Dean Graziosi’s Real Estate Investment Academy

In this poor economy, many people who once dreamed of owning their own home have since given up on that dream. Why? It is mainly because of credit. Lenders have tightened the requirements for granting home loans and many of the people who were once able to qualify no longer meet the requirements. There are several reasons for this. Someone could just be starting out and not have had the chance to develop a credit history or they may be in debt to losing a job. Other people simply refuse to use any type of credit if they can avoid it and by the time they want to buy a house they find that they cannot meet the credit requirements.

Many things require good credit if you want to not only be approved for the financing but also get a low interest rate. Low rates are important so that you do not pay extra money in interest that you could have avoided paying. If you have bad credit or no credit, it can be hard proving to a lender that you are someone who pays on time and that you are serious about purchasing a home. Even if you have a steady job, lenders will be unwilling to loan you the money that you will need for a purchase as large as a home.

Some people advocate that those who are ready to buy a home but have no credit history begin to establish a history. While this may seem like a good solution, it is not for everyone. A lot of people wish to avoid the credit problem altogether and they buy what they want using cash or do not buy it at all. For very large purchases they need to have financing but may still be reluctant to use credit. Others are afraid of identity theft and will actually avoid using credit in an effort to control where their Social Security numbers are. This can cut the risk of identity theft but it limits them to trying to get financing without having any kind of credit to fall back on.

Thanks to the rough economy and many people refusing to leave credit, some lenders are willing to use alternative credit. You may not realize that you are always establishing credit. Around 35% of your credit history is based on whether you make payments on time. With this in mind, some lenders are willing to look at your rent history and how you pay bills such as your water or power bill. They will check how often you pay, whether you have been behind, and whether you have ever had services disconnected. Through this the lender will be able to establish a credit history for you and provide financing.

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While some sellers are selling their home because they have no choice - they may have to move out-of-state for a job or need to downsize - most decide they want to sell their home and that they do not need any help to do it. Not getting the advice of a licensed real estate agent is one of the biggest blunders that any seller can make but it is not the only one. Here are some other common mistakes that home sellers make when they are trying to sell their home.

Not Cleaning

If you are going to be showing your house to potential buyers while you still live there then you are most likely going to find that keeping it clean is a real challenge. Home buyers do not really want to see another person’s belongings in the house when they arrive. Since this is usually the case, sellers have to keep their home spotless. If you tend to avoid dusting and let the dishes pile up in the sink, you will have to make the effort to ensure that this doesn’t happen while buyers are coming by. A professional cleaning crew might be the best bet.

Price Too High

Even if you know there have been foreclosures in your area or that property values have gone down for some reason you will be tempted to set your price as if nothing has happened. This is one area where a real estate agent can be very helpful. An agent can make sure that you are not setting your price too high for what buyers are willing to pay and what is the going rate in your area. Just because you want a certain price for your home does not mean you will get it.

Too Much Clutter

Clutter is possibly a seller’s worst enemy. When your house goes on the market start packing up your belongings. This may seem like an inconvenience but it will actually help you to sell your home. If a buyer visits your home during an open house, they do not want to see a closet overflowing with shoes or a drawer that is so stuffed it won’t close. They will assume that the home does not have enough storage space and move on. By moving at least some of your belongings, buyers will assume that there is more than enough storage and be more interested in the house.

Paying a Lot for Remodeling

It may seem like a great idea to spend a lot of money remodeling the bathroom before you put your home on the market. The truth is that you could be wasting a lot of money. Just because you remodel does not mean that the value of your home will increase. Rather than spending a great deal of money to remodel, look for small repairs or touch ups that you can do. A real estate agent can help you identify what rooms need to be painted or make suggestions such as changing the hardware on the cabinets. These small touches can make a huge difference to a buyer.

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You’ve
been looking at homes for what may seem like an eternity, and now you have
found the home of your dreams only to find out that someone has already placed
a bid.  Don’t give up, you can still own
the home of your dreams if you make a counter-offer and your bid is
chosen.  To make sure that your bid is
chosen over other bidders, below we have listed a few tips that can help you
make the perfect bid and walk away with the house you fell in love with.

When you
submit your bid, it is important to only offer the highest amount you
afford.  This amount is based on your
income and the amount that you have been preapproved for.  Often when there is competition for a house,
buyers tend to get swept up in a bidding war. 
It is important to stick to the amount that you can afford, you don’t
want to have the house of your dreams and then come to realize that you can’t
afford the payments. 

Factor
in the equity of your current home when you are planning your down
payment.  The reality of today’s realty
market is that larger down payments are often required.  The higher the down payment you can offer,
the better your chances of walking away with the house at the end of the day.  It is also important to calculate the amount
of down payment you will require for your price range.  Knowing what is required for a down payment
will help you find out where you stand financially, it can also help you
determine if financially you are ready to buy a home.

In order
to make your offer more attractive to sellers, you real estate agent may
suggest that you waive your right to have an inspection done on the
property.  This can make your offer more
attractive, but you will be buying the house blind.  It is important to always have an inspection
done on any property you are considering purchasing.  An inspection will point out any problems
that you may not have noticed when you looked at the home initially.  Never waive your right to an inspection, no
matter how badly you want the house.

An
important step to purchasing a home is getting prequalified from a lender.  Not only does this insure that you have the
finances to pay off the loan, many sellers prefer to only deal with prospective
buyers who are preapproved.  Being
preapproved will help the sale go faster because there is no need to find
financial backing.  When you submit your
bid on a house you should always include a copy of your preapproval
letter.  This may help sway sellers in
your direction; sellers would rather deal with someone who already has access
to the money rather than wait for someone who doesn’t.

Hopefully
these tips will help you place a bid that will be accepted.  Don’t be discouraged if your bid isn’t
chosen, there may be a better home in your future.

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So you want to build your own home. Financing to do that is called a construction loan. Construction loans are different from traditional mortgage loans in several ways. Before you make the decision to build, learn as much as you can about the subject.
Getting Started
Just as with any home loan, the first step in a construction loan is usually to prequalify. Prequalification is a fairly basic process, including straightforward information such as your credit scores and your income.
Qualifying for the Loan
After you prequalify, you can get down to the business of qualifying for the loan. The actual qualification is more intense. You will have to convince the lender that you are indeed creditworthy and able to satisfy the terms of the loan.
You will have to give detailed information about your work history, whether you have worked for someone else or are self-employed. The lender will also want to know the state of your finances, especially how much money you have in savings or other assets.
There is also the matter of a down payment. It is routine for mortgage lenders to require a higher down payment for construction loans than for homes that have already been built. This makes sense when you look at it from their perspective. Before the house is built, the property offers little security against default. If you did not pay, they would want to at least have enough money to cover what they have invested.
Choosing a Closing Type
A construction loan normally has two parts. There is temporary financing that supports the building of the home. Then, there is the permanent financing that is in place after the home is built. This pattern holds true for most of the loans.
The choice you have to make is whether to go with a single closing loan or a double closing loan. In a single closing loan, the temporary financing is put into place with provisions in the contract for it to convert to permanent financing after the house is built. The double closing loan is a little different. It is really two separate loans, one for the building phase and a separate one that is negotiated after the house is built.
Getting Draws
The construction loan is paid out a little at a time. Once again, the mortgage lender is covering his vulnerability during the time before the house is completed. The lender will give a draw to begin the building. After a set period of time, there might be inspections and reports back to the lender so they can decide if it is time to give the next draw. The final draw should coincide with the final building phase of the construction.
Many people are afraid to build a home because they are unfamiliar with construction loans. There is no need to worry if you dream of building. The details of financing the building of a home are not too difficult to learn. Soon you will be breaking ground and beginning to build.

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If you are looking to rent property you already own, or purchase property to rent out to tenants, you will want to make it as profitable as possible. This will influence those who view it to make the decision to rent, and will make you money in the process.

There is a lot of work that goes into preparing a property for rent. Owning any type of property is tough, and there is always competition. You can avoid making many of the mistakes made by first-time investors by ensuring your rental property possesses the following ten features.

Consider the neighborhoods. The quality of the neighborhood you choose will influence both the types of tenants you attract and how often your property is vacant. For example, if you purchase a property near a university, your renters will most likely be students. This will mean vacancies will most likely occur on a regular basis. Consider the types of tenants you wish to attract and choose the neighborhood accordingly.

Property taxes are another important consideration you will face when purchasing property. They aren’t standard across the board. Since you want to actually make a profit off the rent you charge, you need to know just how much you will be paying n taxes. This will give you an idea of the amount of profit you will make over time.

Schools are another consideration. If you choose to rent near schools, it may be advantageous to choose a property large enough to accommodate a family. Since such areas often contain more than one school, planning for a family of at least two children may be your best bet. The quality of the schools can always affect your investment. If a nearby school has a bad reputation, prices will poorly reflect the value of your property.

Crime is another factor that should definitely be considered. A high crime neighborhood will mostly likely mean trouble. You may find there will be a higher turn over where tenants are concerned, and will probably have difficulty finding renters.

Jobs should be another consideration. Locations with many opportunities for employment tend to attract more people. This is especially true of areas that are rapidly growing.

Amenities may also play an important role in whether or not your property attracts renters. These can include: parks, gyms, movie theaters, malls, public transportation, and swimming pools.

Building permits and future development should also receive some thought. Many people tend to migrate toward an area that is thriving. The possibility of new development could serve you well far into the future.

The amount of listings and vacancies if a factor that could directly affect whether or not people will rent in your area. If a particular neighborhood always has vacancies, there is most likely a reason. Properties that have not received much rental turn over will also indicate tenants are happy and wish to remain in that particular place.

Rental amounts are also important. You will need to make sure you are charging market rent for your specific area. Failing to do so could cause some prospective tenants to look past your property for fear it is not up to standard.

Natural disasters can also play an important role in whether or not people choose to rent in a particular area. For example, if the property is on a fault line, chances are prospective tenants will be reluctant to rent because of the potential dangers. Also, the extra insurance you will need to carry on such a property can make a significant dent in the actual profit you receive.

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Many people look to real estate investing as a means to earn a second income. That is certainly logical. Unemployment rates continue to skyrocket. A steady job is not promised. It makes sense that people would want to have an additional source of income in case they lose their jobs. However real estate investing can have its pitfalls. The rest of this article will give you some tips about how you can have success with real estate investing.

New real estate investors should always look for bad houses that need a lot of work or ugly houses. These properties are usually less expensive to purchase even though they typically need some work to improve. Start out by looking for properties with small repairs such as painting, clean up and maybe new carpet. It is not a good idea to tackle the most complicated project you can find as your first project. Build your way up to the really run down properties so you will know what to expect. Also this will give you time to build up your cash reserves so you don’t run out of money before you finish renovating the property.

You can save a lot of money if you think of yourself as a handyman. If you can handle the repairs yourself, you can save a lot of money. However, if you do feel the need to hire someone, be sure to do your due diligence. Be sure that they individual or firm you hire is qualified to do the work you need done. If doing repairs is not your expertise, ask around about a subcontractor that will do the work for a reasonable price. Be sure to ask for references and to see properties the contractor has worked on in the past. Be sure you get an estimate from a dependable contractor in writing before you buy the property. You will learn a lot more about rehabbing houses when you stay in the business longer. It is a good idea to hire a contractor when you are first starting out. You can make an offer on the property once you have all of your estimates together. Once you have your renovation team together and have successfully resold several homes you will feel much more confident about buying properties that need repairs. With a little practice you will be buying properties that the average investor would not even touch. This can be a tremendous advantage when you are looking for properties to invest in because you will face less competition as your rivals will not want to work as hard to renovate a property. You will be able to get a lower price because you can use the fact that there are extensive repairs needed to your advantage. Remember to take things slow when you first start your real estate investing career. Profits will not come overnight. It will take you a while to learn the ropes. After you have been investing for a few years and have several properties under your belt, you will be able to handle anything. Once you get to this point you will be well on your way to a profitable career in a field that is exciting.

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Since the decline of the housing market, real estate agents have had to find new ways
in which to attract prospective clients. This includes taking on tasks that they normally wouldn’t be involved in. Real estate agents are finding it necessary to add to their existing list of skills in order to help clients find a new home or help a seller get the most out of their home in this unstable market.

One of the areas where some real estate agents have had to gain experience in is home staging. In order to make the first impression a prospective buyer gets from a sellers house, realtors have begun to understand the importance of home staging and have started including it as
part of their listing package. Home staging involves realtors making suggestions on how to optimize the space and make it more appealing to prospective buyers. It can also include bringing in furniture and accessories to help make the space look better and offer an impression of what can be done with the property. Having a home staged also makes it more appealing to buyers who prefer to view properties online before visiting in person.

Offering a property value analysis is also something that many realtors are beginning to
offer on a regular basis. This involves the real estate agent to conduct an in depth analysis of the property’s value based on recent sales in the area. The information gathered in a property value analysis will help determine the price at which your home should sell. Realtors are also offering this service to anyone who has a question about the value of their property, they see it as a way to build contacts and possibly gain customers in the long run. Having a property value analysis done is crucial in determining the true value of your home and the realistic price at which it may sell.

If you are unsure about the area surrounding your new home, you may want to ask your realtor for a neighborhood analysis. Many realtors are offering these to clients who may have concerns or questions about the quality of the neighborhood. A neighborhood analysis is an in depth analysis of the neighborhood that a buyer is thinking of moving into. This will give buyers an idea of the quality of the schools in the area and what shopping and businesses are located nearby. A neighborhood analysis is a tool that every prospective buyer should take
advantage of.

Real estate agents have a lot more to offer their clients now than they did in the past. Agents have noticed that by offering additional services than simply showing homes, their clients are much happier and they gain repeat clients. The unstable market has forced many agents to adapt their skills and their clients are benefiting from it.

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Once you

should look for:

• You will want to make sure that your inspector performs

  a thorough inspection of the heating system in the home.  One of the most common problems

  inspectors find when looking at furnaces is a cracked heater

  exchange.  This can be a dangerous

  and expensive problem if it is not found prior to closing. 

• Another thing you will want to look for is any

  sign of moisture in the basement. 

  Finding moisture in the basement can be a sign of previous water

  damage or an ongoing problem that become worse over time.  Moisture in the basement can also lead

  to mold growing behind the walls, if moisture is found you should find out

  when it occurred and if it is something that happens regularly.

• Problems with roofing is another common

  problems found by inspectors.  On

  inspection your inspector should look for any prior hail damage and make

  sure that all flues have been properly maintained.  If your inspector finds any trouble with

  the roof, you may want to ask the seller to report it to their insurance

  company for repair or replacement. 

  Having this done will help you avoid putting a new roof in a few

  months after you move in.

• The electrical system should never be

  overlooked.  If you are purchasing

  an older home your inspector should make sure that the older wiring can

  handle the demands of newer electronics. 

  You wouldn’t want to turn on your air conditioner and have power go

  out.  Problematic wiring can be

  quite dangerous if it is not replaced or upgraded.

• If the house has an air conditioning system

  installed it should be inspected for any problems with the

  air-conditioning compressor.  This

  is a common problem that many inspectors have reported finding and can

  cost over a thousand dollars to repair. 

These

problem areas and insure that they are in proper working condition.

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Now that you‘ve decided to put your home on the market,
you’re probably wondering how you can make it more appealing to prospective
buyers.  Because you’ve lived in your
house for so long, you are probably more familiar with what needs to done than
anyone else.  But there are certain steps
that you can take to insure that your house has a priority spot on many
realtors must see lists.

Since the outside of your house is the first thing that
buyers see as they pull up, there are some things that you should do to make it
as appealing as it can be.

• Paint – Having a fresh
  coat of paint on your house will help it stand out and be noticed.  Prospective buyers who see peeling paint
  may not be as interested as they would be if the paint was fresh and
  clean.  Buyers who see peeling paint
  just one more thing that needs to be done if they purchase your home.




• Shrubs – Without meaning
  to, you may have let your shrubs get a little bit out of control.  Pruning and trimming them so that they
  look pretty and neat will help increase interest in your home.  Nobody wants to have to dodge wayward
  branches just to reach the front door.




• Flowers – If the time of
  year is right, planting flowers will help give your home a friendly and inviting
  look.  Flowers make everything look
  cheerful and happy, if you have flower beds it is important that you keep
  them weeded and watered. 




• Clutter – Removing and
  storing any clutter that may be floating around your yard will give a
  cleaner and neater look to your yard. 
  If your kids have an excess of outside toys, you may want to store
  some in the garage or shed so that your yard doesn’t look smaller than it
  actually is.




• Cleanliness – Once a buyer
  enters your home, they should not have to step over things or feel
  uncomfortable while walking through your home.  When you have prospective buyers
  visiting your home on a regular basis, it is important that you keep it
  tidy and clean.  This will leave a
  better impression with buyers.




• Shampoo Carpets – When trying
  to sell your home, you should consider shampooing all of the carpeted
  areas.  This will give your home a
  fresh and clean look that will also impress buyers.




• Remove What Isn’t Included
  In The Sale – If you have bookshelves or lighting fixtures that you aren’t
  planning on leaving when the house is sold, you should remove them and
  replace them with fixtures that will be left.  This will help buyers from thinking
  something is included when in reality it isn’t.




• Lighting – Before opening
  your home up to buyers, go around each room and inspect that all the
  lights and switches are working. 
  Many buyers want to be able to see what they are buying, dark rooms
  may seem like you’re trying to hide something.

These are only a few tips to help make your home more appealing.  Following some or all will insure that your
home is pleasing to visit and look at.

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