Real Estate Investing: How to
Get Started
By Jeanette Joy Fisher
The number one beginning real estate investors'
first question is: "How do I find a bargain
house to make money?"
Actually, their first question should be:
"How do I get financing?"
BEFORE you run all over town looking at houses,
talk to a loan officer and make sure you can get
financing. If you need to clear up any credit
issues, do this right away. If you have terrible
credit and want to make money investing in real
estate to pay off your debts, you can still get
financing. Look for a hard-money lender.
Don't waste your time with real estate agents
who tell you that it's too late to get into the
real estate boom. Find an upbeat, positive agent.
Also, don't limit yourself by signing a contract
with ONE agent. You don't want to pay them if you
find a home for sale by owner.
How to Find a Bargain House
Once you have your financing arranged, your
armed with power. Home sellers love buyers who can
close right away. This is paramount to getting a
seller under duress to sell you their home at a
bargain-basement price.
 |
 |
We purchased
this bargain home with a short escrow for
thousands under market value. |
To make a good profit in real estate, you must
buy right. Check out all property types available
to find the best transaction for your specific
situation. Consider fixers, distressed sales,
repossessions, multiple listings, for sale by
owners, and vacant properties just wasting away.
Distressed Properties
Recognize the difference between a fixer and a
distressed property. Distressed properties may be
fixers or just unwanted houses. Divorce, job loss
or transfer, death, financial difficulty, and
other problems often force a sale for less than
market value. Just because an owner's problem
causes a distressed sale does not mean the house
requires fixing.
Repossessions
Although the repossession market seemed dried up
last summer, houses are beginning to appear on
foreclosure lists again. This may be the beginning
of another real estate investor boom.
Look for great bargain properties for sale by HUD,
VA, Freddie Mac, Fannie Mae, and Bank-REOs (real
estate owned). Follow your local government-owned
properties and make many bids. The key to winning
ONE successful bid is frequent bidding.
Many real estate agents try to discourage you from
repos and switch you to multiple listed homes. Do
not listen to negative agents who tell you how
hard it is to find a bargain property. Find
another agent. Even in a hot market, when the
average house sold in less than three weeks, we
found two properties for forty thousand dollars
under market value.
REOs
Banks often offer their "real estate owned," REO
homes, at bargain prices. Depending on the bank's
resale policy, conditions of the property, and
available financing, REO opportunities vary
widely. Several banks lend on their repos while
other banks just want out. Great financing becomes
possible through the banks who offer in-house
terms. Ask for no points, minimal loan costs, and
no prepayment penalties.
Check with your local lending institutions and
find out how they market their repossessions. Many
of these bankers will give you their web page
listing available property. Befriend real estate
agents who specialize in listing bank-owned
repossessions so they will notify you of a new
listing immediately.
Multiple Listings
It is harder to find a bargain in multiple
listings, but not impossible. Look for
listings which have been on the market for awhile.
Look for vacant houses, because these cost the
seller money every month. Make an offer for much
less than asking price with a quick escrow. Many
anxious sellers jump on an offer if they think
they will be out of their problem in only ten
days.
Follow the multiple listings in your area on the
Multiple Listing Service. Ask your agent to emails
new listings daily. You need an agent who calls
you the minute a new distressed property listing
becomes available. Under-priced listings often get
snapped up by the real estate agents and their
investors before they get listed on MLS.
Just like making many HUD bids, make many offers.
You never know when a seller's problems reach a
critical point causing abrupt action.
For Sale by Owners
Houses for sale by owner may not always be a great
buy, but there is always at least one bargain out
there. Many investors prefer buying directly from
the owner. If you have ever tried to sell your
home by yourself, you probably met some of these
investors. Cruel, hard, and in some cases,
fraudulent investors dream up all kinds of schemes
to steal houses from distraught homeowners.
Understand that the home seller most likely dealt
with these callous investors before you and
therefore may view you with suspicion. Earn their
trust by working with them with honestly and
compassion.
Bargain houses offer you the fastest way to gain
instant equity. Check out your local market to see
what types of available bargains await your
winning offer.
Copyright © 2006 Jeanette J. Fisher
Jeanette Fisher, author of interior design,
real estate, and credit books teaches five ways to
make money investing in real estate.
Jeanette is the only author to reveal interior
design secrets to fixing houses.
Free ebook, The Truth about Making Money
Flipping Houses.
Fixing &
Flipping Houses
Permission granted to publish this article as
long as the bio remains intact with a live link to
http://www.doghousetodollhousefordollars.com
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Jeanette Joy Fisher