Real Estate Cash Flow Investing
Real Estate Cash Flow investing is a simple when you take you
due diligence. In this article I am giving the brief explanation of all the
factors you as an investor need to consider before spending your money. So here
they are:
Purchase
- What you are willing to pay
- What is the Market price (determined buy looking at equal houses in the same
area)
- Is the owner a motivated seller (does he need to sell right away)
Down Payment
- How much money do you have to put down, or would be willing to put down, on
the property, but remember not to include the closing costs and initial
renovations.
Initial Renovation Cost
- You can only really give a guess here until you inspect the property and/or
have a home inspector come in and check the property out.
Closing
Costs
- The Best way to estimate Closing costs is to Call a local Real Estate Agent,
and be sure to ask about lawyer fees and home inspection costs
Mortgage application fees
- Vary depending on your financial institution so do not have theses fees
others can charge a large amount Call you lending a few lending agencies and
price out the average in your area.
Monthly Rental
- If the property is not already a rental contact a local property management
company and ask there opinion and/or read over your local classified sections
and see what the going rates are there.
Vacancy Rate
- The most commonly used vacancy rate is 5% but to get a more accurate rate,
Call local property managers and your real estate agents they may have good
insight also check out your areas censor reports
Monthly Management
Maintenance
- If you plan to have some one else manage your property then check you yellow
pages and shop around for property management companies and ask for references.
Property Tax
- The real estate agent or owner should be able to give you this information.
Property Insurance
- If it is already a Rental you may be able to get the numbers from the
property owner or your real estate agent other wise you will have to call up an
few insurance companies to get a price.
Mortgage Interest Rate
- You can get this from your local mortgage broker or just look it up on the
web there are tons of places that will tell you today's going rate
Mortgage Amortization
- The usual term is 30 years in the U.S. or 25 years in Canada
Mortgage Insurance %
- There are a few different places to get mortgage insurance and it is only
needed if your down payment is less then 20% in the US or 25%in Canada. Your
realtor should know the present rate.
Transfer Tax
- Transfer tax varies greatly from area to area this can also be obtained form
you real estate agent.
About the Author
Creator of www.toolstowealth.com a web site designed to help people invest smarter.
An Investors Guide Into Foreclosures
At this point, you should be convinced that Foreclosure investing is the best place to inter the Real Estate marketing. Unfortunately, every month thousands of homeowners are faced with the possibility of losing their homes to foreclosure. But, as if all aspects of life, one man's problem is another man's opportunity.
As an investor, you can actually be a blessing to a family who is unable to continue to make their monthly mortgage payment. By implementing some of the knowledge listed below, and in future lessons, you can find quality homes, secure them with little or no money down, and then either rent them out for a residual income, or sell them for a sizeable profit.
However, if you are interested in foreclosure home investing you are not alone. There are hundreds of people in every state that buy foreclosed homes and sell them for profits. This has been proven as a great way for anybody to make money in the real estate industry. If this sounds like something that is interesting, you are in luck. There are tons of resources that are available on this industry, and anybody can get started in no time at all.
Getting started in foreclosure home investing is not a difficult task. The first step that you must take before getting started is obvious; you will need to determine what you can afford. By setting your budget, you will ensure yourself of staying within your limits and never over extending your means. The best thing to do is only look at properties that are within your budget. This will go along way in making sure that you do not get enticed by a property that you cannot afford.
After you have set your budget, you will want to determine which areas are appropriate for foreclosure home investing. In other words, if you live in the city, you may not want to buy a home that is two hours away and in the middle of a farm land. But on the other hand, you may be looking for a change of pace and decide that the best situation for you is to find a property that is not like the other ones that you own. There are no hard and fast rules for where you should buy foreclosed properties. It all comes down to personal preference, and what you think will fit in best with your current situation.
The next step of foreclosure home investing actually has to do with finding the homes in the area that you are interested in. There are three common ways that you can do this. First off, many people begin by searching the newspapers. This is only natural because people believe that this is the best place to get free information. There is another group of people that prefer to call the lender directly on the phone to obtain property listings. Again, this is free and you can get a lot of listings at once. Finally, there are hundreds of online services that you can join that will be able to supply you with foreclosed properties in your area. These services usually charge a monthly fee, but it is well worth it because of the amount of properties that you will be able to search through.
If you follow these three steps you can get started in foreclosure home investing in no time at all. Remember, foreclosure home investing is not a difficult thing to do. It just takes a little bit of knowledge and determination.
About the Author
D. Brownlee http://www.Foreclosurefaq.info. D. Brownlee has more than 10 years experience in the Real Estate market, including 2 as an Independent Loss Mitigation Specialist.
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