How to Hold Real Estate in your Roth IRA

Real estate as an investment option
After the 2008 global financial crisis, investors are increasingly looking for assets, away from stocks and bonds, that can help diversify their portfolios, act as an inflation hedge, and provide a long-term return for retirement. One such asset is real estate, and it may be best to hold it in a self-directed IRA account, which is run by a third-party administrator and allows the investor to choose what types of investments and asset classes to put in the account. A self-directed Roth IRA offers you the added advantage of compounding your income, gains, or savings tax-free and enables you to invest in real estate such as residential homes, condominiums, commercial properties, co-ops, or even land, all within your Roth IRA.

Things to consider and prepare Investing in the real estate in a self-directed IRA does require a different mindset because there are a number of rules you must follow, or the tax benefits can be voided. First, you need to find a bank or brokerage that has a qualified trustee or custodian for self-directed IRA and knows how to handle your real estate purchases, administers the account, and files the relevant documents with the IRS. You must also have enough money in your IRA account to buy the real estate investment from your IRA account. Some custodians may allow you to borrow to purchase the property as long as the loan is non-recourse, i.e. the house alone is used as the collateral. You cannot buy a property which you reside in or is a part of your business or buy a property you or your family members own a specified percentage – the IRS bans self-dealing. With a self-directed IRA, you also are the only one responsible for your investment decision and complying with all the regulations and rules for your investments.

Operational procedures
After your IRA custodian has purchased the property for you, the title will be in the name of your IRA custodian. The IRA account pays all the management fees, taxes, insurances, and property-related expenses and so the account needs to have sufficient cash. You could lose the tax benefits or incur penalties if you fund these expenses from your own account.

To have more control over your investments, you can create an LLC that is owned by the IRA to invest for your IRA. With this checkbook control, the IRA owner can write cheques to make purchases, pay property bills and marketing expenses, and have greater control over the assets.

Some advantages and disadvantages
Real estate can provide the owner with long-term investment value with the potential for appreciation. If the property is rented, it can provide the owner with rental income. Not only is real estate a hard asset compared to stocks and bonds but also an investment the investor understands well. The other big advantage is that if you purchase the property from your self-directed Roth IRA without a mortgage, all the rental income will be compounded tax-free. However, if you finance the property purchase with a mortgage, then the rental income becomes unrelated business taxable income, which will be taxed when earned. Another disadvantage is that you cannot claim depreciation when holding the property in the IRA. You will not be able to enjoy any advantage from your property investments until you retire.

REIT can be an easier option
If holding a physical property in your IRA is too much work for you, you can also consider investing in a Real Estate Investment Trust (REIT), which is similar to a mutual fund but invests in the real estate market. REITs are required to pay out 90% of their profits through dividends. However, investors also need to understand any tax implications when holding REITS in the Roth IRA.

Conclusion
Real estate investment is a good investment diversifier and provides long-term value especially when held in a tax-free Roth IRA. As to which type of the IRA accounts or real estate investments suit the investors’ goals the best, the investors will be wise to consult their financial advisers, accountants, and tax professionals first.

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Real Estate Investing for Beginners

The housing crash has made it possible for you to invest in really attractive homes without having to spend a small fortune and many investors are making the best of the situation. If you want to get a share of the real estate pie but lack the knowledge and experience to go about it with confidence, we are here to help. Here are a few points you should know about the two ways in which you can make this investment.

Direct purchase of property

The most evident way is to buy a house or other kind of property directly from a seller. If you can make a substantial investment, you may even be interested in owning a small apartment complex. If the home or apartment complex is in a good location, finding tenants for the property is easy and you can demand good rentals from them too. Make sure that you comply with fair housing rental regulations, building code requirements and other legalities. Also factor in repair and maintenance costs that you will have to bear before you invest in property.

Investing in REITs

Another way to own real estate is to invest in a Real Estate Investment Trust or REIT. With these you buy shares in a portfolio of properties. REITs give you an opportunity to invest in real estate that may be unaffordable to you otherwise. For example, buying a sky scraper office complex in Manhattan is impossible for you but buying into an REIT that includes this property may be a viable option. In addition, REITs eliminate the hassles of managing maintenance and tackling tenants that you cannot avoid when you own a home or apartment complex that you have let out.

Points to keep in mind with real estate investment

Remember that real estate is a huge asset and a substantial portion of your savings is going to be locked up in it for a fairly long term if you want to make good returns on investment. It is not advisable to do your investing without taking adequate care and giving enough attention to the task. These are some points to keep in mind before investing:

·         Do some research: Whether it is identifying a good property or the right location to buy your home in or a reasonable price to agree upon, doing your homework before making your purchase is a must. After all, you do not want to end up pouring your hard earned money into a property that cannot yield the returns your expect.

·         Be patient: Real estate is typically a medium to long term investment so expecting your property value to soar overnight is simply not a good idea. You may get pressured into selling the property too soon, before it has had time to increase in value. Make a plan beforehand about the time period that you are looking at for your investment to give you returns and once you make the purchase, remain patient until you are sure to get the best returns possible. 

·         Don’t make emotional decisions: It is easy to get emotionally attached to property that you are looking to buy but allowing the emotion to sway your judgment can be a fatal mistake in real estate investing. No matter how appealing a home may be, it is definitely critical to look beyond the appearances and check if the house really makes a good buy considering its age, its condition, location, features, price and other aspects.  If you cannot make an objective decision, call in a  friend or relative who can tell you whether the property makes a worthwhile investment for you.

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Pending House Sales Slow

The US housing market has shown a robust recovery since the depths of the Great Recession, but there are some worrying signs that the surge is starting to show weakness. According to the National Association of Realtors, their seasonally adjusted pending home sales index fell in September to lows not seen since December last year.

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In September, the index fell to 101.6, a decline of approximately 5.6% in a single month. That precipitous fall follows a decline from around 112 back in May to just above 107 in August. In fact, the index is now lower than it was in September 2012, the first time that the index has fallen year over year in nearly 2½ years. While most analysts who track the housing market believe that sales will continue to recover, the rate of recovery is likely to be significantly lower in coming months.

The underlying reasons for this may be a combination of higher mortgage rates and home prices, which once again have started to make accommodation increasingly unaffordable. Mortgage rates climbed to a two-year high in August and remained at high levels in September, although they are still relatively low on a historical basis. There has been some relief in October, but it is unclear how long this will last.

Against this background, what can homeowners and developers do to ensure that they sell their properties?

First of all, getting the price right is essential. Before listing a property, sellers should survey the selling price of similar properties in the area, and look at what the trend has been for the past several months. While dropping prices to bargain-basement levels is not the right thing to do, it is also important not to price properties out of the market. Generally, if the price of the property is 5% or less above the target selling price, then buyers will be willing to make an offer. However, anything higher may well scare them off.

Second, it is important to get a good realtor to promote the property. Sellers should choose a realtor who has a track record of closing sales in their area, and should check that they advertise the property widely – including online and in local media. Open houses are also a good idea, provided that they are promoted visibly and well in advance. For example, placing banners in the surrounding area that direct people to the open house can generate significant interest. 

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Finally, when buyers look at a property, they think about the total cost to them, including any work that needs to be done. Therefore, it is critical that the property is presented in good order. It should also be “neutral” – it needs to be a blank canvas for the prospective buyer, rather than a reflection of the current owner’s personal tastes. For example, the walls should be painted neutral colors, flooring should be unobtrusive, and furniture should be positioned to provide easy flow throughout the home.

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Top Realtor - Agent Harvest

Selling or purchasing a home can be challenging in today’s market. Not only is it important to get the task done, but more importantly, you need to find a real-estate agent who puts your needs before making a big sale. However, it may be harder to locate a realtor than you realize. Therefore, you may want to consider hiring a company that specializes in finding a top realtor meant just for you. We, the professionals at Agent Harvest, are that company and are here to serve you. 

Agent Harvest is a real-estate agent rating service employed with top-notch professionals specializing in finding you an agent that meets our company standards. The agents we seek should not only be knowledgeable in a variety of markets, but they should hold a proven track record of great communication skills, excellent marketing strategies, and effective marketing and pricing techniques. In addition to finding a realtor, we can also help answer any questions you may have of realtors and anything you need to when purchasing or selling your home. 

The service we provide at Agent Harvest is both easy and effective. Not only will we provide you with the pros of real estate but also the cons as well. For example, we have created a parody website which offers you information pertaining to the industry’s worst real estate tactics. In addition, you can research our blog for the latest information on bad examples of real estate experienced by actual clients. Listen to their stories and learn from them prior to choosing any realtor. However, at Agent Harvest, we can help lessen your worries and focus on what’s really important.

Again, research our company site and be sure to read the testimonials provided by past, current, and even repeating home buyers and sellers. Once you have researched all the useful information we have to offer, be sure to note your top three real-estate agents and prepare an email to be delivered to them. Be creative and ask questions such as: Do they have references? How do they intend on showing properties? What separates them from other realtors? Again, this is only a starting point, but it will certainly help get you headed in the right direction. So, if you are seeking a realtor who won't waste your time, create additional stress, or cost money, contact us at Agent Harvest for your realty needs. 

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Safeguarding Your Real Estate Investment

Investing in the real estate markets has become an increasingly viable option, given the persistence of recovery in the housing markets. Ordinary people are buying second homes to rent or renovate, while serious investors are returning to real estate as a potentially lucrative basis for their investment. For those who choose to invest in real estate, safeguarding and maintaining the value of the investment is essential. Homes can deteriorate if left unchecked, and apartments can easily fall to ruin. At the same time, simple errors in your investment strategy can leave you exposed to turmoil in the local market.

For this reason, cutting it in real estate investment now requires a more discerning approach, with not every property guaranteed to turn out to be a winner. So how can real estate investors find the right properties to deliver growth in the value of their investments?

Image source: http://www.signil.com/wp-content/uploads/2011/01/investment-property.jpg

Finding the right properties is the first, and arguably most essential element of safeguarding your investment in real estate. Finding the right type of property for your target market will ensure that you can find tenants to rent from you more easily. For example, opting to buy an apartment with six bedrooms and only one bathroom  can be very challenging to source willing tenants. However, where your property more accurately meets the needs of the local market, you will notice it becomes easier to sell and rent your property for a return on your investment.

Location is crucial to the value of a property, and many investors are already familiar with the link between location and real estate prices. But these relationships are fluid over time, and any buyer should think about the longer term. Some locations are on an upward trajectory, experiencing local regeneration and growth. Other locations are more visibly in decline, as the demographic and commercial landscapes continue to shift and develop. Choosing the location for your investment property is also crucial – some apartments can go years without being let, whereas the apartment across the street will go overnight. For some buyers, location is everything.

Think about the desirability of the investment property you are considering buying. Why would people choose to live there, and would you live there personally? What value are you providing that justifies your investment? Do local amenities make your real estate a sound strategic choice? Some apartments and homes will sell themselves, simply by their location or their appearance. Within the parameters of your budget, it is worth striving to attain this level of desirability in your real estate, with a view to attracting higher rental rates and a greater local interest in your property.

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Many new property investors take a hands-on approach, spending their own money to partially or wholly renovate the real estate they buy. This can increase the resale value, while making a property a more attractive place to live. Some people even choose to invest in properties that require more extensive work, before working through the renovations to increase the value of their investment. On a strict budget, this can be effective. However, it may be valuable to work to professional valuations and estimates, so you can be realistic about the financial gains of this kind of strategy.

Short of renovating your real estate, the actual presentation of your property will also have a bearing on how it is received by potential tenants or buyers. You don’t have to spend a great deal of money on your real estate to overhaul how it is perceived by its target market. Remember that you are up against other homes being marketed locally – it is unsurprising that properties with stronger interior design sell and rent quicker, and at a higher value. Even subtle things like décor, flowers and throws can make the difference between securing the future yield of your investment.

Real estate investments can be among the most lucrative opportunities for investors, in both rental and sale markets. A long-term tenant can pay off a mortgage on the investment, while the value of the property fluctuates with real estate prices. With the right choice of property, this can provide significant returns over both the short and long term.

However, the housing market has been suppressed in recent years, following on from the crash of 2007. But with demand returning to the markets, through both investors and homebuyers alike, residential real estate is becoming an increasingly favored option for those with capital to invest.

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The Housing Market Rebounds in Arizona

 Back in the dark and dismal days of the financial crisis, Arizona was one of the first and hardest-hit housing markets. House prices declined over 30% in one year, wiping billions of dollars off of the residential property market. There were massive layoffs in the construction industry, contributing to the further slowdown of the state economy and leading to a downward spiral.

However it appears that the doom and gloom may finally be over, providing significant new opportunities for investors – as well as those who are looking to move into a new family home. For instance, the price of housing in Phoenix has risen slightly over 30% since Q1 2012, far outstripping the national average rise of 11.3%. That sort of growth is worth a second look for anyone who is serious about increasing the returns on their investment portfolio.

Based on data fromMichael Orr, the director of the Center for Real Estate Theory and Practice at the W.P. Carey School of Business at Arizona State University, it appears that the fundamentals of the Arizona housing market are becoming strong, indicating that the recent dramatic rise in prices is not just a repeat of the previous bubble in 2007. For example, sales of single-family homes have been on the rise, and more of them are being purchased by homeowners rather than investors – which indicates that end-user demand is strong and prices are not being artificially inflated by speculation. Furthermore, while the housing inventory (the number of houses for sale) has been rising, it is still at historic lows, which supports continued price increases.

One of the barriers to further expansion of the housing supply in Arizona is a lack of skilled construction workers. Many of these workers retrained for other industries or moved out of state when the financial crisis struck, so that employment in the sector remains at levels not previously seen since the mid-1990s. While this does limit investment opportunities, it also means that supply is unlikely to outstrip demand in the short term – boding well for continued price growth. It also means that real-estate projects that already have new homes built, such as Eagles Nest Living near Scottsdale, are particularly interesting investments.

Another encouraging sign is that, despite the recent rises, property prices remain below the long-term trend. Looking over the 10 year period from 1989 to 1999, prior to the housing bubble, the annual growth rate was 3.1%. If you project that through to the current day, it suggests that the market is undervalued still by 15% to 20%. That is plenty of headroom for a canny investor, especially when you consider that financing remains extraordinarily cheap – vastly increasing the investment leverage.

There are a number of other factors that suggest the Arizona housing market is on its way to recovery. Foreclosures are down 60% in the last year, and bank sales of distressed properties are down by 53%. House purchases by rental firms are also low, indicating that the demand is real and not another bubble. All of this is encouraging for anyone who is considering investing in the Arizona real estate market.

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Investing in Real Estate in 4 simple ways

Investing in real estate has a lot more advantage than from investing in other asset classes such as stocks, commodity trading or hedge funds. It also offers significant advantages to a diversified investment portfolio. Investing in real estate also has a number of characteristics that differentiate them from other assets. In addition to that, rental income provides a regular revenue streams that helps to increase the overall returns.

In the following . We discuss about 4 simple ways of Real estate Investment

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Foreclosure Rates Continue To Fall

The rate of real estate foreclosure nationwide is continuing to fall as the housing market improves and the economy regains pace. Foreclosures in Florida hit their lowest rate in 3 years back in February, while Milwaukee saw a decline of 0.7% on the year, showing a consistency in the rate of non-defaulting mortgages.

According to data from Lender Processing Services, the percentage of US households in arrears with their mortgage but not in foreclosure has also fallen on the year, down to a low of 6.8%, which complements foreclosure data in highlighting an improving picture for the housing market.

In the wake of the crash of 2008, rates of foreclosures soared to record high levels as unprecedented mortgage defaults and the collapse of the sub-prime market led to widespread turmoil for housing nationwide. However, with foreclosure rates on the decline and property prices starting to show signs of regaining ground, it looks as if the wider housing economy might be beginning to move in the right direction.

Analysts have welcomed the results as an ongoing sign that underlying conditions were improving – essential for a wider national economic recovery. LPS suggested that a decline in foreclosures was symbolic of the recovery, and could help provide banks and mortgage lenders with the confidence they need to increase their lending activities to pre-crash levels.

Foreclosure is the process of repossessing a home for resale, in the event that the owners are unable to repay the mortgage on it. Foreclosures create homelessness and disruption in the lives of those they affect, but are taken broadly to be a sign of wider economic and housing market malaise.

The foreclosure process happens after the homeowner falls behind with mortgage payments. The effects can be more devastating when the home’s value has depreciated. However, with stubborn levels of unemployment and a tightness of capital across lending markets, the rates of foreclosure have increased substantially over the last few years.

According to the data, the five worst states for mortgage delinquency leading to foreclosure are Florida, New York, New Jersey, Mississippi and Nevada. The five top performing states are Montana, North Dakota, South Dakota, Wyoming and Arkansas, which have lower foreclosure rates and fewer mortgage arrears problems.

When facing foreclosure, individuals can choose to take a number of alternative actions to avoid the process. With the assistance of specialized legal help, it can be possible to work out other options including short sales and buy-to-rent-back schemes, which can enable the foreclosure option to be avoided. In many circumstances, homeowners simply want to stay in the homes they have saved and paid for, regardless of the debts attached to it. In some cases, these alternative options can represent better value for money.

The fall in foreclosure rates is being seen as an indicator of the ongoing improvement of the national economy. A housing market recovery in particular could be advantageous to growth and job opportunities across the US in the coming years, and hopefully can help prevent too many more families from experiencing the trauma of the foreclosure process.

Image source: http://www.chriswesnerlaw.com/files/2013/02/Foreclosures.jpg

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10 Commandments for Home Buyers

1. Don't buy a house... buy a Home

Buying a house means that you are ready to give in to the fate life has given you and finally decide to settle down. When buying a house, don't just think of the aesthetics. Instead try to find the right place for you by thinking of the home you want to build. After all, a house will always only be a structural entity which any person can occupy. But a home is where your heart is and that is what you should keep in mind when looking for the perfect signage of a House for Sale.

2. Formulate a good financial plan and stick to it

Knowing your credit standing is only the tip of the iceberg. Actually owning and paying for the house is a totally different story; which is why you need a solid financial plan that you can realistically stick to. A house loan is probably the biggest financial commitment you will be in at one time.

Map out all the expenses that you are expecting when owning a house. This does not only include the monthly mortgage, of course. You have to put into strict consideration costs of repairs, furniture, property taxes and whatever it is that you will be shelling out cash for. 

3. Do not lose your income.

Owning a house is a solar system of a responsibility. Do not take it lightly. Losing your primary source of income can have devastating effects. You could lose your home! If you absolutely have to leave your job behind for what you believe is a greater opportunity at success then at least have one steady source of income in your household.

4. Do not apply for a mortgage that is more than what you can truly afford

Yes, the mansion was perfect for you wasn't it? Unfortunately, mansions come with a hefty price tag which sometimes is not exactly within the range of our budget. Stick to your financial plans. Stretching your mortgage budget by a little is fine only if you are absolutely sure that it will not affect your financial plans. Anything that will cause you to sacrifice furniture is... well... Not practical anymore.

5. Do not go into debt, especially with credit cards

 loan is a debt no matter the angle you look at it. And debts have a tendency to pile up on top of one another when not met on due dates. With the immensity of a house loan, believe me; you don't want to pile anything atop it. Try to keep the shopping sprees to a minimum, especially if you are on a strict budget. Whatever is not within your financial plan can bite you back in the future so be extremely careful with using your credit cards.

6. Do not overspend on cars, jewelry or other stuff not in the budget plan

Beware of car salesmen, most specially the silver tongued ones! They can sell 4 wheels on a stick if they wanted to! If a car is a needed, do not shoot over your financial plan budget. A house and car loan at one time is a really heavy burden and if you let yourself be swayed by that BMW convertible you are increasing the chances of losing both.

7. Ready yourself with a little cushion/emergency fund

This is actually mandatory for anyone planning purchase their own house. If you do not have emergency savings then you are definitely not ready for a housing loan. A good cushion should give you at least six months of survivability if ever you lose your job and have to find a new one.

8. Insurance is important- Life, disability and health

Accidents do happen. That is one fact of life that is hard to accept. It is best to always have the best life, disability and health insurance you can obtain. In the instance of temporary or permanent disability, a good insurance will be your financial back up. It will ensure that you do not lose your ability to pay for the monthly mortgage and maintenance costs.

9. Do not buy furniture...yet!

Your credit standing will be checked during pre-approval by lenders. However, it does not end there! They will check it again and again, over and over until the deal is finally closed. This is why your credit scores must not change for the worse before the papers are signed ad the house is yours. Put off buying furniture until after the deal to be safe. House comes first, then furniture.

10. Know your credit scores

The first step to take when buying a house is to know where you stand financially in the bank’s perspective. The days when you can loan a house without as much proof that you can actually pay for it is long gone. Banks have become a lot more scrupulous in determining whether or not you can actually afford to own your own piece of property.

Getting your credit scores are quite simple. You can get free reports on your credit from websites such as annualcreditreport.com. You can even file disputes if ever you see mistakes. Just make sure that all of you information is up to date. Remember that the higher your score is, the better off you are in getting lower interest rates on housing loans.

With a good credit score it is easier to go around canvassing for the house of your choice. If you don't have the best credit ratings out there, well it's not hopeless. You will just have to accept that banks will not be as lenient with you and expect higher interest rates. Now, that isn't really all that bad but you are going to have to be more careful in choosing the right house.

Author Bio:

+Lara Seers is a real estate agent for properties in Queensland. She presents buyers with several options and describes each property in full detail to make it easier for them to make the best choice.

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The Best Time For You To Buy A Good House

Buying a good house is important and difficult task . It depend your luck and chance .If you are looking for a new house, chances are you want to get it for the best price possible, right? Right. So how do you know what the right time is to buy a house? Here are a few things to keep in mind as you are shopping and looking to put in an offer. 

First, think about the time of year you are out looking. It is generally accepted among the real estate community that the colder it is outside, the more likely you are to get your bid accepted. Why? 

Because there are fewer people looking to buy a house the later it gets in the year. Why? Well, who wants to move in the middle of rain, snow, sleet and wind? Not the ideal moving conditions. And because there are fewer people that want to move during that time of year, the fewer offers there will be on a given property. The fewer offers, the more apt the owner is to take the first reasonable offer that comes along. 

And, get this. The best time in the winter to buy a house is the week between Christmas and New Year’s. The reason for that is agents have forgotten about the properties that are still waiting to sell. They don’t expect a lot to happen during that week, and are excited when something does. 

Of course, another way to get the best price is to watch a certain property to see how much activity there has been on it. Also, you can do research to see how long the current owner has had the home. This may give you some insight as to how motivated they are. Have they changed realtors more than once to try to get the house sold? 

Wait until the market slows to make the jump into buying the home. The slower the market, the fewer offers. The fewer offers, the more likely the seller is to take the offer. They may be so happy to have an offer that they may take it as long as it is reasonable.

Also, with a slowing market, people with less than perfect credit will be able to qualify for a loan. That is because sellers are more motivated. As an example, take an owner that is asking $100,000 may take $89,000 for it. With taking so much less for the house, lower credit scores will be able to get a loan for the lesser amount. 

So, keep in mind, when you are looking at houses, that timing is everything. For some, timing is the changing season, for others it is the market as a whole. Be sure to watch the trends and pick out the best time for you and your situation.

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Top 10 Successful Real Estate Investing Secrets

Successful real estate investing is not a dream but a reality for people who know top 10 secrets on how to become a landlord and live by them every day. Real estate success does not only happen to very smart people with extensive educational background and six figure salaries; on the contrary, anybody who has strong desire to succeed and motivated to take charge of his own financial future can do this. All of us are conventionally taught to study well at school so we can then go to college, graduate and join corporate America work force and start living an ideal American Dream life. A lot of people work hard 60-80 hours a week, earn good salaries but still feel like they are not getting anywhere. Even some very high compensated executives do not have the financial freedom to quit their jobs and start living the life they really desire.

What are the secrets to real estate investing and how can you accomplish a worry-free financial future for your family and finally start living the lives you want? Before we begin, it’s important to remember that estimated 80% of millionaires in America earned their fortunes through real estate investing.

1. Real estate investing is NOT a get quick reach scheme but rather a structured system comprised of investing strategies, clearly defined goals being fueled by immense desire to obtain financial freedom. Understanding what it is you want at the end of real estate investing is one of the most important principles that lie at the basis of any success. Are you a single Mom who wants to spend more time with her children or perhaps you hate your job because you would rather be traveling all over the world instead? Essentially, becoming a successful landlord gives you this freedom of leading the life that you want. Defining these goals and devising your personal realistic plan is the key!

2. Do not be fooled that you can do this on your own. Unless you have the professional training in real estate investing you might not know all the basics, underwater stones and key strategies to real estate investing. Many novice real estate investors try buying their first residential investment property without really knowing what to look for in a property. If you would rather not waste the time and your hard earned money, getting help from professionals is a must. Joining one of the real estate courses is a great opportunity to learn firsthand advice from experienced investors. Not all real estate courses are created equal, look for the ones that offer not only information but a mentoring program. Find out whether mentors own their own investment properties and how successful they are at it. One of the best real estate investor programs is Lifestyles Unlimited based in Houston, TX that offers not only detailed ongoing educational courses and real estate case studies classes but a mentoring program that allows first time real estate investors to learn steps to buying a house and personally coach them on how to accomplish this in their individual situations.

3. Deciding how you want to profit from real estate investing is important. There are 2 major approaches that real estate investors use in order to profit, namely, buying several residential properties and receiving monthly cash flow while holding on to the properties and the second one is buying a property below its market value, fixing it to enhance its value and reselling it. Understanding all pros and cons of both types of transactions will help you decide which strategy to undertake. Either way, the ultimate goal is to find a property below its market value allowing you to receive monthly cash flow and/or profit from capital gains and future appreciation.

4. Never buy a residential, retail property for sale, commercial property for sale or any other type ofinvestment based on the potential future appreciation. What if this appreciation never happens and you will end up losing thousands of dollars? You simply cannot sustain this type of investment if you are not receiving monthly cash flow. Cash flow is an absolute must! Cash flow is the difference between rent money received and mortgage money paid. As a general rule you should stay away from buying properties that are not returning at least 15% on the money you invested in the deal. Walk away from such properties and search elsewhere.

5. Know the buying a house checklist and follow it to a tee! Never buy a residential investment home without an inspection, title insurance, without pre-approval for a mortgage and other important aspects. You simply cannot cheat in real estate investing, it will backfire at you when you least expect it!

6. The secret to successful real estate investing is to not finding a good property but finding a great real estate agent or a land investment companies if you are buying land and establishing a relationship with them. Real estate agents have access to databases on residential, multi-family, commercial and foreclosure listings that you will not be able to find on your own fast. You can certainly browse through some free foreclosure listings but is it really a good way to kill time? Once you find several real estate agents, it’s worth presenting yourself as a prospective real estate investor looking for properties to buy. Specifying your price ranges, property areas and other important information will make you look credible in their eyes. In addition, professional real estate agents can help you write effective and solid property and land purchase agreements.

7. If you have little or no money, there are still a number of ways to land your first investment property. In today’s buyer market there are lots of sellers you paid too much money for their properties and can no longer sustain owning them. You can consider multiple ways of purchasing a property using one of the following, a wrap around mortgage, property exchange, renovations for purchase down payment, life estate and more. Additionally, you can partner up with another real estate investor and use partnership cash flow to fund future investments.

8. Take measures to improve your credit score. A high credit score is your pathway to getting loans at a much lower rate compared to individuals with a poorer credit. First, you need to review your credit report by requesting it online from one of three major agencies, Trans Union, Experian or Equifax. If the information there is not accurate, disputes must be filed in a timely manner. You might be tempted to apply to one of credit repair services or debt consolidators; it’s one of the worst things that could happen to your credit history. Paying your monthly bills on time regularly and keeping your debt load at a reasonable level should help you improve your FICO score over time. For individual with no credit history like young adults (recent high school graduates or college students), it’s highly recommended to get a credit card, paying bills on time, thus establishing a good credit history.

9. Find good tenants. Ultimately, the biggest part to success in real estate is finding people who are willing to pay you money to live in your properties. Doing a thorough criminal background check credit history and requiring a security deposit and first month’s rent in cash before tenants move in are probably three most important aspects on finding good renters. In today’s economy there’s a surplus of renters but not enough high quality residential housing people actually want to move into. However, don’t be too picky about your tenant selection by setting such high tenant standards that you cannot find people to fit into them. It’s OK to rent to families with pets but asking for a larger security deposit is your way to make up for potential repairs if necessary.

10. Re-invest cash flow or capital gains from sold properties into buying more houses or considering larger multi-family properties or perhaps land purchases, or government property for sale By doing this you are building a foundation of wealth that will result in more cash flow in the future.

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Buying a House With No Money Down

Buying a house with no money down is possible for many people, and there are a number of options that can help you manage this. Real estate investing has become very popular, and many individuals purchase homes each year. With a zero down payment the rate paid will be higher, but if you have excellent credit then this is not a problem as far as approval is concerned.

A land contract may also be arranged between the buyer and seller, and this method of buying a house with no money down may be possible regardless of your credit rating or credit history.

There are many methods and steps to buying a house, and some lenders advertise loans with no down payment required. If a seller is motivated and there is an existing mortgage then it may be possible to assume the mortgage, without the need for additional financing. This method of buying a house with no money down may require lender approval, and this may not always be an option for some home seekers. It is possible to take out a loan against your retirement account, and using 401k to buy a house outright is common. This will allow you to pay the entire purchase price, instead of making a down payment and then having a monthly mortgage payment.

If you have poor credit then the 30 year fixed mortgage rates my be outrageous, if you even qualify for this loan type. Your only option may be buying a house with no money down using alternative methods instead. The best thing to do is to evaluate all of the options that are available, and then choose which of them are the best in your specific circumstances and situation. If the best home mortgage lenders will not offer a loan with no down payment, do not despair, there are other ways to achieve home ownership.

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