.
It’s not possible to list any specific, universally applicable rules to guide the real estate investor. There are far too many different types of real property – ranging from single lots in uninhabited areas to entire complexes of residential, industrial or commercial buildings. The rules investors follow – or should follow – vary widely according to the type of property involved, the use which is to be made of it and local and even individual considerations. Nonetheless, there are some general rules and pointers which provide a valuable checklist of things to do – and not to do – for anyone who is thinking of making an investment in any kind of real estate.
1 ) Make a thorough study of the real estate market and it prospects in your area before you buy. Naturally, you should seek to buy when prices are low and the indications are that values will rise. Always take into consideration such factors as the rate of population increase and the general prospects of business in the area. There is no quicker way to lose money in real estate than by investing it in property located in declining areas.
2 ) Know or learn as much as possible about every aspect of the particular use to which you intend putting the property you wish to buy. In other words, don’t buy a house unless you’re certain that it’s suited to the requirement s of your family and that it’s well built. Don’t plan on having a house built unless you know something about building - or at the very least until you’ve found an architect and a building contractor in whom you have complete confidence.
3 ) Deal only through licensed and reputable real estate brokers. Beware the fast-talking, high pressure real estate salesman who promises everything – verbally. He is probably a fly-by-night who doesn’t much care what he sells you or anyone else.
4 ) If you buy a property with a view to improving it, or building on it, be certain that you have adequate capital or are able to obtain adequate financing to complete the project.
5 ) If at all possible, always obtain at least one impartial, third-party appraisal of any property before you buy it.
6 ) If buying a building of any kind – be it a Cape Cod cottage, 1000-room hotel or Willow Run-size factory – have it inspected carefully by qualified and disinterested architects or builders before entering into any building commitments. If buying an existing income property such as an apartment house, have the owner’s books checked by a disinterested accountant. If the owner of the building or income property balks at such inspections, look out.
7 ) Whether you’re in the market for a cabin site or a skyscraper, shop around widely and cautiously. Unless you happen to run across an irresistible bargain, you must snap up immediately, take your time about making up your mind. Don’t allow yourself to be stampeded into paying any deposits or binders until you’re absolutely certain you’ve found the property you want. Remember that the purchase of real property usually involves heavy capital investment; don’t take unnecessary chances with your money.
8 ) Make certain you have the best available legal advice before signing any agreements, contracts or other documents. I don not mean to suggest that there is anything dishonest or misleading in the majority of such documents. On the other hand. few laymen are able to follow the labyrinthine mazes of legal terminology which are used in them. To avoid misunderstandings, it is always best to have an attorney transate the “whereas”-studded fine-print clauses into coherent everyday English. Even seasoned real estate investors sometimes fail to have this done – and the ensuing squabbles between buyers and sellers, usually wind up in courtrooms.
9 ) Always insure the title to any property you buy. Even the most meticulous title search may fail to turn up all the pertinent facts about the history of a property. The cost of title insurance is negligible. The expense of fighting a lawsuit over a clouded title can be staggering 0 as many real estate investors, I among them, have discovered to their regret.
10 ) Once you’ve bought your property, treat it as a long-term investment, not as a short-term speculation. You’ll find profits that way. Inf fact, if you wish to make money in real estate, always think in terms of investing and never in terms of speculating.
These ten pointers do not, by any means, comprise an all-inclusive guide to successful real estate investment. Nor does the individual who follows them – however faithfully – have any guarantee that he will make a profit when he invests his money in real property.
But, I believe that the person who observes these rules goes a long way toward eliminating a significant portion of the most common dangers inherent in any transaction involving real property. And that, in itself, is sufficient to give him a head start on the road to successful real estate investment. *
The above is excerpted from Getty’s book, How to Be Rich courtesy of Eric Johnson of Expanse Financial, Inc. and The Financial Independence Project, Inc.
If you’re going to be financing the purchase of real estate, only do it after carefully analyzing your current resources, preferences & financial goals. If you’re ready to engage in a make-sense financial transaction that serves these three areas optimally. Call me directly for a private discussion of your situation and intentions. Meetings by appointment only.
Eric Johnson, President
Expanse Financial, Inc.
The Financial Independence Project, Inc.
941.713.9307 Voice
MoneyNFLA@aol.com
A possible solution which could save the home and a family’s security may be a mortgage loan modification. A mortgage loan modification is a renegotiation of the loan terms with the lender or servicer.
To qualify for a mortgage loan modification, the homeowner needs to have suffered a hardship. A hardship can occur due to a rate change on a loan, a personal matter such as a divorce, job change, illness or disability or it may even be that the buyer was placed into a lona that they could never could afford by an unscrupulous broker. The purpose of a loan modification is to help make the monthly loan payments more affordable. Usually it is in the form of a rate reduction and fixing the rate for a certain amount of time. It may even include an interest only period or reduction in the principal amount owned.
In the past, a refinance was an option, but with the declining market and tight underwriting requirements, that is not usually an option. Now the banks and servicers realize they must work with homeowners for a loan modification. A loan modification does not require “closing costs” like a refinance option; it’s a restructuring of a current loan. Also, lenders do not want to own homes. Studies show that lenders lose fifty (50%) of the value of your mortgage in a foreclosure. Also, recently announced government sponsored incentive programs make loan modification a sensible and attractive option for lenders and a solution for home owners.
The price of residential real estate has fallen significantly. In some areas of the country, prices have fallen more than 30%. Many homes are actually worth less than the loans that were made on them. Foreclosing on this unprecedented volume of real estate is both time consuming and expensive for lenders.
Under these very unusual circumstances, lenders are beginning to realize that it makes a lot of sense for them to try to work with the current homeowner. Ironically, modifying the loan terms to make the loan affordable to the current homeowner can save the lender many thousands of dollars. The important thing to realize is that at this stage, anything that the lender is willing to do is voluntary. The lender does not have to modify the loan terms! If it were not for the unique environment we are experiencing, it is unlikely that the lender would modify loan terms at all, but mortgage loan modifications are being negotiated all over the country and helping families to remain in their homes.
If you’d like to see if you qualify for a mortgage loan modification, the Certified Credit Consultants (CCC) of Credit Justice Services can help. Contact a local CCC today and ask about how easy it is to apply today to get on the road to recovery.
Fannie Mae & Freddie Mac currently own billions of mortgages in this country. Again, they OWN these loans. In their ever so generous way, they’ve announced that they’ll allow many borrowers with rates over 5.50% to REFINANCE under certain guidelines. How kind of them. Please understand what I just wrote. They’ll ALLOW certain borrowers to “REFINANCE” which entails a higher loan balance by adding closing costs and fees to the lenders, brokers, title insurance companies, credit agencies and appraisers IF these certain borrowers can justify their income, credit, payment histories etc. We’re talking about loans that are already on the books. In addition to all the fees the borrower now has to deal with adding MORE years to their loan. Translation: More interest to be paid to the owners of the loans. Now, here’s the question homeowners should be asking: “If Fannie or Freddie already owns the loan…AND they’re going to get the NEW LOAN too, why not, just do a MODIFICATION of interest rate instead of encouraging a whole new refinance transaction with all of it’s additional costs etc?” In other words, “why not do something FOR the borrowers and homeowners instead of something for the banking and credit industry?” Here’s a corollary question: “Why not just unilaterally lower everyone’s payment across the board instead of only a select few?” The answer came to me this week while I was talking to a wholesale representative of a VERY large bank. The answer when I posed these questions was “To help the banks and their originators earn more money.” Again, the ‘bailouts’ and measures ostensibly to benefit homeowners is really a cover to benefit industry and corporate interests. Because the ‘Feds’ have stepped in to regulate Freddie Mac and Fannie Mae and ‘run the show’ shouldn’t they be doing something for the people….finally? I’m afraid, like usual, this is just more evidence of the fact that the banking industry owns Washington. I’m remiss that I didn’t see through this charade years ago.
Incidentally, were YOU aware that the “Federal” Reserve is not Federal?? As excerpted from G. Edward Griffin’s book referring to the “Federal” Reserve entitled The Creature From Jekyll Island, he says of the Fed: “It is an association of the large commercial banks which has been granted special privileges by Congress. A more accurate description would be simply that it is a cartel protected by federal law.” It makes more sense now when you hear that the government along with Fannie, Freddie and the Federal Reserve are just helping all the good ‘ole boys on Wall Street and in the banking business…and screwing homeowners.
For Financial Consultation of any kind including prudent real estate acquisition and mortgage financing strategies, Eric Johnson can be reached at 1.888.390.5697 or MoneyNFLA@aol.com
Q. What kind of Borrower qualifies for a mortgage loan modification?
A. Each lender has its own policies, but the general requirement is that you have a job and be able to prove a financial hardship. This tells your lender two things:
1. Falling behind in your monthly payments wasn’t entirely your fault
2. Modifying your loan can really help you back on your feet.
Q. What is a good example of a modifiable loan?
A. Anyone in financial trouble may be helped, but certain conditions can make our job easier. Ideal clients are those who:
- behind in payments or are already in foreclosure
- have received a notice of default
- have an adjustable-rate mortgage that has already increased
- have negative amortization loans
- are experiencing financial hardships due to bad or predatory lending, income reduction or illness or other “hardship”
- steady source of income to pay the modified payment
The “Text Book” file is a mortgage holder that has an adjustable rate mortgage (ARM) and is having trouble making payments after the adjustment or foresees a problem after the adjustment happens. All types of loans can be modified: ARM’s, negative amortizing loans, interest only loans, investment or commercial property.
Q. Can unemployed homeowners be helped?
A. No. You need a source of income to qualify for mortgage loan modification.
Q. Do you count the income of people who are living in the home but are not on the title?
A. Yes. The total income of the household is considered, not just the homeowner’s income.
Q. I need financial help paying the mortgage payments that are behind. What are my options?
A. Many people think they need to pay off their debts before they can try anything else. That’s simply not the case. Mortgage modifications can be very powerful and very flexible. During a modification, it’s possible to eliminate back payments you owe in addition to lowering your monthly bill.
Q. Do I need to be delinquent or behind in my mortgage?
A. No, but it will make things easier. Loan modification is meant to help people in financial hardship, and banks are more willing to help borrowers in trouble and that typically means you are behind in your payments.
Q. I’m already behind on my mortgage payments, is there anything I can do?
A. There are always options. If you’re behind on your mortgage, you may be a perfect candidate for a loan modification. It can help save you money by lowering your mortgage payments and stop foreclosure process that may be threatening your home.
Q. Is it too late to help clients who are in foreclosure?
A. Definitely not! Foreclosure can be prevented up to a few days before the actual transfer sale date. However, if you are thinking of getting help, please don’t wait until you have received a notice of sale. It’s important to take action.
Q. Can you help me stop foreclosure?
A. In most cases, help to starve off foreclosure is achieved by negotiating with your lender or servicer. Remember they do not want to own your home. That is a lose-lose situation. A hold can generally be put on your foreclosure status, but you’ll need to act quickly. The sooner you begin working on this issue, the easier it will be to stop the foreclosure process - even if you’ve been in the foreclosure process for a while.
Call 904-757-0880 for more information and to see if you qualify for mortgage loan modification.
view all blog entries...
Apr 2009
J. Paul Getty
Billionaire Reveals Rules for Investing in Real Estate!!
by valeria on Tue Apr 07, 2009 7:11 pm
It’s not possible to list any specific, universally applicable rules to guide the real estate investor. There are far too many different types of real property – ranging from single lots in uninhabited areas to entire complexes of residential, industrial or commercial buildings. The rules investors follow – or should follow – vary widely according to the type of property involved, the use which is to be made of it and local and even individual considerations. Nonetheless, there are some general rules and pointers which provide a valuable checklist of things to do – and not to do – for anyone who is thinking of making an investment in any kind of real estate.
1 ) Make a thorough study of the real estate market and it prospects in your area before you buy. Naturally, you should seek to buy when prices are low and the indications are that values will rise. Always take into consideration such factors as the rate of population increase and the general prospects of business in the area. There is no quicker way to lose money in real estate than by investing it in property located in declining areas.
2 ) Know or learn as much as possible about every aspect of the particular use to which you intend putting the property you wish to buy. In other words, don’t buy a house unless you’re certain that it’s suited to the requirement s of your family and that it’s well built. Don’t plan on having a house built unless you know something about building - or at the very least until you’ve found an architect and a building contractor in whom you have complete confidence.
3 ) Deal only through licensed and reputable real estate brokers. Beware the fast-talking, high pressure real estate salesman who promises everything – verbally. He is probably a fly-by-night who doesn’t much care what he sells you or anyone else.
4 ) If you buy a property with a view to improving it, or building on it, be certain that you have adequate capital or are able to obtain adequate financing to complete the project.
5 ) If at all possible, always obtain at least one impartial, third-party appraisal of any property before you buy it.
6 ) If buying a building of any kind – be it a Cape Cod cottage, 1000-room hotel or Willow Run-size factory – have it inspected carefully by qualified and disinterested architects or builders before entering into any building commitments. If buying an existing income property such as an apartment house, have the owner’s books checked by a disinterested accountant. If the owner of the building or income property balks at such inspections, look out.
7 ) Whether you’re in the market for a cabin site or a skyscraper, shop around widely and cautiously. Unless you happen to run across an irresistible bargain, you must snap up immediately, take your time about making up your mind. Don’t allow yourself to be stampeded into paying any deposits or binders until you’re absolutely certain you’ve found the property you want. Remember that the purchase of real property usually involves heavy capital investment; don’t take unnecessary chances with your money.
8 ) Make certain you have the best available legal advice before signing any agreements, contracts or other documents. I don not mean to suggest that there is anything dishonest or misleading in the majority of such documents. On the other hand. few laymen are able to follow the labyrinthine mazes of legal terminology which are used in them. To avoid misunderstandings, it is always best to have an attorney transate the “whereas”-studded fine-print clauses into coherent everyday English. Even seasoned real estate investors sometimes fail to have this done – and the ensuing squabbles between buyers and sellers, usually wind up in courtrooms.
9 ) Always insure the title to any property you buy. Even the most meticulous title search may fail to turn up all the pertinent facts about the history of a property. The cost of title insurance is negligible. The expense of fighting a lawsuit over a clouded title can be staggering 0 as many real estate investors, I among them, have discovered to their regret.
10 ) Once you’ve bought your property, treat it as a long-term investment, not as a short-term speculation. You’ll find profits that way. Inf fact, if you wish to make money in real estate, always think in terms of investing and never in terms of speculating.
These ten pointers do not, by any means, comprise an all-inclusive guide to successful real estate investment. Nor does the individual who follows them – however faithfully – have any guarantee that he will make a profit when he invests his money in real property.
But, I believe that the person who observes these rules goes a long way toward eliminating a significant portion of the most common dangers inherent in any transaction involving real property. And that, in itself, is sufficient to give him a head start on the road to successful real estate investment. *
The above is excerpted from Getty’s book, How to Be Rich courtesy of Eric Johnson of Expanse Financial, Inc. and The Financial Independence Project, Inc.
If you’re going to be financing the purchase of real estate, only do it after carefully analyzing your current resources, preferences & financial goals. If you’re ready to engage in a make-sense financial transaction that serves these three areas optimally. Call me directly for a private discussion of your situation and intentions. Meetings by appointment only.
Eric Johnson, President
Expanse Financial, Inc.
The Financial Independence Project, Inc.
941.713.9307 Voice
MoneyNFLA@aol.com
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Mortgage Loan Modifications Offer Road to Recovery
One million families will face losing their homes to foreclosure this year. One out of every 440 homes received a foreclosure filing in February of 2009. In Las Vegas, NV, one in 60 homes received a foreclosure filing in February of this year. In Florida, second to California for foreclosures in the country, the number of foreclosures since January of 2009 has increased by 14%.
by valeria on Mon Apr 13, 2009 8:11 pm
A possible solution which could save the home and a family’s security may be a mortgage loan modification. A mortgage loan modification is a renegotiation of the loan terms with the lender or servicer.
To qualify for a mortgage loan modification, the homeowner needs to have suffered a hardship. A hardship can occur due to a rate change on a loan, a personal matter such as a divorce, job change, illness or disability or it may even be that the buyer was placed into a lona that they could never could afford by an unscrupulous broker. The purpose of a loan modification is to help make the monthly loan payments more affordable. Usually it is in the form of a rate reduction and fixing the rate for a certain amount of time. It may even include an interest only period or reduction in the principal amount owned.
In the past, a refinance was an option, but with the declining market and tight underwriting requirements, that is not usually an option. Now the banks and servicers realize they must work with homeowners for a loan modification. A loan modification does not require “closing costs” like a refinance option; it’s a restructuring of a current loan. Also, lenders do not want to own homes. Studies show that lenders lose fifty (50%) of the value of your mortgage in a foreclosure. Also, recently announced government sponsored incentive programs make loan modification a sensible and attractive option for lenders and a solution for home owners.
The price of residential real estate has fallen significantly. In some areas of the country, prices have fallen more than 30%. Many homes are actually worth less than the loans that were made on them. Foreclosing on this unprecedented volume of real estate is both time consuming and expensive for lenders.
Under these very unusual circumstances, lenders are beginning to realize that it makes a lot of sense for them to try to work with the current homeowner. Ironically, modifying the loan terms to make the loan affordable to the current homeowner can save the lender many thousands of dollars. The important thing to realize is that at this stage, anything that the lender is willing to do is voluntary. The lender does not have to modify the loan terms! If it were not for the unique environment we are experiencing, it is unlikely that the lender would modify loan terms at all, but mortgage loan modifications are being negotiated all over the country and helping families to remain in their homes.
If you’d like to see if you qualify for a mortgage loan modification, the Certified Credit Consultants (CCC) of Credit Justice Services can help. Contact a local CCC today and ask about how easy it is to apply today to get on the road to recovery.
How the Feds and the Banking Industry are Screwing Homeowner
As many of you know, I own a mortgage brokerage firm in Florida and have been in this industry for the past 15 years. As we all know, many homeowners are seeking payment relief and looking for the best rates to lower their payment obligations especially in light of the well publicized economic situation. Here’s the latest silliness that will benefit the banking industry and money lenders at the expense of homeowners.
by valeria on Mon Apr 20, 2009 9:27 pm
Fannie Mae & Freddie Mac currently own billions of mortgages in this country. Again, they OWN these loans. In their ever so generous way, they’ve announced that they’ll allow many borrowers with rates over 5.50% to REFINANCE under certain guidelines. How kind of them. Please understand what I just wrote. They’ll ALLOW certain borrowers to “REFINANCE” which entails a higher loan balance by adding closing costs and fees to the lenders, brokers, title insurance companies, credit agencies and appraisers IF these certain borrowers can justify their income, credit, payment histories etc. We’re talking about loans that are already on the books. In addition to all the fees the borrower now has to deal with adding MORE years to their loan. Translation: More interest to be paid to the owners of the loans. Now, here’s the question homeowners should be asking: “If Fannie or Freddie already owns the loan…AND they’re going to get the NEW LOAN too, why not, just do a MODIFICATION of interest rate instead of encouraging a whole new refinance transaction with all of it’s additional costs etc?” In other words, “why not do something FOR the borrowers and homeowners instead of something for the banking and credit industry?” Here’s a corollary question: “Why not just unilaterally lower everyone’s payment across the board instead of only a select few?” The answer came to me this week while I was talking to a wholesale representative of a VERY large bank. The answer when I posed these questions was “To help the banks and their originators earn more money.” Again, the ‘bailouts’ and measures ostensibly to benefit homeowners is really a cover to benefit industry and corporate interests. Because the ‘Feds’ have stepped in to regulate Freddie Mac and Fannie Mae and ‘run the show’ shouldn’t they be doing something for the people….finally? I’m afraid, like usual, this is just more evidence of the fact that the banking industry owns Washington. I’m remiss that I didn’t see through this charade years ago.
Incidentally, were YOU aware that the “Federal” Reserve is not Federal?? As excerpted from G. Edward Griffin’s book referring to the “Federal” Reserve entitled The Creature From Jekyll Island, he says of the Fed: “It is an association of the large commercial banks which has been granted special privileges by Congress. A more accurate description would be simply that it is a cartel protected by federal law.” It makes more sense now when you hear that the government along with Fannie, Freddie and the Federal Reserve are just helping all the good ‘ole boys on Wall Street and in the banking business…and screwing homeowners.
For Financial Consultation of any kind including prudent real estate acquisition and mortgage financing strategies, Eric Johnson can be reached at 1.888.390.5697 or MoneyNFLA@aol.com
FAQ on Mortgage Loan Modifications
Te purpose of a mortgage loan modification is to simply help the home owner remain in their home with monthly payments that they can afford. Recent government incentives make mortgage loan modification a win/win situation for both the home owner and lender.
by valeria on Mon Apr 27, 2009 8:46 pm
Q. What kind of Borrower qualifies for a mortgage loan modification?
A. Each lender has its own policies, but the general requirement is that you have a job and be able to prove a financial hardship. This tells your lender two things:
1. Falling behind in your monthly payments wasn’t entirely your fault
2. Modifying your loan can really help you back on your feet.
Q. What is a good example of a modifiable loan?
A. Anyone in financial trouble may be helped, but certain conditions can make our job easier. Ideal clients are those who:
- behind in payments or are already in foreclosure
- have received a notice of default
- have an adjustable-rate mortgage that has already increased
- have negative amortization loans
- are experiencing financial hardships due to bad or predatory lending, income reduction or illness or other “hardship”
- steady source of income to pay the modified payment
The “Text Book” file is a mortgage holder that has an adjustable rate mortgage (ARM) and is having trouble making payments after the adjustment or foresees a problem after the adjustment happens. All types of loans can be modified: ARM’s, negative amortizing loans, interest only loans, investment or commercial property.
Q. Can unemployed homeowners be helped?
A. No. You need a source of income to qualify for mortgage loan modification.
Q. Do you count the income of people who are living in the home but are not on the title?
A. Yes. The total income of the household is considered, not just the homeowner’s income.
Q. I need financial help paying the mortgage payments that are behind. What are my options?
A. Many people think they need to pay off their debts before they can try anything else. That’s simply not the case. Mortgage modifications can be very powerful and very flexible. During a modification, it’s possible to eliminate back payments you owe in addition to lowering your monthly bill.
Q. Do I need to be delinquent or behind in my mortgage?
A. No, but it will make things easier. Loan modification is meant to help people in financial hardship, and banks are more willing to help borrowers in trouble and that typically means you are behind in your payments.
Q. I’m already behind on my mortgage payments, is there anything I can do?
A. There are always options. If you’re behind on your mortgage, you may be a perfect candidate for a loan modification. It can help save you money by lowering your mortgage payments and stop foreclosure process that may be threatening your home.
Q. Is it too late to help clients who are in foreclosure?
A. Definitely not! Foreclosure can be prevented up to a few days before the actual transfer sale date. However, if you are thinking of getting help, please don’t wait until you have received a notice of sale. It’s important to take action.
Q. Can you help me stop foreclosure?
A. In most cases, help to starve off foreclosure is achieved by negotiating with your lender or servicer. Remember they do not want to own your home. That is a lose-lose situation. A hold can generally be put on your foreclosure status, but you’ll need to act quickly. The sooner you begin working on this issue, the easier it will be to stop the foreclosure process - even if you’ve been in the foreclosure process for a while.
Call 904-757-0880 for more information and to see if you qualify for mortgage loan modification.
