2. Unlicensed Contractors
"I hired a guy who said he was licensed to make repairs to my kitchen. He started the work but never finished. I found out he isn't licensed and that he recorded a mechanic's lien against my house."
Never hire an unlicensed contractor.
3. Foreclosure Consultants
"When I got behind on my house payments, I started getting mail from people saying they could save my home. I signed a contract with a guy who promised to make up the back payments and help me get a new loan. He didn't do any of that. Instead, he sold my house to somebody else and now I'm being evicted."
If you're behind on payments, call your mortgage company and work out a payment plan.
4. High Interest Loans
"I thought I was getting a good deal on a refinance. Turns out, the interest rate is way too high and they charged me all kinds of junk fees."
Shop around for the best rates and fees before getting a new loan and make sure your read the fine print.
5. Adjustable and Fixed-Rate Loans
"The loan representative said I was getting a fixed-rate, 30-year loan. Six months later, my interest rate jumped more than 3%."
Review your loan documents before you sign. Interest rates must be disclosed by the lender.
6. Account and Billing Errors
"My mortgage company did not credit my account for the mortgage payments I've made."
Send a letter to your mortgage company requesting a payment history. Be sure to include your account number in the letter.
7. Illegal Rooms
"I just moved into the house I bought and the city tells me that some of the rooms were added without building permits."
You may be required to make changes. Be sure to check for building permits before you buy a home.
8. Repairs and Escrow
"Before I bought my house, the seller promised to make repairs. My agent said it was OK to sign and close escrow, even though the repairs were not done. It's been 3 months and the seller still hasn't made any repairs."
Make sure repairs are completed before you close escrow.
9. Property Taxes Not Paid
"My mortgage company was supposed to pay my property taxes but didn't. Now I owe past taxes and penalties."
Call your mortgage company for an explanation. If they don't take care of the problem, contact your state real estate commission.
10. Vacant Land Purchase
"I bought some vacant land in the desert to build a house on. The seller said there was water, sewers, electricity and phone service. Turns out, none of those are available."
Check with the local Building and Safety Department before you buy vacant land.
Take your time and do your homework. Property purchases are usually the biggest investment you can make. Take time to read all of the documentation and if you don't understand something, ask questions. If necessary, hire a real estate attorney to protect your interests.
1. Realize your Potential
In order to succeed as a real estate agent, you need to see that you have the potential to reach your goals.
2. Don't Look Back
Everyone has failures or mistakes from the past. To have success in the real estate industry, you need to learn from those past mistakes and learn valuable lessons from them. After doing so, simply move forward and make better, more educated decisions from the lessons learned.
3. Dare to Dream Big
To succeed as a realtor, you need to have big dreams and aspirations. Be honest with yourself as to what you want out of life and what you want to give of your life. Allow your mind to dream and think big!
4. A Powerful Business Plan
Create a powerful business plan that will organize your strategies. This plan will be the blueprint to your success. The business plan should include prospecting, listing strategies, prospect follow up techniques, networking ideas, and ways to boost customer loyalty.
5. Don't Give Up
To reach success as a real estate agent, you must persevere through difficult times. Even Thomas Edison had to learn this. When he was inventing the incandescent light bulb, it took him more than 10,000 times to get it right. Keep striving even when the challenge seems to be overwhelming.
6. Have an Unstoppable Attitude
You need to have determination in order to succeed as a realtor. Be wary of close friends or family members that feel it would be better if you focused your attention in another direction or career. Uphold your unstoppable attitude, determined to succeed.
7. Stop Complaining
You might think there is no correlation between complaining about you difficulties and success, but there is in fact a connection. When you spend time complaining about the obstacles you are facing in you real estate career, you're wasting so much time being negative that you are actually missing out on chances to move your career forward. Don't think of challenges as problems, think of them as opportunities.
Francis Stark #FrancisStark
The real estate bubble is not going to burst! The real estate market will, however, shift and the real estate market will change just as it always has! What's hot now may turn ice cold in the next 3 years (or perhaps even 3 months). But, there are ways to "bubble proof" your real estate investments. It's actually quite simple.
Did you know that in the United States, in 1975, the median home price was $33,300? In 2005, the median home price was $195,000. Historically, the average home doubled every 7 years. If you do the math, it should be well over $200,000.
OK Now, having said that, The real estate market WILL change and what is "working" today in real estate may not in the future. The rental market was strong a decade ago, but has been soft in recent years. We are getting ready for a turn once again.
Real Estate IS a cycle and cycles have some degree of predictability. With predictability, you can grow your real estate business into a cash-producing, profit-pulling machine that runs itself WITH the changing real estate market trends. It is still possible to make money in real estate. In fact, now is just as good a time as any to get started in real estate investing.
But, you've got to make wise investments. Sure, you may make some SERIOUS cash in pre-construction, but what happens if (no, not if when) the market shifts and there are suddenly 35 identical properties on the market for sale in the same building? How long can you afford to carry a negative cash flow on the property?
Or how about taking over property "subject to"? Sure, it's a great strategy and lenders may be inclined to turn the other way and not exercise the "due on sale" clause as long as the interest rates are at rock bottom prices (You know, those sellers that you're usually taking property subject to from usually don't have the lowest interest rates, right?) If the interest rates spike to 10-11%, don't you think lenders might be MUCH MORE inclined to exercise their option to make you pay off the 6.5% note?
What this means is simply that you must be experienced in the basics and the tried and true techniques, strategies and systems that have worked in the past, are STILL working and will work in the future. You've got to have all the tools in your bag so that you can go with the flow and not be affected when real estate markets begin to shift (which they are already in the process of doing, in case you've missed that memo! ;-)
Step #1 - Set your plan: Figure out what your long term real estate goals are (aka retirement and wealth building) and figure out what your short term needs are with regard to making money in real estate. Then, set up the proper entities and put the plan in place.
Step #2 - Determine what your target market will be: You cannot be all things to all real estate markets. If foreclosures appeal to you, start investing in the foreclosure market. If you want to be a landlord, look to out of state owners to focus your real estate marketing efforts.
Step #3 - Be consistent and persistent: Real Estate is not a get rich quick scheme. Real Estate is get wealthy over time and put some quick cash in your pocket today. You've got to follow your plan and stick with it to see real results in real estate. You've also got to continue to increase your education and your experience.
Step 4 - Don't fall into the "Analysis Paralysis": Learn to analyze properties quickly. Don't get caught up overthinking. It's quite simple actually: What's the property worth? What does the property need for repairs? And how much can you get the property for? It all comes down to numbers!
Step 5 - Become a master of finance!: Real estate is the business of marketing and finance. You must learn about mortgages and interest rates and loan programs that are out there. You must know how to use finance to negotiate your deals and to sell your properties.
Step #6 - Become a skilled problem solver: The reason you will get real estate deals that others don't, is because you are able to solve people's problems. Anything goes on the real estate playing field. You've got to be ready!
Step #7 - You must continue your education: It is important that you are always investing in your education and learning new tactics, strategies and tips that will help you make more in real estate.
Francis Stark #Francis Stark
Time is precious and you can't get it back, so it needs to be used wisely. For those of you who have limited time or don't have much of a desire to network, but you know you have to, try Target Networking for Real Estate coaches. As you target your work market for clients, you can target or focus your networking market using the same skills.
As an example, what if your target industry is real estate? Your target markets could include the bank, mortgage, real estate and insurance companies. Your target audience then becomes banking executives and mortgage brokers, real estate brokers and real estate and insurance sales people.
What do next? Follow these 7 methods to Target Networking success for your Real Estate Coaching career.
1. Research these audiences in your area, determine their association meeting places, and invite yourself as a guest.
Remember, the smaller the niche, the bigger the reward. If you go deep within your industry, you become the expert in your field and the possibilities are endless.
2. If part of your marketing plan is speaking presentations, you could also get yourself a free booking at any of these organizations with your target audiences. Yes, I said free.
If you are willing to spend your time milling about an obscure cocktail party venue with unknown quantities, you could easily put together a 30-minute presentation in front of your entire market. You will create new relationships, save time and make more money.
3. Here's the drill. Grab your yellow pad and let's get going!
A. Use one page at a time and place the sample industry, Real Estate, in the center.
B. Without conscious thought, jot down anything that comes to mind in relationship to Coaching in the Real Estate industry. You can help these people in many ways.
C. Your final document, or at least one of them, should look like a sunburst, with your industry, the sun, and your market, the rays.
D. You could extend this piece even further by adding another dimension, your audience. The sun is the industry, with lines as the sun's rays representing your market and lines of these representing your audiences.
4. Check your local business newspapers for anything close to what you have chosen. Refer to the yellow pages if you're not familiar with these publications or associations.
5. When you get a copy of these business newspapers, check their calendars for meetings in your industry or market.
6. Visit your local Chambers of Commerce, check the membership list and get brochures of businesses in your target industry, target market and target audience.
7. Go to the reference section of your business library and review the Major State, Regional and National Trade and Professional Associations of the United States.
The Association books have subjects by index, so if you did this today and went to "Real Estate, National", you would discover a minimum of 60 associations! This does not even include State & Regional.
So, pick up that phone, start dialing and enjoy Target NetworkingÆ for Real Estate Coaches. With this exercise, you will have a major part of your year's marketing and networking successfully managed.
You will be the only Real Estate Coach in the room, get the clients that are truly in your target market and make that drive and all your efforts worthwhile.
Francis Stark #FrancisStark
When you are ready to buy your own house, be sure you understand your rights as a homebuyer. Knowing the process of buying a house prevents you from getting scammed. You can personally do your home work or seek for a knowledgeable person like a real estate agent or a broker. Make sure that the agent you hire is licensed and have a wide knowledge regarding the area.
2. Make sure you can afford it
Your budget is really a big deal in buying your own house. What you want is different from what you need, so be practical. You don't really need a big house if you're just one person that travels everyday, right? Make sure that you make the best for your money. Seek help or ask for suggestions especially for those who have knowledge in real estate prices. If you can't stay for at least a year, buying a house is inappropriate for you. You may save a whole lot more of money if you sell it urgently.
3. Make sure it fits your lifestyle
Make your house a home. Be sure it really fits your way of life and you are comfortable with it. A good example of this is if you're working in an office, a good place to find is near or in the vicinity of your office. If you love nature, a good place to find is outside the city with clean air, near parks, has a mountain view or near at the beach. Your personality really matters in finding a good house. Make sure to look at its suburbs first and try to gather some information about the area and its surroundings. Try also to consider the kind of neighbors you will have.
4. Consider your future plan
If you're newly married, you might to consider how many kids you want to have. You can assume the number of rooms or the home space you need. If you can afford a house that is near to a good school, it is better. School districts are more important to home buyers, therefore, it will increase your property values.
5. Be organized
It is very important to make your document files organized and safe. Because it will prove that you own the house. It will help you a lot especially when it comes in paying your house payments (taxes and amortization).
Francis Stark #FrancisStark
2. Get an inspection on the home - Get a complete inspection done on your property. By spending a few hundred dollars on this expense you can save thousands in problems that you cannot see. Foundation, Pest, Wood Rot, Etc... By getting a full inspection you can rest assured that you know every thing that is wrong with the property before it's too late. In the contact for the house you need to make sure that you have 7 days to have an inspection preformed, and if the inspection finds problems that are going to cost more money that you are willing to spend you can get out of the contract with no penalties.
3. Don't do the work yourself: - Get a contractor or several sub-contractors and have the work done quickly. You need to have you house flipped ASAP, so that you can get it on the market and get it sold. When I started flipping my brother and me did a house together, and we did all the construction. I had a construction background and figured it would save thousands, but it took us over 4 months to get the work done that a contractor could have had the work done in a month. But, we trying to save money on our flip did all the work on our time off and after work, and it just took too long. On our 2nd flip we used contractors for almost everything and had the house completely flipped with a new roof, new air conditioning, new hardwood, and much more in only 3 weeks. We did not have to spend all our time working on the property and were able to spend that time looking for the next deal. This is how you get rich in real estate.
4. Place the property 1 to 2 percent below market value: If you are wanting to flip real estate and make money the object is to buy and sell the property as quickly as possible, so that you can move on to the next house. If you purchase a house and try to sell it at top dollar to make and extra couple of thousand dollars on your flip, and end up holding it for 6 months you are loosing money. Get the house on the market at a price that is going to blow the competition away, and you will sell it no matter what the market conditions. On our second house the market for selling house went down do to the housing market as a whole, and the tightening of the loans across America. We were told that you could not sell a property in this market, but we went ahead anyway and flipped our house. After 3 weeks on the market we had 3 people wanting to buy the house. Why, because we offered it at such a great deal that people wanted to jump on it. That is what you have to do especially if the market is slow.
5. Use a real estate agent - Do not try to sell you house on your own. Harness the power of a real estate agent and the power of the MLS system. When you do a FSBO you are depending on people driving by your house and seeing you sign, with a real estate agent you have some one actively marketing you house to get it sold. Once again this will free up more time for you to look for more great deals. If you want to help the process I have found that craigslist and listing you house in google AdWords help too, but I use these tools with the help of an agent to make sure I have all my bases covered.
I hope this article has been helpful with the basics needs of flipping a house. If you will study and learn you will make money. But, do your homework before you purchase a house, and make sure that you can pull a profit on your deal. Then, make it happen!
Francis Stark #FrancisStark
Making the wrong decision in buying a home can have devastating and long lasting effects, while making a wise decision in home buying can greatly enhance the overall value of the investment. It is necessary to learn all you can about the world of home buying and mortgages before setting out to purchase the home of your dreams.
While there are plenty of web sites designed to help first time homeowners learn all they can, most financial experts say that there is no substitute for the good old one-on-one learning. Fortunately, most mortgage lenders, home inspectors and real estate agents will be able to provide this kind of one-on-one learning.
When buying a home it is often best to use a systematic approach as this is often the best way to be sure that all decisions are based on information and reason, not on impulse or emotion. Buying a home can be an emotional process, nevertheless it is imperative to keep your emotions under control and not let them cloud your judgment.
There are five basic ground rules when it comes to buying a home and shopping smart, and they are:
#1 - Get your financing before you get your home
There are few things in life as disappointing as losing out on the home of your dreams due to not being able to secure funding. While the desire to get out there are search for that great home is understandable, it is vital to line up the financing you will need before you start shopping for a home.
Getting the financing ahead of time has a number of important advantages, including knowing how much you can buy and gaining more respect from the listing agents. By knowing how much home you can afford before you shop you will avoid wasting your time looking at unaffordable properties, and the listing agent will be more than willing to show you the homes in your price range.
It is also important to take a good look at the various types of mortgage on the market before getting started in the home buying process. These days, mortgages come in far more choices than the typical 15 or 30 year. For that reason, potential home buyers need to understand how each type of mortgage works, and to gauge which mortgage is the best choice for their needs.
#2 - Look at the community, not just the home
It is a good idea to look at the entire community, instead of focusing on a single home. This can be a particularly important thing to consider for those moving to a new metropolitan area, as these buyers will be unfamiliar with the local climate and lifestyle. It is crucial to determine the areas of town that are most desirable, and to consider things like distance from work and local shopping opportunities.
We have all heard that location is the key consideration when it comes to real estate, and that is certainly the case. Buying a house in the wrong area can be a big mistake, and it is important to choose the location as well as the home. Potential buyers can learn a great deal about the nature of the various neighborhoods simply by driving around town, as well as by talking to other residents.
#3 - Be fair with your first offer
Trying to lowball a seller on the first offer can backfire, as can paying too much. It is important to carefully evaluate the local market, and to compare the asking price of the home with what similar houses in the neighborhood have sold for.
Comparing the sales of comparable homes, what are known as "comps" in the industry, is one of the best ways to determine what is fair, and to make sure that you neither overpay or underbid on the property.
#4 - Always get a home inspection
Always investigate the home for any possible defects before making an offer. Compared to the cost of the average home, the price of a quality home inspection is virtually negligible. Hence, get a good home inspection done before you buy.
To find the best home inspector, it is a good idea to seek out word of mouth referrals as many of the best home inspectors rely on word of mouth advertising.
#5 - Do not alienate the sellers of the home
Many real estate deals have fallen apart due to the personal animosity of the buyer and the seller. It is important to avoid alienating the seller of the home during the process, and to avoid nitpicking every little detail during the sale.
Keeping the good will of the seller will help the transaction go smoothly, and it will provide the best environment for seller and buyer alike.
Francis Stark #FrancisStark
Here's a quick plan that will enable anyone to begin building financial independence.
There are basically four steps to investing in single family homes:
1. Buy homes below full market value. Yes, people really do sell homes for less than the home's full value. The key is to understand that most home owners will only consider a purchase offer that is all cash and within 5% to 10% of their asking price.
The successful investor learns to find financially distressed home owners who have no choice but to sell for less than market value. They have lost their job or been suddenly transferred; they are divorcing; they been living beyond their income; the family has been overwhelmed with medical bills and, not uncommonly these days, their money has gone to support a drug habit.
Those are examples of motivated sellers. They have to sell and they will accept something other than a conventional, all cash offer.
2. How do you find motivated sellers? You work at it! Like any business it is important to develop a little marketing plan. One that is simple, yet very effective, is the one that was proven 75 years ago by the Fuller Brush company; door to door sales.
You are selling your skill as a home buyer to people who must sell. Your are there when they need you and you have the skill to help them solve at least part of their problem. With door to door prospecting you will learn more and buy more homes quicker than any other method. However, most people just won't walk door to door for three or four hours per week. OK, there are other ways.
You can watch public notices for the announcement of foreclosure sales. Meeting with a home owner right after they've received a notice that they are about to lose their home allows you to deal with a very motivated seller. Other public notices that provide buying opportunities include probate, divorce and bankruptcy. You can follow the Homes For Sale listings in your local newspaper or Internet site.
You can telephone the names found in these notices or, and this is the least time consuming, send a postcard expressing your interest in buying their property. It will produce buying opportunities, just not as many as personal contact.
3. After you've found a motivated seller you must understand how to frame offers that provide benefits for both you and for the home owner. A good real estate investor quickly learns that this is not a business of stealing property, but of solving problems in a way that benefits the seller.
The home owner is in a tight spot of some kind and you can save them from public embarrassment and, in most cases, give them at least a little cash to get a new start.
No investor can afford to leave cash in every deal. No one but Bill Gates has that much available money. You must use creative techniques like, leases, option and taking over mortgage payments. Little or no cash is needed for those deals. You can find plenty of reasonable priced educational material on those subjects in book stores or on EBay. The same education that seminars sell for thousands of dollars.
4. You make your profit when you buy! Never make a purchase until you've carefully determined exactly how you will get to your profit. If you hold it as a long term investment will the monthly rental income more than cover the monthly mortgage payment? Will you sell the deal to another investor for fast cash? Will you do some fix-up and sell the property for full value? Will you quickly trade it for a more desirable property? Have a plan before you buy.
There you have four steps that even a part-time investor can execute in three to four hours per week. What's the missing ingredient? Your determination and perseverance. If you will unfailingly follow the plan for a few months you will be well on your way to financial independence.
Francis Stark #FrancisStark
2. Renovation Expenses. You may have purchased a "fixer upper" at a bargain rate. Once your project is complete will you be able to recover the expenses and make a profit especially if the value of your renovated property is above those in your neighborhood? In addition, can you withstand a correction in real estate values?
3. Insurance and Mortgage Costs. You will pay more for homeowners insurance if you do not occupy the residence and you have tenants. If you are financing the property you know that your mortgage rate is higher as well.
4. Rental Pressures. A market saturated with rentals will mean that the rents you can charge will be less than what you had hoped to receive. In some markets you are required to get special licensing in order to be a landlord. In other markets the legal rights of tenants mean you could have a lengthy and expensive battle in ridding yourself of a bad tenant. Will the lower income levels coupled with the added expenses drag your investment down?
Of course, you can limit your risks [and costs] by doing the majority of the upgrades yourself, appealing excessive property tax increases, and finding for yourself a trusted and dependable tenant. It isn't easy flipping a home, but with a lot of pluck and determination it can result in strong profits for you.
Francis Stark #FrancisStark
1. Go stand on the street to see what clients see when driving up to the house. Be aware that any negative impressions they get outside the house (landscaping not maintained or non-existent, peeling paint, etc.) is just going to make them think that the house itself has not been well taken care of. So even if you have spent the time and money to fix up the interior, it would all be wasted if the clients get a bad first impression as they drive up to the house.
2. Next, step outside your front door and close the door; then stand on the stoop and look around for 5 minutes. While the realtor fumbles for keys and tries to figure out how to open the door, the clients are standing behind and looking around. So what are they seeing? Dead plants, old Halloween decorations in the middle of January, cobwebs? Again, not a good first impression!
It's definitely worth it to take some time and clean it up. Want to go a step further? Try a new coat of paint or some new furniture or accessories.
3. Don't forget the backyard. While that might not be part of the potential buyer's first impression experience, you still should make sure it's in the best condition possible. Pull up weeds, water plants, do some sweeping (if that's applicable in your case) and maybe even purchase new furniture or accessories (plant pots, bird houses, etc.)
And the biggest tip of all? Imagine yourself as a potential buyer looking at your property for the very first time. What impressions are you getting? Would YOU buy your house? What would you like to see changed before you put an offer on your house?
And don't worry about spending several thousand dollars to get your house ready to sell ñ you'll get it all back when your house sells. Proper staging helps you sell your house in a shorter time and at the price you want.
Francis Stark #FrancisStark
Become a Real Estate Investor
"Ninety percent of all millionaires become so through owning real estate. More money has been made in real estate than in all industrial investments combined. The young wise man or wage earner of today invests his money in real estate."