errors. An error on a credit report is not uncommon so, look out for it. If you have an error on your credit report, it can cost you a lot of money in interest rates. An error will decrease your credit score, which will put you in a higher interest bracket and ultimately cost you a lot more money in the end.
If you check your credit report early enough, you may leave yourself enough time to fix any problems and get your credit back on track. Rebuilding credit can take time though, sometimes even years. You should always plan ahead – and give yourself plenty of time to fix your credit.
Buying a home requires a lot of commitment on your behalf. You should always strive to get the best possible deals, which means knowing your credit and where you stand. This way, you can get the best interest rates. You don’t want to buy a home with bad credit, simply because you’ll pay a lot more money for the home. If you take the time to fix any credit problems and save up some money – you’ll be able to get a much better home for your money.
We don’t claim that we have provided you with the best possible article on real estate buying but what we claim is that we have tried our best to provide you with a good article with pertinent content.
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