1031 Exchange & the Role of the Agent

Source: https://thinkrealty.com/1031-exchange-role-agent/

While most real estate transactions conducted in the United States have a real estate agent involved, not many of them are clear about their role in the 1031 Exchange.
What… more

The post 1031 Exchange & the Role of the Agent appeared first on Think Realty | A Real Estate of Mind.

To stay updated with the latest in the real estate industry to can visit our property investing latest news. On the other hand in case you are beginning real estate investing and desire to start profitable real estate investing now download a copy of our profitable real estate investing ebook.

Are you contemplating investing in property? But you do not have enough money to do this. In this article is a tip you may use as long as the property seller is willing to negotiate along.

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

Actually, if you maybe currently renting and considering using this technique perhaps the owner would be happy to assist you! There are several variations that may be used depending on you and your vendor. Do they want the market price or are they just eager to get out of the monthly payments – maybe facing foreclosure?

The simplest method is to consider taking over their mortgage payments – called ‘assuming’ the mortgage. You will need to be approved by the first lender to assume the mortgage. If you cannot get approved for an assumable mortgage you could also try a ‘subject to’ assumption where you merely make payments while the property stays in the seller’s name.

You take over the original mortgage and get a second mortgage on the remaining cost of the property with the seller. Offer a high, interest-only payment for a short time frame – 2 or three years. Rather than having the money sit in a bank they can be getting a high interest over 2 or 3 years with the remainder due in full at the end of the term.

When the term ends you ought to be able to refinance the cost, or perhaps you could sell. Unless you hit a real bad market the value of the home should have risen by then.

Most mortgage lenders merely need to make a great investment. While your local bank could still be lacking confidence there are lots of financial lenders that would like to make a deal. Financiers prefare property investing. The mortgage is mostly based on 60-70% of the value of the property, so as long as they understand they get their money back in the value of the property if you default, they do not care what kind of revenue you make. Complete 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 entire picture. It is better that seller and buyer can work together. If they can’t wait for a sale, you can still give them their asking price with a little overall flexibility on their part.

Share This:

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *