Cash Heavy Businesses Have a Big Incentive to Buy at the End of the Year
How to Invest in Cash Incentive Real Estate
Frustrated with stocks, bonds or mutual funds and looking for a way to potentially make your wealth grow? Consider real estate investment, especially properties that are offering cash incentives from the owner or bank. Whether you fix them up and resell or use them as rental properties, you may be able to make a good amount of money in a relatively short period of time.
Researching Real Estate Investment Opportunities
Learn how real estate investments can be profitable.Research on the Internet at sites that focus on real estate education or get books from your local library or bookstore.Moneymagazine andForbesalso contain useful articles. Get up to speed on what is for sale in your local real estate market and visit all properties in your target price range.
Partner with an expert.For your first few deals, it would be to your advantage to partner with someone with experience in the real estate market and who has successfully "flipped" houses. (Flipping is buying a property in disrepair, fixing it up and then selling it for a profit.) Finding a mentor willing to advise you would also be invaluable.
Choose a real estate broker.As the seller usually pays the listing and selling real estate agents, it will cost you nothing to work with a real estate broker experienced in finding properties that are offering cash incentives. Ask others experienced in real estate investing for a referral, and choose someone based on ability to understand the investor's needs, availability to show the homes, likability, and knowing the markets.
- You can find details about a particular real estate brokers at the real estate company's website.
- You should also interview several brokers, just like an employer would interview job applicants and choose the one that meets your needs and criteria. You can prescreen beforehand to find out if they work with investors, what kinds of real estate they specialize in, what kind of availability per week they have, and anything else that is important to you.
Finding Properties With Cash Incentives
Search for properties that offer cash incentives and mortgage, maintenance or tax rebates.A good place to start is www.homepath.com, a resale marketing site. Fannie Mae, for example, lists thousands of properties they acquired through foreclosure. They occasionally offer cash incentives toward closing costs.
Learn what cash incentives are available to potential buyers.Ask the listing real estate agent or look for incentives that are mentioned in the property's For Sale ads. Seek out properties that have been on the market for a long time, or have something so badly wrong with them that the bank or seller is willing to pay you to purchase the property. Or you can suggest incentives during the negotiation process. Cash incentives may include:
- Cash-back offers. These could include offering to pay a year's worth of property taxes or mortgage payments. Other types of cash-back offers include credits for a down payment, repairs, landscaping, closing costs or mortgage points.
- Expensive gifts such as season tickets to sporting events, use of a vacation condo, gift certificates for high end purchases, golf club memberships and even mineral rights.
- Seller-financed carry-back loans which are mortgages or loans financed by the seller. Sometimes this is included with a zero down payment incentive. However, keep in mind that this can be a risky option if the seller does not transfer ownership or allow you to have the property recorded to your name. The property may not be transferred until a certain amount of money has been paid into it, so it is possible that the owner could foreclose on the property even if you are paying them every month.
Choose the property with the most potential for profit.The best type of property to buy is one that has a good roof and foundation but has been mismanaged and not cared for. Look for properties that have old carpet, peeling paint, cracked tile, dirty grout, leaking faucets, burned light sockets and broken windows. You can pay a handyman to fix these at about .00 in labor for each defect.
- You will save even more money if you learn to make some of the repairs yourself. Take an adult education class or get training from a friend or family member who has carpentry, plumbing or electrical skills. You can also check Youtube for skills training videos on just about anything.
Look for "distressed" sellers.These people are desperate to sell for reasons such as divorce, bankruptcy, death, an out-of-town new job, poor condition of the property, behind on payments, etc. They will be more open to sell below the market value or provide a price reduction to account for repairs that are needed. Your local real estate broker can help provide information on who might be in this situation.
Try searching for non-owner occupied homes.You can search the county site for properties that have non-owner occupied homes. These may be good sources of inventory to check out. You can also drive through neighborhoods to find vacant properties. Or, you can ask your realtor to provide a list of all vacant properties.
- Websites that offer “for sale by owner” listings and auction sites can be good places to check.
Avoiding Costly Mistakes
Ensure the property will appraise close to the price being offered.Your lender will do its own appraisal of the property and if an appraisal is not high enough, the investor can opt to put in a higher down payment. It will cost the same amount whether you hire your own private appraiser or the bank does its own appraisal, but it is not necessary to do both.
Ensure that the property will appraise or sell for more than you paid.Before you make your repairs and updates to increase the equity, check the details of local real estate ads that are similar in size and location to your property, known as "comps." Evaluate what they are selling for and how many bedrooms and bathrooms there are, square footage, and if the kitchen and bathrooms have been updated.
- This information will help you decide where to invest your money in updating your property. For example, if just about every property in the price range you expect for your property has an updated kitchen, you know you will have to do the same.
- A real estate broker can provide this information and advise you on what repairs and updates you will need to make. Your realtor can also provide comps and advise you on resale value after repairs have been made.
Be aware of the risks.Like any investment, investing in real estate is not risk-free. It is important to consider the potential risks before you invest in real estate. For example, you might find that a certain property is not worth the costs of maintaining it, or an unexpected disaster could strike and destroy the property. Take some time to consider the risks before you purchase a property.
- Cash incentive properties can often be purchased with as little as 5% down.
- Purchasing just two of these properties every year can result in instant equity of around 15% of the property value. For a property valued at 0,000, this translates to ,000 in equity.
Video: Real Estate Home Buyer and Seller Cash Incentives
SAY IT IN SONGTHE ULTIMATE GUIDE TO WEDDING MUSIC (INFOGRAPHIC)
I Dont Think My Baby Likes Me
Spiaggia dei Conigli, Lampedusa, Sicily
Top 20 Orange Hair Color Ideas of 2019 – Neon, Burnt, Red Blonde
9 Brilliant Backstage Beauty Tricks We Picked Up DuringNYFW
Mango, Passion Fruit and Coconut Ice Recipe
How to Remove Bathroom Tile
How to Spin a Psi Wheel
This Heated Blanket Plugs into Your Car for Super Warm Rides
City, Suburb, or Country: Does It Matter Where I Live With MS