Why Smart Home Tech is a Smart Investment

Source: https://thinkrealty.com/smart-home-tech-smart-investment/

The real estate industry is highly competitive, and it’s more important than ever for investors to keep up with the latest trends. Over the last decade or so, the demand… more

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Are you thinking of investing in real estate? However you don’t have enough money to do this. Right here is a tip you can use as long as the property seller is willing to negotiate with you.

To be fair, not all sellers will be interested (or even understand) the concept outlined. Your best wager is to locate a property that the owner has great desire for selling, whether because of moving, a divorce settlement, or frustration with the folks renting the property.

Actually, if you maybe currently renting and considering using this strategy perhaps your landlord would be glad to help you out! There are a few variations that can be used depending on you and your vendor. Do they want the market price or are they just desperate to get out from the monthly payments – perhaps facing foreclosure?

The easiest way is to take over their mortgage payments – called ‘assuming’ the mortgage. You will have to be approved by the initial lender to assume the mortgage. If you can’t get approved for an assumable mortgage you may as well try a ‘subject to’ assumption where you merely make repayments while the property stays in the seller’s name.

You take over the first mortgage and make a second mortgage on the remaining cost of the house with the seller. Offer a high, interest-only payment for a short time frame – 2 or 3 years. Rather than having the money stay in a bank they could be collecting a high interest over two or three years with the remainder due in full at the end of the investment term.

When the term ceases you need to be able to refinance the cost, or you can sell. Unless you hit a real bad market the value of the home should have risen in that time.

Most mortgage lenders merely want to make a good investment. While your local bank may still be scared there are plenty of financial lenders that would like to make a deal. Financiers like property investing. The mortgage is usually around 60-70% of the value of the land, so as long as they know they get their money back in the value of the land if you default, they don’t care what kind of money you make. Conclude the deal with a second mortgage done with the seller. If you default they could eventually foreclose on the property and sell it, paying off the existing mortgage in the proceeds.

Now you can observe the whole picture. It is better that seller and buyer can work together. In the event they can’t wait for a sale, you may still give them their initial price with a little overall flexibility on their part.

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