Three legislative bills passed during Q2 2018 that will impact rental property owners. These three bills either directly affect landlords because they are national policy or may affect landlords in the future, if their state decides to follow suit and pass similar legistlation.
The Economic Growth, Regulatory Relief, and Consumer Protection Act
This bill was commonly referred to as the “Dodd-Frank Reform Bill.” It was signed by President Trump at the end of May and, among other…
To stay up to date with the latest information in the property investing industry to can check out our property investing latest news. On the other hand if you are beginning real estate investing and desire to begin profitable real estate investing now get a copy of our profitable real estate investing ebook.
Are you thinking of investing in real estate? But you do not have enough money to do this. 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 all sellers will be interested (or even understand) the concept outlined. Your better guess is to locate a property that the owner has great desire for offering it, whether because they are moving, a divorce settlement, or they are frustrated with the people renting the place.
Actually, if you are currently renting and thinking about using this technique perhaps your landlord would be glad to help you out! There are some variations that may be used depending on you and your owner. Do they desire the market price or are they just desperate to get out from the monthly payments – perhaps facing foreclosure?
The easiest way is to consider taking over their mortgage repayments – called ‘assuming’ the mortgage. You will need to be approved by the initial lender to assume the mortgage. If you cannot get approved for an assumable mortgage you could as well try a ‘subject to’ assumption where you merely make obligations 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. Instead of having the money stay in a bank they can be getting a high interest over two or three years with the rest due in full at the end of the investment term.
When the term ends 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 by then.
A lot of mortgage lenders merely need to make a great investment. While your local bank may still be scared there are a lot of financial lenders that would wish to make a deal. Financiers like property investing. The mortgage is mostly based on 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 created with the seller. In case you default they could eventually foreclose on the property and sell it, paying down the existing mortgage with the proceeds.
Now you can see the whole picture. It is better that seller and buyer may work together. If they can’t wait for a sale, you can still give them their initial price with a little overall flexibility on their part.