Why We Will Live with Labor Shortages in 2018 and Beyond

Source: https://thinkrealty.com/why-we-will-live-with-labor-shortages-in-2018-and-beyond/

Look at any major housing market in the country right now, and you will see signs of building. Inventory is short; the housing market is hot, and the cranes are all over the skyline. However, all too often, those cranes are not necessarily moving.

In the wake of the housing crash, we also saw these cranes standing still, but that was different. Then, there was no demand for their services. We had an absolute glut of housing inventory thanks to the foreclosure cris…

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Are you thinking of investing in property? But you don’t have enough cash to do so. In this article is a tip you are able to use as long as the property seller is willing to negotiate with you.

To be fair, not every seller will be willing (or even understand) the concept outlined. Your best wager is to find a property that the owner has great desire for selling, whether because of moving, divorce, or frustration with the people renting the place.

Actually, if you maybe currently renting and thinking about using this technique perhaps your landlord would be glad to help you out! There are some variations that can be used depending upon you and your owner. Do they desire the market price or are they just desperate to get out of the monthly payments – maybe facing foreclosure?

The simplest method is to take over their mortgage repayments – 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 repayments while the property remains in the seller’s name.

You take over the original 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 three years. Instead of having the money sit in a bank they could be collecting a high interest over 2 or 3 years with the remainder due in full at the end of the term.

When the term ceases you need to be able to refinance the cost, or you could 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 great investment. While your local bank could still shy away there are a lot of financial lenders that would wish to make a deal. Financiers prefare real estate. The mortgage is mostly 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 revenue you make. Complete the deal with a second mortgage done with the seller. If you default they can eventually foreclose on the property and sell it, paying down the existing mortgage with the proceeds.

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

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