|Real Estate Information|
Real Estate Investing with Bad Credit!
By being creative, you can play the game of real estate investing by using what is called Option's investing.
This is just one technique of the Option's strategy of investing but can be a power tool in your investors toolbox to help you control more real estate and build wealth.
An option is an agreement to you from the seller that gives you the exclusive right to buy a property during a specified time and at a predetermined price but does not obligate you to make the purchase - This is why it's called the Option agreement.
You option to buy - You option not to buy.
Option investing works when you want to control more real estate with limited out of pocket cash or credit and works if you:
Have no credit!
I call this the "SWEAT OPTION".
The sweat option works well if you have the ability to do the repairs yourself.
Your key's in making a deal like this are:
You need to know the basics of real estate investing
Most importantly you need to know how to find sellers that are motivated enough to work with you on this strategy of investing.
I recommend that you farm out your market area looking for properties that are what we call in the industry FSBO's (For Sale by Owner).
Go to your local library and start your research by looking at old newspapers starting with newspapers that are 90 days old and work your way through the FSBO's section making a list of possible deals. Working on a list of 30 or so.
Call and see if the property is still on the market, if so make an appointment to see the property! You will find that none owner occupied properties work the best and you are looking for properties that can not compete well with other homes do to repairs that need to be done.
Let's say the seller has a property that is worth $100,000 after the repairs.
I like using a 5% rule for repairs - If the value of the property is $100,000 after repairs, I do not want to spend more than $5,000 or 5% in repairs.
I would negotiate say an option purchase price of $80,000 for a period of 6 months or more and in the option agreement to perform the repairs at my cost to be my consideration for the option of purchase or should I say the $5,000 in repairs, materials cost and labor to be considered as credit towards the purchase of the property (My down payment) and what ever monthly payment we agree to and credit amount of that monthly payment. So let's say we agree to pay $600 a month with $100 a month credit towards the purchase.
You start you're repairs and complete them in 30 days or less and let's say you purchased $1,500 in materials.
Now you place the property on the market because you have the option to purchase "You have taken control of the property with your option".
Let's say this deal has taken you 90 days from the beginning to the end.
You find your buyer let's say at a great deal of $95,000 - $5,000 below market value at this point you would simply exercise your right to the purchase option and do a simultaneous close.
Now let's run the numbers
Your option purchase was $80,000
Leaving you a gross profit of $20,300
You had out of pocket material cost of $1,500
Carrying cost of $600, (Real estate taxes $300 &$300 Utilities)
Your net profit $15,100
You simply took control of a $100,000 property for $3,900 (payments, materials, utilities, and advertising) and turned a profit of $15,100 in 90 days!
Look at it this way you can make it a cash purchase at $80,000 and take control of one property or be a little creative and take control of the same property for less than $4,000. Both conservative and creative deals work in the world of real estate investing.
Good luck and I hope this will help some of you!
Copyright 2005 JMichael Investments
You have permission to publish this article electronically or in print, free of charge, as long as the bylines are included. A courtesy copy of your publication would be appreciated - send to John@jmichaelrei.com
"Join me in the Bahamas or Marietta Georgia"John Michael - Investor/REI Teacher
Join me on a Bahamas Cruise: http://www.realesmartplanner.com
Join me in Marietta Georgia: http://jmichaelrei.com/html/rei_seminars.html
My site: http://www.jmichaelrei.com/
Real estate company faces $71,000 ethics fine Los Angeles Times
Local News, Real estate prices going up, up, up Coeur d'Alene Press
Oct. 19 Real Estate Transactions The Newark Advocate
Admissions scandal: Real estate developer gets 1 month in prison Los Angeles Times
Inside the Katy Perry Convent That Sparked a Real Estate War Hollywood Reporter
Real Estate Briefs | Real Estate Charleston Post Courier
Well-connected real estate lawyer sells Lincoln Park home Crain's Chicago Business
3 reasons to invest in real estate, according to a financial planner who owns 10 rental properties - Business Insider
3 reasons to invest in real estate, according to a financial planner who owns 10 rental properties Business Insider
10-19-19 - Real Estate Radio Hour Talk Radio 1210 WPHT
WeWork woes pose ominous risk for NYC real estate Fox Business
Real Estate, Homebuilders Continue To Roll Seeking Alpha
Real estate mogul Barry Sternlicht: WeWork went 'off the rails' but it's still a 'real company' - CNBC
Real estate mogul Barry Sternlicht: WeWork went 'off the rails' but it's still a 'real company' CNBC
What is wellness real estate? Curbed Atlanta
Dodge County real estate transfers Fremont Tribune
A fourth Republican woman has announced her candidacy for Congressional District 3 - Farmington Daily Times
A fourth Republican woman has announced her candidacy for Congressional District 3 Farmington Daily Times
Report: Trump tweaked real estate figures to get smaller tax bill The Mercury News
New homes are on the rise in Bakersfield real estate market The Bakersfield Californian
Recent Commercial Real Estate Transactions The New York Times
PHOTOS: Biggest off-season Palm Beach real estate deals, including $105M record-setter - Palm Beach Post
PHOTOS: Biggest off-season Palm Beach real estate deals, including $105M record-setter Palm Beach Post
CBJ hosts Heavy Hitters Commercial Real Estate Awards event Charlotte Business Journal
Boston Retirement hunting for real estate debt manager Pensions & Investments
Real estate notes from The Oklahoman for Oct. 19, 2019 Oklahoman.com
Routt County real estate sales total $7.4M for Oct. 11 to 17, 2019 Steamboat Pilot & Today
Guide to Expert Testimony in Malpractice Cases Against Real Estate Professionals | New Jersey Law Journal - Law.com
Guide to Expert Testimony in Malpractice Cases Against Real Estate Professionals | New Jersey Law Journal Law.com
Can I Sell My Apartment While My Building Is Being Repaired? The New York Times
Real estate deal closes for Hotel Pawnee, clearing the way for restoration North Platte Telegraph
Local Real Estate Sales Slow Slightly Traverse City Ticker
Real estate fraudster Rick Koerber gets 14 years in prison during raucous hearing on his Ponzi scheme - Salt Lake Tribune
Real estate fraudster Rick Koerber gets 14 years in prison during raucous hearing on his Ponzi scheme Salt Lake Tribune
Benefits of Real Estate Chatbots BBN Times
Texas Health Resources adds space and other top D-FW commercial real estate transactions this week - The Dallas Morning News
Texas Health Resources adds space and other top D-FW commercial real estate transactions this week The Dallas Morning News
Four Davenport properties sold in real estate deal Quad City Times
Southeast Michigan real estate broker company suspended WDIV ClickOnDetroit
Sponsored: Real Estate Confidential: Go play in the basement Martha's Vineyard Times
Real Estate Transactions: Oct. 19, 2019 Fairfield Daily Republic
When the Dream of Owning a Home Became a Nightmare The New York Times
Streamlining real estate Greater Wilmington Business Journal
A closer look at Elon Musk's real-estate portfolio: photos Business Insider
State board revokes license of felon Tampa Bay real estate agent Tampa Bay Times
Monmouth Real Estate Will Make Its 21st Consecutive Annual Investor Presentation To The Philadelphia Securities Association - PRNewswire
Monmouth Real Estate Will Make Its 21st Consecutive Annual Investor Presentation To The Philadelphia Securities Association PRNewswire
Berkshire region real estate sales Sept. 29 – Oct. 5, 2019 | theberkshireedge.com
Commercial real estate firm moves to new office space Greater Wilmington Business Journal
Real Estate Fresh Finds: October 16 PoPville
All Things Real Estate: It’s best to have written agreement, even with family members - Fairfield Daily Republic
All Things Real Estate: It’s best to have written agreement, even with family members Fairfield Daily Republic
Real Estate Insider: Why scaffolding appeared at Washington Boulevard building downtown - Crain's Detroit Business
Real Estate Insider: Why scaffolding appeared at Washington Boulevard building downtown Crain's Detroit Business
An Introduction to Real Estate Crowdfunding The Motley Fool
Ultra-luxury advisers at Bespoke Real Estate gear up for new Manhattan office - New York Business Journal
Ultra-luxury advisers at Bespoke Real Estate gear up for new Manhattan office New York Business Journal
Bellevue real estate market transitions into fall Bellevue Reporter
How Greed Derailed a Billion-Dollar Real Estate Deal for The Mountain Hollywood Reporter
Real estate scandal rocks the Vatican The Real Deal
Nearly a fifth of all homes sold in South Florida are bought by investors, study says - Miami Herald
OFF THE CUFF: From real estate magnate to nation-builder Muskogee Daily Phoenix
Salem Real Estate acquires RE/MAX franchise in Siouxland Sioux City Journal
Sweeping LLC law surprised even legislators The Real Deal
The Housing Scene: In real estate listings, words matter Hartford Courant
Real estate transfers Toledo Blade
The Pipeline: Commercial real estate for 10.18.19 RichmondBizSense
Subdividing - But NOT Land!
Many people are familiar with the concept of sub-dividing a large piece of property into smaller lots. The same concept can be very profitable in other areas.
The Real Estate Agent Alphabet
Alphabet Letters after a person's name seem to bestow some kind of special prestige. PHD, MD, ESQ are common.
What Are the Pitfalls of Marketing a Property Before Its Ready?
Selling quickly is a high priority for some home sellers. A job transfer can prompt the need to relocate on short notice.
Maintaining Small Town Charm In An Ever-Changing World
Virtually any state in the country has the appeal of multiple small towns. Ask almost anyone who lives in small town why they are here and they'll tell you they enjoy the small town feeling while being close to all the conveniences of a larger city.
How Do I Implement The Lease Purchase Plan?
Well, as we have discussed in previous newsletters first you have to set up goals for yourself, both long term and short term. Don't forget these goals define how your business is run.
Selling Your Home? A Warning About Attachments
Before you list you home for sale, determine what you don't want to leave behind.Our friends sold their home for full price and moved out a few days before closing.
First Impressions Will Sell Property Fast!
First impressions count, buyers will have already formed an impression before they step into your property. A well-kept garden, pathway and fence, plus a freshly painted front door are immediately appealing, whereas a scruffy outdoor space with a litter bin outside the front door may turn many prospective buyers away.
So, You Wanna Buy Pre-Foreclosures?
So you wanna buy pre-foreclosures? or at the courthouse steps? So many people ask us about this. Here's our '30 second seminar' on it.
Real Estate Investing Is A Better Gamble Than The Lottery
Real estate investing begins when you move to the starting point.Get ready.
How To Realistically Get Started As A Real Estate Investor
When it comes to real estate investing, most beginners find themselves with plenty of desire, a little bit of knowledge (from books, seminars, online message boards or something like that) and in most cases they have little or no money to get started with. Does this sound like you? If so you are not alone.
RESPA: The Real Estate Settlement Procedures Act
The Real Estate Settlement Procedures Act (RESPA) is a consumer protection statute, first passed in 1974. One of its purposes is to help consumers become better shoppers for settlement services.
Renting Versus Buying A Home
Renters are often in a quandary as to whether it makes sense to continue renting or buy a home. Buying a home makes more sense, particularly when taking a long-term view.
Buying a Home: The 5 Biggest Mistakes that a Home Buyer Makes
As a Professional Real Estate Inspector I get to see and hear the right and wrong things people do when buying a home. These 5 tips will help you choose the right Real Estate Agent the first time.
How To Negotiate A Higher Price For Your House
Negotiation is where many FSBO home sellers really have problems. The wrong attitude or a slip of the tongue could cost you thousands.
Homebuyer Heaven Can't Possibly Last
With interest rates at record lows over the past year, there's really only one way for them to go, the only question is when. Most experts agree that rates will remain fairly stable in the short term, at least until the end of the year, and some believe they will even decrease slightly.
Expenses of Home Ownership
Hopefully all goes smoothly when you purchase your home. In your anxiousness to become an owner it may not have crossed your mind and no one tells you, your'e not done spending money on this transaction.
How You Will NOT Make Money in Real Estate
We all have seen some book called "How I Turned my last dollar into $1 Million by buying real estate in my spare time". Some of us even bought such books on an impulse with high expectations.
The 21st Century Way To Build Equity
Here to stay and firmly established in the U.S.
Negotiating A Short Sale - The High Road to Huge Foreclosure Profits
Buying foreclosures can be extremely profitable for real estate investors. However, most of these homeowners are mortgaged to the hilt.
10 Things You Shouldnt Do When Youre Buying a Home
Home Buying Don'tsYour home buying process is well underway. The sellers accepted your offer to purchase.
|home | site map|
|© 2006 TIGER MEDIA|