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Sunday, November 29, 2009

What is the Feds thinking with home loans?

Keeping up with the loan business in today's market is crazy. The rules keep changing, making loans harder to get. A 620 FICO used to be a good credit score, now it's crap. You need a 700+ to get a loan today, in most cases.

Then you have the 90 day rule to resale homes. I guess they want the investor to take all the risk and get little reward. Investors buy up inventory and help the market out. Most owner occupied buyers do not want to deal with the rehabbing. They want homes that have been rehabbed and ready to move in to. Conventional, VA and USDA don't require seasoning.

If you want to refinance or pull cash out of a investment home, you'll need to own it for 6 months. You will need a 680 or up FICO even at a 50%-60% LTV. The loans do take a while, but the interest rates are still very low. That makes investment homes a great deal. When interest rates do spike then your loan and investment property will be worth more. Remember low interest loan and can make your property worth more in some markets.

If you are putting 10% down on a conventional loan you'll need a 700+ FICO not because of the loan but the MI (Mortgage insurance). They are now requiring that. If you get a 80% LTV loan then you'll have no MI on the loan, and that requirement goes away. You can also have a lower FICO score a 80% also.

VA and USDA loans have no seasoning and are easier loans to get. VA loans sometimes have awful appraisers. Make sure and send the lender Comps of the area (sold homes in your properties immediate area) Conventional loans with 10%-20% down have no seasoning also. Just remember on the 10% conventional deal you'll need a higher FICO to qualify for the MI.

Being with the right people can help you have massive profit in this market. The harder it gets the more you can make.

Changing times in real estate is here and you need to be in a group that helps you with these type of problems. Join us and keep up with the changing times and find out how to profit in this market!

Thursday, November 19, 2009

Different types of realtors

Understanding Realtors and what type they are, is as important as buying the right type of real estate. How would you know what type of realtor your working with?

I'm personally a realtor and very good at investment real estate. Why is that because I actually do it. I've personally done 100's of successful homes. I also have a construction company and understand construction. What needs to be done on homes vary for example a lot of investors and Realtors make the mistake of over spending on rehabbing.

The realtor wants the nicest home to sell so spending more makes it easier in most cases. In these type of cases usually the realtor is not in the business and do not do investment real estate themselves. If they did have the knowledge then they would understand what needs to be done and what doesn't. Example Flooring in a $50,000 is going to be different than a $250,000 home. If you put the flooring in that you would a $250,000 home in the $50,000 home you've spent to much money. Easier to sale but the clients pockets don't get filled that way.

The investor that spends to much money on investment properties usually does so because they are making the home like their own. That's were a good realtor that understands investment real estate steps in and explains the type of client that will be buying that home. They will also know what the home needs and doesn't. I usually take my clients to other listings in the area so they can see what needs to be done on that home. You will also get you competition in that area.

The retail market is the samething a good realtor will know the areas and listen to the clients. For example a couple I took out that bought a $600,000 home liked the grandest looking home in the area. The inside was important but not as important as outside. I sent my wife out to show them the first batch of homes. She got back and showed me the narrowed list.

I went through the list and looked at the ones that they didn't want and noticed that the home fit all their perimeters. I told my wife to show them that one and they would buy it. Knowing what your clients like and dislike is a major reason that some realtors are sucessful and some aren't.

By the way the clients have lived in that home for 3 years. Again make sure you pick the right realtor for whatever type of property you want to buy.

Saturday, November 7, 2009

Make sure you have an end game

When you are investing in real estate, understanding the different markets will make you more profitable in the long run.

Our company allows you to buy in three states that vary in their prices and profits. For example; Ohio offers homes vary from $25-$50K remodeled in Michigan $25K Remodeled. Phoenix is a little different there is a vast spread on the prices and areas you can buy. The prices I recommend range from $35,000-$150,000 in Phoenix.

Buying the property at the right price is only the first step. Remodeling right and in budget is the most important issue in investing. I've seen people spend so much money in construction and end up loosing in the end. Understanding construction is the most important thing in investing. My company has done 300 plus flips and undestand that the numbers must be right in this area. A home should take 4-6 weeks to get done.

When doing construction remember there is a difference in a rental remodel and a flip remodel. The rental should save you money. The flip would be more detailed and have more upgrades. Better flooring,paint, lighting etc.

The end game is important also. If your selling it or renting it make sure you have it set up and ready to go. If your selling have the sales price and verify it at least twice. Rents can be varified thru running a fake craigslist ad or a good property mangement company. Again we have all this taken care of for you.

In the end make sure you have you team in place and understand your end game with each property.

Brett young
Valley Realty
Owner/ CEO Roof Top Investment
Real Estate Investment

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