o you think the real estate market is finally starting to go up and NOW is the time to start investing. Well you may be right but here is the hard part: how do you pay for your investments. This is THE issue that makes or breaks your ability to be a real estate investor. Prices are down as much as 30% in some areas and opportunities are available in every neighborhood, but without money you cannot take advantage of these great prices.

Unless you are going to owner-occupy a property, you will be required to bring 30% to 50% as a down payment to closing. Do you have that kind of cash? The days of 5% to 10% down payments are gone. This is the new realty of todays real estate market.

Additionally, most of the great deals today involve distressed properties that may need work. This work also cost money and you have to be prepared to fund these extra costs. These may included small repairs, fresh paint throughout, new kitchens or bathrooms or new carpets. All these cost money.

If you want to buy a $100,000 deal you will need $30k to $50k upfront. Then you will need at least $10k to fix up the house with fresh paint, carpet and small repairs. Can you afford this?

So now that you know how much you will need to purchase your real estate investment the question is how you are going to finance this amount. Here are a few options in the current market:

* Traditional financing: Local and national banks, as well as mortgage brokers, are still going to be the best source for large-sum and long-term lending on anything four units and under. Expect to pay around 25% down, but interest rates should continue to be well under 7% for the foreseeable future. Make sure you talk to at least one mortgage broker and as many small local banks as possible before settling on a lender.

* Lines of credit: Pulling out equity from your home or other investments should be done with caution, but is a great way to free up funds. Many investors buy and repair properties with cash from a line of credit, with the intent of financing the finished product six months or so after purchase. You should always check with your lender before taking this route, but it can be a great path to affording multiple properties in a short period of time.

* Hard money lender: If you are looking for short-term money to leverage a property while you do repairs, this remains a viable option. Interest rates and fees are generally higher and hard money is currently less available than in years past, but if you develop a successful relationship with a hard-money lender it can really add a lot of flexibility to what kinds of projects you can take on.

* Private lending: Technically, most hard money lenders are private, but I am referring to the type of money that comes from a less seasoned source. Someone like a family member, friend, or even an acquaintance with the desire to invest their money. This kind of money relies mostly on your own personal network, but if you can find a backer with deep pockets, you can both benefit greatly. Since you are generally not competing with other investors for these funds, this money can be more reliable and flexible as well.

* Partnership: In many ways a partnership is a more formal and permanent form of private funding. Instead of just borrowing money under certain terms from someone, they actually have a stake in the property itself. Whether you split profits 50/50 or 75/25, if you need help with managing your investments and/or paying for them, finding a partner can be a great way to open up your options.

As the real estate market continues to improve more and more people will start to come back into the market and as a result prices will start to go back up. Now is the time to get into this market before that happens. These future price increases should be your equity. But you need to get over the financing hurdle.

If you would like more information on this topic or to learn more real estate investing tips, ideals or “real world” investing strategies please go to my blog at http://www.learnrealestateinvestingblog.com/.

Mike Lautensack is a full-time real estate entrepreneur, coach and mentor in Philadelphia, PA and creator of the Private Lending Presentation Kit. This powerful done-for-you kit is loaded with tools and techniques to attract and develop a consistent stream of private investors into your real estate business. To learn more about this kit and receive your FREE eBook go to Real Estate Investing Blog.

Have you ever thought that with a little help from a experienced coach might help your real estate investing business take off? Consider a mini-coaching session by going to http://www.realestatewealthtoday.com/MiniCoaching.html

Popularity: 86% [?]

About Go Homing Real Estate Owned Property Auctions
Welcome to GoHoming.com, an online bidding marketplace for buying and selling Real Estate Owned, or REO, homes. REO homes are properties that owners, such as banks or lenders, were unable to sell the property at the foreclosure sale. We’ve helped market and sell thousands of properties per month through exclusive relationships with sellers, and we’re one of the most credible and recognized teams in the real estate industry.

At GoHoming.com, we’re proud to be part of Altisource Portfolio Solutions (ASPS), a company with an impressive track record in the REO homes industry. We’re fortunate to have a senior leadership team made up of the top experts in online and product marketing who have significant experience building and servicing many successful online real estate products and brands. Based on what we’ve learned over the years about the process of buying and selling homes, we’ve built GoHoming.com using our proprietary tools and technologies to manage our customers’ online auctions and online marketing solutions.

GoHoming.com gives the average home buyer a place to bid on REO homes for sale through online Time Limit and No Time Limit bidding formats. A Time Limit bid format allows the owner of the property to set a time limit on the sale. There’s also a minimum bid, or offer, and a reserve price, which is not displayed online. The reserve price is generally the lowest price at which the owner is willing to sell the property. A No Time Limit bid format is similar to the conventional real estate sales process where buyers make offers and sellers can make counter offers until a deal is made. A unique benefit to purchasing a home on GoHoming.com is that you can see what other people are bidding for a property and what the highest bid is. That way, you know what the competition is and can feel confident that you’re getting a fair market price.

When you search for REO homes for sale on GoHoming.com, you’ll see that we provide as much information as possible to help you make an informed decision, including detailed descriptions, photos, features, prices and additional fees, as well as important documents and data associated with the properties all at no charge to you. We come from a long line of customer service professionals and are dedicated to providing a high level of service to our online customers through methods such as online tutorials, live chats with agents, and email notifications.

Through our relationship with Altisource Homes, we’re also able to offer a fully integrated property management solution for sellers. And through our partnership with Ocwen Financial Corporation, we’re able to provide thousands of real estate listings from California to Nevada to Florida and all across the country, giving buyers more choices and sellers more prospects. It’s a win-win situation for everyone.

To learn more go to http://www.gohoming.com/

Popularity: 95% [?]

After watching prices fall for years, people are asking, “Is real estate a good investment now?” Of course, like most classes of investments there are opportunities even in the worst of times. Even as the stock market crashes some stocks go up in price, after all, and even while some people lost money buying houses in the last few years, some made money. The better question, then, is “Which real estate investments are best right now?

Perhaps the worst kind of real estate investing is the purely speculative bets on rising prices. This is what we saw all over Tucson Arizona up until we moved from there in June of 2006. Homes had been appreciating at 20% annually for several years. many people began to buy them even if after rent was collected they lost $500 or $600 per month. After all, you might not mind paying out $7,000 in negative cash flow on a $200,000 house if you get to sell it for $240,000 a year later.

As we left town the bubble was about to burst. The fact that 11% of all houses sold were to speculative investors should have been a clue that much of the demand that drove prices higher was artificial. This kind of “buy and hope prices go up fast” investing is dangerous in the best of times.
Making Real Estate A Good Investment

On the other hand, if you were to buy a fixer upper at the top of the market, you could have made money even as prices fell. For example, suppose you bought a house that would be worth $200,000 when prepared, and because it was trashed you only paid $130,000. If all of your repair costs, holding costs and other expenses came to just $35,000 , you might have been looking at a $35,000 profit. Now, if prices fell by 10% and you could only get $180,000 for the home, you would still make $15,000.

Fixing and flipping a house can be a good real estate investment much of the time, even in a weak market. The key here is to buy right and move fast. Time cost money not only because of the interest, utilities and other expenses you’re paying, but also because of falling prices.

Another way to make real estate a good investment now is to invest in properties that produce positive cash flow. If you are making money with it every month it doesn’t necessarily matter whether the sales value of a house goes up or down. Let’s look at a simple example to show how important cash flow is. Suppose you buy a home for $100,000 with a $10,000 down payment, and you net (on average) $150 per month for 30 years while renters pay off your mortgage. You’ll have made $54,000. What if you bought in the one place where values dropped for thirty years and the house is worth only $60,000 now? You can pocket that too, and have made a total of $114,000 ($54,000 + $60,000) from your $10,000 investment.

What’s more, rents probably went up. Though there are some places where property values have dropped for decades, I have not heard of a place where rents didn’t rise in 20 or 30 years. Perhaps you are making $300 cash flow towards the end of the thirty years, and then when the loan is paid you are making an additional $600. Making $900 per month, or almost 11,000 annually on an original investment of $10,000 isn’t all that bad, even if the home is worth 40% less. Cash flow makes real estate a good investment even during the worst price declines.

One more thing to keep in mind, since we all would rather have cash flow and appreciation: Not all areas are the same. We bought a small home in Colorado after leaving Tucson. We closed in June of 2006, which was close to the top of the market. A month ago, in June of 2009, we sold the house for 11% more than we paid. That only meant breaking even after all the costs of the sale, but it does show that the real estate market is not the same in all places nor with all types of properties. In many areas (including here) prices fell at the high end while staying the same or even rising on the lower-priced homes.

So is real estate a good investment now? It is if you make the right kind of investments and in the right places.

Popularity: 84% [?]

In a recent survey completed by Rentbits.com of 1000 people were who were in the process of finding a rental home, people were asked a series of questions about their process of finding an apartment or house. The results will surprise you.

Apartment vs. House

One of the first surprises was that 83% of people were looking for houses versus apartments. It would seem that people’s interests has migrated away from small apartments towards houses. This change should have some major impact on apartment builders who have been increasing the number of new apartment buildings in 2008. For investors, it should highlight the need for investing in houses versus duplexes, triplexes or small apartment buildings for long term value.

Rental Advertising

Another surprise was the large impact of the internet on how people look for rental housing, with 72% of people saying they start their search on the internet. Over 93% of people visit at least 2 different rental sites during their rental search. Landlords need to understand this trend and start to use the internet to advertise your open rentals. There are free sites such as craigslist and many paid sites that offer great exposure. Pick a few sites and sign up for accounts and get your advertising onto the internet.

This is exactly what we have seen in our business as older methods of advertising, such as newspaper and locator companies, have become less effective in recent years.

We have moved heavily to the internet for advertising to be out in front of this trend.

Key Words

In these Internet searches, people are using search terms that are between 3 to 6 words with “location” and “price” as the primary key words. It is important that people understand the importance of key words in your ads including the city, the zip code, the area code and neighborhood names such as “South Philly”. Be sure to use shorter versions of city names such as “Philly” for Philadelphia. Anything that people might type should be in your ad to be sure to capture as many people as possible with your ads.

Other Terms

After the two most important elements of an advertisement including price and location are a number of additional elements such as pictures, lease terms, deposit amounts, pet friendly and appliance that are important to people. People are looking to “rule out” certain properties if they do not fit their needs. These additional elements allow them to rule out certain houses without having to waste their time or your time visiting properties they will never rent.

We have recently started filming videos of our rental properties, producing a “Virtual Tour”. This tour allows prospective tenants to see a 2 to 4 minute video of the entire property, allowing them to make a decision about renting the property, whether positive or negative, without actually having to visit it. Obviously, this is a huge time saver for both potential tenants and we are finding that everyone gains from the benefits.

Gender Gap

Another surprise was that 82% of respondents were female. Conventional wisdom says that 80% of home buying decisions are done by women. Landlords need to cater to women and make sure your kitchens and bathrooms are the highlights of your property to ensure a quick rental process.

I invite you to learn more about Real Estate Investing and become a member of our FREE weekly tele-seminar class where we teach tips and strategy on how to grow your real estate investing business and how to raise Private Money by going to http://www.realestatewealthtoday.com/TuesdayTipsSignUp.html

Mike Lautensack is a full-time real estate entrepreneur, coach and mentor in Philadelphia, PA and creator of the Private Lending Presentation Kit. This powerful done-for-you kit is loaded with tools and techniques to attract and develop a consistent stream of private investors into your real estate business. To learn more about this kit and receive your FREE eBook go to Real Estate Investing Blog.

Popularity: 93% [?]

Popularity: 95% [?]

There are many methods for building fortunes in the world today. One of the most accessible even for the normal entrepreneur though is real estate investing. If truth be told, you will find many rags to riches stories are built by investing in the real estate promotion in one form or another if not many methods for investing in this lucrative but risky area.

Real estate is a fantastic strategy for the investor who is willing to commit the time to learn about the alternatives, risks, and potential rewards for this form of investment process.

A few of the more popular real estate investments are the next:

1) Rental property: Property ordinarily gains value through time unlike many other investments that may rise and fall rapidly and without alert. The trouble is that far too few people can actually afford to hold and maintain several properties through a generalized and indefinite period of time while awaiting the value to rise. Many property investors deal with to overcome this by renting the properties to tenants all through the time when the property values are rising. This permits the tenants to basically cover the note on the property and makes the venture a little less risky although there are risks involucred when getting involved with tenants (such as property damage, failure to pay the rent, and possible legal woes-the good tenants more often than not outweigh the bad).

2) Pre-construction investment: This is a notably speculative and notably risky type of property investment that has booms and busts. Countless investors lately discovered exactly how risky this endeavor actually is when the property bubble went bust so to speak. The risks involed in this form of investment shouldnt cover up the fact that many millionaires have been created by means of pre-construction investing and many more will be created one day. Pre-construction investing, just as its name implies is a form of investment in which investors pay for options on the property before ground is broken. This is very extended in high demand areas that are known to experience housing shortages as prices often rise rapidly and the units are often sold before they are completed and any real cash exchanges hands.

3) Flipping houses: This is a form of property investment that has produced leaps and bounds in the recent years thanks to the popularity of many popular home improvement and house flipping shows on cable networks in the recent years. A growing number of people have decided to act on this type of investment in hopes of creating enormous profits in a short amount of time and with minimal investment. The trouble, obviously, is that it continually looks much easier on television than it is in person. Couple this with the fact that many people have unrealistic expectations when it comes to bills and capability and there are lots of risks involucred with this form of investment in addition. For those who are successful though, there is the potential for superb profit in a relatively short amount of time as these televisions shows indicate.

4) Buy and Hold: As told above, real estate tends to gain value through time. Even though the buildings are in desperate desire of TLC and fix the land they are standing on is more often than not earning value as the years pass by. buying large plenty of land or even many houses and holding on to them for as long as possible before offering can often fund college educations for children, purchase weddings, or immensely supplement retirement funds. The longer these properties are held the better on many cases as this provides the greatest possibility for the value of the property to increase.

5) Lease alternatives: There are few people in this world who never experience rough spots financially. Many of these people are denied traditional home loans as a result of their inability to cover debts the right way in the past. For this circumstance they are often willing to purchase the privilege of rebuilding their credit while working towards a path of home ownership. For these people, a lease alternative presents a workable and often valued solution. Those investors who are willing to take the risks often find the rewards are well worth those risks.

These are only a few of the investment opportunities that exist for those who are interested in real estate for an investment avenue. There are commercial real estate endeavors that have the potential to bring in tremendous profits and also the development and preparing of housing communities in addition. Obviously real estate investing offers many opportunities to the savvy investor.

Popularity: 94% [?]

The changes in financing options available for residential investment properties over the last 5 years are staggering. Lenders have relaxed the credit and income guidelines for qualification that formerly deterred many would-be investors from entering the real estate. In addition, the down payment requirement has been eliminated for borrowers who qualify. This article surveys the landscape for lenders offering residential investment financing products.

Types of Lenders:

The lender landscape can be broken into the following broad categories:

Conforming
Alt-A
Non-Conforming or Sub prime
Hard Money

Each of these offers loans for residential investment properties ( 1-4 unit properties).

Conforming

Conforming lenders are the A-Paper mortgage banks that cater to borrowers with excellent credit history and the ability to document income. Conforming banks offer loan products that can be considered plain vanilla in todays world of interest-only ARMs and low down payment loans. In terms of investor loans, conforming lenders offer full doc and stated loans up to a 90% LTV. A loan from a conforming lender with an LTV greater than 80% will incur private mortgage insurance, or PMI.

Conforming lenders always require a minimum of a 620 credit score, and use a computerized underwriting process to determine approval. Besides credit score, other important factors for approval include: payment history for mortgage and revolving accounts over the last 24 months, debt-to-income ratio, employment history, amount of down payment, and the amount of liquid reserves.

Some examples of leading conforming lenders are Countrywide, Wachovia, Suntrust, and Flagstar. While these are national lenders, any local bank or savings and loan would fall into this category.

Alt-A

Alternative A credit lenders, or Alt-A, offer aggressive loan financing products catering to borrowers with credit scores from 660 and up. While these lenders offer programs to borrowers with scores down to 620, the aggressive programs are typically not available to borrowers below a 660 middle score. Alt-A banks have driven the creation of innovative loan products over the last few years.

These programs include the many interest-only products, the Option Arm loan, loans requiring as little as 5% and now no down payment, as well as standard fixed-rate and arm products. The big difference with these lenders is the relaxed debt-to-income ratios available, the reduced income documentations (stated income, no income / no asset, and no doc), and the ability to add interest-only to most products. Alt-A lenders have popularized the use of 80-10 and 80-15 loans for investors to avoid PMI.

Some examples of leading Alt-A lenders are Aurora, GreenPoint, SunTrust, First Horizon, and IndyMac. Besides these, there are literally hundreds and hundreds of lenders that have emerged to fill certain niches.

Non-conforming / Sub prime

Non-conforming or sub prime lenders fill a growing niche borrowers with past credit problems. These lenders offer fixed and adjustable loan programs for borrowers with bankruptcies, foreclosures, judgments, tax liens, charge-offs, and many other credit blemishes.

These lenders typically price their loans using a matrix that evaluates credit score in relation to loan-to-value. Sub prime lenders will offer financing to borrowers with as low as a 500 middle score, and even have programs that cater to borrowers with excellent 700+ scores. The sweet spot for most of these lenders is a 580 or better middle, as they will provide 100% financing for owner-occupied properties at that score. For investors using sub prime lenders begin to offer products for borrowers with a 550 credit score.

The important thing to understand about these loans is that they are priced much higher than a conforming or even Alt-A loan.

The most popular product with these lenders is a 2-year Arm, with the idea being the borrower will refinance or sell the property in 2 years. Also very common with these lenders is a mandatory 2 or 3 year pre-payment penalty.

Some examples of leading Sub prime lenders are LongBeach Mortgage(division of Washington Mutual), Fremont Investment and Loans, Meritage Mortgage (division of NetBank), and New Century Mortgage. Besides these, there are literally hundreds and hundreds of lenders that have emerged to fill certain various sub prime niches.

Hard Money

Hard money lenders serve a very simple purpose they allow the purchase of fixer-upper or rehab properties with no money down. These lenders offer programs that none of the

Hard money lenders are typically private individuals or small companies that make very high interest rate loans (between 12% and 18%) based on the after repaired value of a property. They will lend the money to both acquire and fix-up the property, up to a LTV of 65% or 70%. The loan term for most hard money lenders is 6-mos.

These lenders are a great, albeit expensive, way to purchase rehab properties. After doing the renovation, one can refinance out of the hard money loan with a conforming/Alt-A/Subprime long-term loan.

Wide Range of Products
Some of the various products that are available today include:

100% investor loan 1 loan or 80/20
Credit scores begin at 660 only available from Alt-A lenders
95% investor loan 1 loan or 80/15
Credit scores begin at 600 available from Alt-A and Subprime lenders
90% investor loan 1 loan or 80/10
Credit scores begin at 620 for Conforming and Alt-A lenders and 560 for Subprime lenders
80% investor loan
Credit scores begin at 620 for Conforming and Alt-A lenders and 560 for Subprime lenders

All of the above can be found in either a fixed or ARM, and can usually have an interest-only option added to help maximize cash-flow. While any loan with a LTV above 80% will typically incur PMI, you can avoid this unnecessary expense by piggy-backing a first and second mortgage together eg. 80% first and a 15% second.

The above is a real brief introduction to the residential mortgage landscape, and should help orient new investors to the available lenders and products available.

Author: Brian Anderson, Broker, Anderson Lending Group. You can contact Brian directly at: brian@andersonlendinggroup.com. Learn more about Anderson Lending Group and the wide variety of investor loans available by visiting: http://www.andersonlendinggroup.com . You can apply online and receive a pre-approval within hours.

Popularity: 60% [?]

Outside Company Distribution

There are companies out there that do distribution of post-it notes. There’s a company called Markot. I ‘m not going to recommend them because I tried them and I was not particularly happy. There are others and you can look them up on Google under “post-it note distribution” and your city name. Try one and see how they perform with small batch before you give them more business.

You tell them what neighborhood you want, you give them the post-it notes, and they’ll go out and distribute them on each and every door. They’ll walk up and down the neighborhood and put them on the doors.
I had some problems with one of my vendors. First, was they’d tell you they were delivering them this week, and then something would happen and it would be next, and then the following week. I had some problems getting them to deliver them on the dates they chose.

Second, I was always concerned when they did finally get around to it, because it seemed like my response was fairly muted compared to when I would have the post-it notes delivered myself by my people I trusted. It always made me wonder if they were getting out there in the exact number they stated.

Hire Someone to Distribute

Again, there’s nothing wrong with paying somebody to do it. In fact, that’s what I recommend, that you eventually get somebody to hire to go out and put them on doors. It’s very easy if you know some people – some young kids, 15 year olds or something like that. You can pay them 10 or 15 cents per post-it note to deliver. They can do it after school or on the weekends. It’s a nice part-time job for a kid.

For the most part, if you know the kid and you can trust they’ll actually deliver them and they count how many they delivered – you pay them after they’re completed. You should know when they’re being delivered almost to the moment they’re being delivered. That’s how often you’ll get calls.

If they start delivering them on a particular street at 4:00 in the afternoon and they deliver 300, 400 or 500 of them, it is almost inconceivable that you wouldn’t get a couple of calls. That’s how effective these are.
Some of these calls might not be very productive. You might even occasionally get a cranky person calling to complain. Tell them you’re sorry, apologize, and maybe you’ll have the kids run over and pull theirs off the door of something. Just deal with the cranky calls.

You will be getting calls almost immediately so you will know that they’re being delivered. I know for sure the date they’re being delivered because I get calls. If they deliver on Tuesdays and Thursdays, then I get calls on Tuesdays and Thursdays. If they don’t deliver on Wednesday then maybe the phone is quiet on Wednesday. That’s how effective these are.

Popularity: 52% [?]