Choosing the Right Coach Does this sound like you? You’re always looking for something or someone to help you get over the next hurdle; to help you get to the next level. You know you need a coach, but you might be confused about choosing the right coach for you and how they can […]
The post How Choosing the Right Coach will Rock Your World and Grow Your Business appeared first on Louisville Gals Real Estate Blog.
To be up to date with the latest in the property investing industry to may check out our real estate latest news. On the other hand if you’re beginning real estate investing and would like to begin profitable real estate investing today download a copy of our profitable real estate investing ebook.
Are you thinking of investing in real estate? However you do not have enough money to do so. In this article is a tip you may use as long as the person selling the property is willing to negotiate along.
To be fair, not every seller will be willing (or even understand) the concept outlined. Your better wager is to locate a property that the owner has great desire for offering it, whether because of moving, divorce, or they are frustrated with the people renting the place.
Actually, if you are currently renting and considering using this technique perhaps the owner would be glad to assist you! There are several variations that can be used depending on you and your seller. Do they want the market price or are they just desperate to get out from the monthly payments – perhaps facing foreclosure?
The simplest way is to take over their mortgage obligations – called ‘assuming’ the mortgage. You will have to be approved by the original lender to assume the mortgage. If you can’t get approved for an assumable mortgage you could as well try a ‘subject to’ assumption where you merely make repayments while the property remains in the seller’s name.
You take over the first mortgage and get a 2nd 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 can 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 should be able to refinance the cost, or you can sell. Unless you strike a real bad market the value of the home should have risen by then.
Most mortgage lenders merely want to make a good investment. While your local bank could still be lacking confidence there are a lot of financial lenders that would want to make a deal. Financiers prefare 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 estate if you default, they do not care what kind of money you make. Conclude the deal with a second mortgage done with the seller. In case you default they can still 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 may work hand in hand. In the event that they can’t wait for a sale, you may still give them their asking price with a little overall flexibility on their part.