“Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”

This is good advice as long as you don’t get so spread out that you are doing too many things but nothing with success. It’s important we understand the fine line between focusing on one niche without putting all your eggs in one basket, (so to speak).

To simplify the term real estate investing, there are really only three ways for investors to make money in real estate:

1. Real Estate Appreciation and Equity
2. Cash flow while you own it
3. Assignments: Payment when you flip a real estate contract without owning it.

So where do you start? Let’s try to answer this question on every aspiring real estate investors mind. Since real estate investing encompasses so many types of exit strategies or I like to call profit centers, it’s important to study and pick those you are most passionate about. In my Coaching U2 Profit Your Way training I thoroughly teach on over 24 profit centers, otherwise called exit strategies. The following is a summary of ten of the most popular real estate investment strategies with their advantages and disadvantages.

1. Rentals or Cash flow Investment Property: These types of investment properties are the ones which generate rental income. These are mainly apartment buildings and rental houses.
• Advantages: One of the easier ways to get started, and good long term return on investment while also earning monthly income.
• Disadvantages: Risk of not renting property leaving you with the mortgage payment and no income. Property management can be a challenge. You typically will wait awhile to sell your property so payoff is slow.
2. Lease Option. This is when you buy a property, then sell to someone else via a rent-to-own arrangement.
• Advantages: You get higher rent, and the buyer is usually responsible for maintenance. Cash flow can be good.
• Disadvantages: Most rent to own buyers don’t complete the purchase (this can be an advantage too, but it does mean more work for you). Bookkeeping must be done properly and can be complicated.
3. Fixer Upper Investment Property. These types of investment properties are the ones which are in ugly condition and need renovation. These properties can be acquired to flip after fixing-up quickly or held to rent out.
• Advantages: You can receive a quick return on your investment (months). You usually get below market value pricing on properties bringing you instant equity.
• Disadvantages: Higher risk. (Many unpredictable expenses come up in construction). You get taxed heavily on the gain when you sell in under a year.
4. Vacant Land. Many options including just holding while appreciating. You can also split it and sell it.
• Advantages: History has shown that land always appreciates in value (it’s the buildings on the land that go down. It is simpler than most real estate investments, with the possibility of great profits.
• Disadvantages: It can take a long time to increase in value. You have expenses, but no cash flow while you wait unless you sell the contract before closing.
5. Commercial Real Estate. These are any building containing 5 units or over and/or buildings sited for commercial use.
• Advantages: Long term triple-net leases mean little management and high returns. Lending is usually based on the value of the property vs. personal credit.
• Disadvantages: Commercial property valuation requires a more complex method, taking into account the income potential of the property. This is recommended for the more experienced investors as there is a lot more involved to set up and maintenance.
6. Buy property with Forced Appreciation. Buy in the path of growth and holding until values rise. For instance buying a lot in a residential development prior to roads being completed.
• Advantages: Can yield large profits, especially if you buy low to start.
• Disadvantages: Future price is not predictable – the market can turn, the developer can go out of business. You have expenses with no income while you’re waiting.
7. Preconstruction Investment Property: These types of investment properties are acquired directly from a developer before the construction or renovation is completed.
• Advantages: Low money out of pocket to tie up property while being built. If purchased in appreciating markets, you make money in equity at closing and can instantly re-sell at a profit.
• Disadvantages: You can’t always predict what a market is going to do. If market depreciates, you have lost money. Also higher tax rates in selling quickly.
8. Pre-Foreclosure Investment Property: These types of investment properties are the ones which you buy from sellers who are behind in their payments and may lose their property to the bank via foreclosure.
• Advantages: You have opportunities to buy properties at below value pricing – “Instant equity”.
• Disadvantages: Legal liabilities are higher. Finding these properties requires a lot research and footwork to find a deal that works. You can do all the work and still not have a deal with enough equity to profit after expenses to sell, (taxes, realtors, etc).
9. Assignments: This strategy has you get into a property at a discount, preferably with a known buyer in place before you commit to your purchase. After you are in contract to purchase a property, you would sell your contract for a fee to someone else. For example you get into purchase contract to buy a $120K property for $100K. You turn it to an investor for $110K and profit $10K cash without the cost and hassles of ever closing on the deal.
• Advantages: This is a great way to make quick cash with low or no upfront investment, low risk and fewer headaches from closing and ownership. This strategy creates a win win win outcome for everyone involved.
• Disadvantages: This will only work if the property you are buying has equity so that you may buy it a discount. In declining markets, this type of property is harder to find. Also when dealing with banks on REO’s or Short Sales you will find they will not allow you assign your contract. However, there are ways to get around this if you plan and handle the contract correctly up front.
  Do you want to know how I have managed to get around not being able to assign a contract? I have purchased properties in the name of an LLC set up exclusively to buy properties. I then sold the LLC to someone, making them the owner of the LLC, therefore making them responsible for closing on the purchase contract and end buyer of the property.
10. Flipping - Wikipedia defines Flipping as is a term used primarily in the United States to describe practice of buying an asset and quickly reselling (or “flipping”) it for profit ..

This description pretty much explains property flipping, with there being a slight difference from that description of flipping assets. In real estate you can get into an agreement to flip a contract you have gotten into before you even buy it. This can be done with ease when you know exactly what your buyers want and with no money out of your pocket utilizing transactional funding. Flipping can also mean closing and quickly reselling your property, sometimes even doing both transactions the same day – this being subcategorized a “double closing”.

• Advantages: My favorite strategy. You work the deal backwards. You create relationships with buyers who can close quickly with cash, (I mentioned earlier there is a system that does this for you at www.CashBuyers4Flips.com ). Then you find a property meeting the needs of your buyers. This strategy allows you to profit literally from no money down, with lower risk and very little of your own time.
• Disadvantages: The law requires you to disclose your intent to resell quickly to sellers. When dealing with banks, this can sometimes cause your offer to be rejected. You must buy properties in the name of an LLC in order to utilize transactional funding. Setting up and maintaining an LLC will cost you money. Though the intent of a buyer might be to close on the transaction, sometimes “life happens” and something causes the buyer to be unable to follow through. You may have to walk away from earnest money if you cannot find another buyer quickly

Now that you that you have learned strategies to consider, you will need to consider the type of properties you want to go after, developing a marketing strategy to find motivated sellers of those deals. Over the next months I will be sharing steps and strategies on how to profit investing in real estate 12 different ways.

Please leave a comment if you have anything you would like add to what I have written here with the heart to support fellow real estate investors. (Any solicitations for business will not be published) I appreciate the feedback!

Definition: The delinquency is added to the loan balance in order to bring your payments up to date. Adding past due loan amounts to your current loan balance increases your loan balance and will also increase your monthly payments. The amount of the payment increase will be smaller if the life of your loan is extended at the same time as well. This is a good option if the reason for your mortgage default was temporary and your future income will support the new payment.

Go here for more Foreclosure Coaching

Originally posted 2008-06-16 13:20:46. Republished by Blog Post Promoter

The other night, Virginia from Irving Texas asked on this weeks Massive Profits in Foreclosures call “ Will this change the landscape for investors working with those in Foreclosure?”

The Answer is YES- – -for the better.

You be the good person to help the homeowner make sure they have evaluated all their options.

These are two ways you can help the homeowner take action before foreclosure:

#1 Learn and share all options available to the homeowner if they do not want to sell their house. You can find those in this book, ‘Avoid Foreclosure Following the SMART STEPS Plan’.

#2 Make sure they have done all they can with Project Lifeline.

This project allows you, as the investor, more time to work with homeowners on a plan to buy their house should the bank’s option not meet the homeowner’s needs.

What is Project Lifeline?

The program would let qualified homeowners who are at least 90 days late on their mortgage payments pause the foreclosure process for 30 days. During the extra time provided by the program — called Project Lifeline — lenders and borrowers would try to work out more affordable terms.

“Project Lifeline is aimed at homeowners who face a real risk of losing their home and have not yet addressed the problem,” he told reporters. “Perhaps they are hoping to find a way to get current on their mortgage payments, or perhaps they don’t think any solution is possible. For whatever reason, they have not yet taken action. Our hope is that today’s announcement will reach them, and they will reach out immediately for help.” Secretary of the Treasury Henry Paulson.

On a pilot basis, the plan involves only six of the largest mortgage lenders, in hopes that more lenders will sign on. The participants are Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc. and Wells Fargo & Co.

“Achieving contact with homeowners to present available options is the biggest obstacle we face in avoiding preventable foreclosure,” said Bank of America’s Floyd Robinson.

You can help the banks biggest obstacle by making sure anyone you talk to in foreclosure knows about Project Lifeline. This means you will be working with those in foreclosures with the “integrity and passion”. Remember to encourage the homeowner to contact you first to buy the property if things are not worked out with the bank. And wish them the best. It’s the right thing to do.

Tamera Aragon
Success Trainer and Coach
Ispiproperties.com

Originally posted 2008-02-14 08:17:22. Republished by Blog Post Promoter

(FHA mortgages only) (Some Freddie Mac Investor loans)

Definition: This is a loss mitigation option that allows a borrower, with help from a lender, to get an interest-free loan from HUD to bring their mortgage payments up to date

You may qualify if:

1. Loan must be 92 days delinquent (4 full payments due and unpaid).
2. Mortgagor must have overcome the cause of default.
3. Owner-occupant committed to continuing occupancy as primary residence.
4. You are able to begin making full mortgage payments.

When your lender files a Partial Claim, the U.S. Department of Housing and Urban Development will pay your lender the amount necessary to bring your mortgage current. You must execute a Promissory Note, and a Lien will be placed on your property until the Promissory Note is paid in full.

The Promissory Note is interest-free and is due when you pay off the first mortgage or when you sell the property.

For more information on this option you may contact:

National Servicing Center

Email: hsg-lossmit@hud.gov

1-888-297-8685

http://www.hud.gov/offices/hsg/sfh/nsc/rep/pcfact.pdf

For more information and coaching: Avoid Foreclosure eBook

Originally posted 2008-07-01 11:35:24. Republished by Blog Post Promoter

Hope for tomorrow….

These words are from a “tag line” I used to put under my real estate investing business name.

“Support for today, hope for tomorrow.”

Even though I don’t use that tag line any more, it is still the basis for all I do.

Now more than ever, I plan to continue to support others with all that I have to offer and in the process, providing hope.

I know this is last minute – but some extra seats just opened up.

I wanted to give you an opportunity to receive a free trip and free training when you join me in Las Vegas this coming Sunday, April 10^th.

www.investorcommunityofcentralvalley.com/treasurehunt

What’s this got to do with hope? Well, I think the biggest financial hope is investing in profitable real estate today.

What does hopeful  real estate investing look like?

You want to buy greatly discounted properties… resold quickly for a huge profit to you!

• But how do you get the properties at a discount?
• How do you sell quickly in this crazy market?

If you really want to know how it is being done today, then I hope you will consider flying over to Vegas with me on Sunday, April 10^th.

Yes – FREE TRIP AND FREE TRAINING – on how to buy and quickly flip properties on the Court steps.

NO UPSELLS~!   This trip offers “watch and learn” free training on what I think is the best way to profit from flipping in today’s market.  I am so excited about this system; you will be able to watch as I am personally investing my money this weekend myself.  I think this is the fastest, easiest way to get properties purchase for bottom dollar and sold at top dollar fast.

When you come to Las Vegas, you will see how it is done as the pros do the evaluating, buying and selling for me – right before your very eyes.

To good to be true?  Find out it IS true- when you come!

www.investorcommunityofcentralvalley.com/treasurehunt

Don’t you agree….this is the best time to let me help you quick flip as many houses you can?  Join me for a super exciting Las Vegas trip that’s guaranteed to be lots fun and should be a huge moneymaker for you too! The foreclosure bus takes you straight to the deals!

Your super fun moneymaking Las Vegas trip is really free! Your trip includes your 2 nights at a popular hotel in Vegas…along with your personalized Las Vegas foreclosure treasure hunt tour, including a trip to the court steps during an auction to see how it is done.

It’s easy and it’s fun!  And FREE!

You still have time to BOOK YOUR FREE LAS VEGAS TRIP FOR THIS WEEKEND NOW – only 6 more seats left on the bus.

You have everything to gain and I think nothing to lose when you take time to join me in Las Vegas for this complimentary Las Vegas foreclosure treasure hunt. Space is limited and these Las Vegas foreclosure treasure hunts are almost always filled to capacity.

I look forward to us making lots of money together. If you are interested in joining me, go here to sign up today… www.investorcommunityofcentralvalley.com/treasurehunt

Once you sign up, we will get right back to you to set up all the details, assisting you with reservations for your Las Vegas foreclosure auction quick flip trip.

To Your Success!

Tamera Aragon
www.investorcommunityofcentralvalley.com/treasurehunt

Originally posted 2011-04-07 13:57:12. Republished by Blog Post Promoter