Foreclosures…Fact based Offers for Homes (bad credit home loans)
No commentsBy John G. Kelly
Foreclosures are at an all time high and are growing daily as the financial meltdown gathers pace. Not a week goes by without some more bad news about write-offs by banks, waves of resets on adjustable-rate mortgages, tighter lending practices and deathly slow real estate markets. Even willing buyers are finding it hard to find a bank who will loan to them without significant money down and proof of high credit worthinesss. Most pundits are saying it’s going to get worse before it gets better. I think they are right!
However I stand in this gloom as a real estate investor. So while Congress and the White House continue to look for ways to hold back the rising tide of foreclosures I see it as a time of great opportunity. I can help solve problems for home owners who are in trouble as well as the banks. The banks really don’t want to own all this property. It’s not their business, is a big distraction and ties up funds they can’t loan out until they liquidate the asset.
From an inventory point of view, foreclosures have been hitting the middle and upper middle class that are normally spared so there are houses up and down the value scale and often in good condition. This makes them easier to sell. I have found that buying foreclosures is not for the faint of heart as it has its drawbacks and dangers. However if have done your research correctly, it is possible to find foreclosures at 30% and even 40% off the current depressed market value, but of course this number varies. But as banks take back more property as real estate owned (REO), the pressure to discount will be huge.
I rarely go to auctions as they are often cancelled without notice and I have competition. I don’t like having to commit a $5-10,000 banker’s check that will be non-refundable if I don’t close. So I make my offers direct to the distressed homeowner, after finding out what the financial position is surrounding the home. By this I mean the amount of any mortgages that exist and the terms if possible. I do this by researching at the registry or going on line. As long as there is equity in the home, I make assumptions about the amount in default and construct an offer accordingly and show them local comps.
It’s simply baiting a hook and if they are interested they call but to do this successfully you need to have accurate data about the property.
John G. Kelly an investor since 2003, has created a short course on how to find out the key financial details about a property. With that data you can confidently construct strong offers that will help you buy more houses. http://www.RealEstateTitleResearch.com
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What Is Hard Money and How Will It Benefit You?
By yanni Raz
Have you heard the term “hard money,” but you’re not sure what it means? Perhaps you know what it is, but you’re unsure where to find it.
Hard money is financial backing from private investors in the form of a loan. It is one of the best ways to get a business project off the ground, but you have to know how to obtain it the proper way.
Hard money loans are often used for construction projects. Typically, the lender loans the money in stages.
For example, let’s say you own a plot of land and you want to develop it. A lender will agree to back you on the project. They will loan you a percentage of the money at the beginning of the project,more during the middle of the project and a final installment near the completion of the job.
Lenders often pay the contractor for their work directly. For instance, once your contractor completes the foundation of the new building, the lender pays them a specific amount directly. Then, when the electricians finish wiring the building, the lender pays them directly as well. All contractors receive their payments direct from the hard money lender.
Private investors often prefer this approach because it gives them greater control over their money and their investments. You don’t have to be a big real estate mogul to get hard money from investors.
Many investors are willing to support many different types of projects. Private investors will financially back projects like single family residences, condos, townhouses, apartment buildings, hotels, motels, office buildings and shopping centers. However, they will not usually invest in undeveloped land.
While hard money lenders are willing to loan to residential investors, they most frequently invest in commercial real estate. This is due to today’s instability in the housing market.
Commercial investments are simply a safer bet for recouping funds an investor puts into a project. Because of skyrocketing foreclosure rates in the modern housing market and property values dropping at record rates, there is considerably less risk involved for the investor in commercial projects.
Commercial real estate is a very competitive market, but hard money investors are willing to buy properties, remodel existing structures and even build new properties. The commercial real estate market is still alive and well. In fact, today’s commercial market is very similar to the residential market that profited so many people just a few years ago.
Hard money lenders are still in the game. In fact, they are busier than ever because banks are making the lending process more exclusive than ever due to a record number of people defaulting on their loans.
Knowing how the private lending process operates is half the battle when it comes to finding private investors for your commercial real estate project. With a little research and networking, you will find the perfect backer for the commercial real estate project of your dreams. The hard money for the project is out there; all you have to do is find it.
Yanni Raz mentors many in the Real Estate Mortgage industry. Yanni Raz tutors homeowners in California and helps many of them save their homes.
Hard Money Loans
Thursday, August 28th, 2008 at 12:45 am and is filed under realestate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
