WHY USE PRIVATE MONEY LENDERS?

 

WHY USE PRIVATE MONEY LENDERS?

1. Private lenders for real estate are offering competitive interest rates

Since a loan on an investment property is secured by a recorded Deed of Trust, private lenders can offer interest rates that are competitive with the open market.

Additionally, since private lenders for real estate are looking for investment properties, they are more likely to offer these rates on properties without a current cash flow than traditional banks, which are still restricting lending.

2. Private Money loans are faster and more flexible than other loans options

Since private lenders use the same investing principles as you do, they can make a quick decision, allowing you to avoid the long process of traditional bank underwriting.

3. Private lenders’ debt service coverage ratio is less strict

Since private lenders do not have the same underwriting process as traditional loan servicing arrangements, they have more flexibility to look at other factors influencing loan repayment.

4. Offer shorter terms

Working with private money lenders offer shorter terms to allow you to secure the property, avoid prepayment penalties, and look to traditional financing once the property is stabilized if necessary.

5. Real estate provides you better access to loans

While keeping traditional loan benefits. With private loans, you still have the same protections as with traditional bank loans, but are able to take advantage of a hard money loan process that moves more quickly and is inherently more flexible than conventional permanent financing.

6. It is less frequent for private loans to be packaged and resold

For real estate, they look specifically at you and your property to make an investment decision, and once they have found a good risk they are unlikely to sell their investment. This allows you a measure of confidence which you will still be doing business with the same partners for the life of a loan.

Even though cash buyers are a great resource for funding and buying real estate, Private Lenders are able to provide investment resources above and beyond what a typical cash buyers may be able to provide.




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Cash Buyer Real Estate Investing

Real estate investing has become a very popular entrepreneurial vehicle over the last 50 years or so. When you think about real estate investing, the first thing which probably comes to mind is your home. Of course, real estate investors have lots of other options when it comes to choosing investments.

Here's a look at some of the leading options for real estate cash buying investors.

Find a Real Estate Cash Buyer who invests in Apartments, Condominiums, and Town-homes
Find a Real Estate Cash Buyer who invests in Manufactured, Mobile, and Modular Homes
Find a Real Estate Cash Buyer who invests in Multi-unit real estate
Find a Real Estate Cash Buyer who invests in Raw land
Find a Real Estate Cash Buyer who invests in Single-family home properties.

Find real estate cash buyers for you all of your real estate investments with CashBuyersLists.com

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Obtaining Financial Freedom Through Real Estate

Obtaining Financial Freedom Through Real Estate

RECBL - Real Estate News

Linda McKissack and her husband were $600,000 in debt when they made a real estate decision that turned their lives around. Today, their real estate business sells over $60 million and over 300 properties each year. McKissack says their biggest success is not their property sales; it’s how they learned to generate over $250,000 a year in passive income and achieve financial freedom through real estate.

Linda McKissack is an entrepreneur, REALTOR(R), and the author of "HOLD: How to Find, Buy and Rent Houses for Wealth." She’s also a trainer and speaker whose greatest passion is helping others achieve their maximum potential. She’s created five successful businesses and is an owner/investor in numerous residential and commercial properties.

Her message to agents everywhere: "You don’t have to live paycheck to paycheck. Learn how to obtain financial freedom through real estate."

Using lessons from her book, McKissack explains how to start investing and earning money even when you have no money.

"If you don’t design your life, something or someone else will," McKissack said. "Keep this question in front of you: What would happen if today the financial resources of your business totally disappeared? It happened to us; it happened to people in Houston, in Florida, in Puerto Rico with the hurricanes. What are you going to do when it happens to you?"

Drowning in Debt
"I was 23 years old and I didn’t know what the word economy meant," McKissack said. "In the 80s the economy was built around savings and loans, oil and gas and real estate, and it all crashed."

McKissacks husband shut down his Dallas nightclub, and four years later they were $600,000 in debt. He asked for her help digging out of debt, and said his mentor once told him the way to make a lot of money fast was in real estate.

"Im sure he meant invest in real estate, buy real estate," McKissack said, "not put your wife to work selling real estate, but sell is what I did." McKissack took a job in real estate sales, and Jim went to work in her office. They restructured their debt with a simple goal: getting back into the black.

It was a good decision, but it took time to see the wisdom in it. "I made $3,000 that first year, but it cost me $15,000 to $17,000 to make that first $3,000. Fast forward to today and our team closes over 200 transactions a year and $60 million in volume. Today we run as a standalone business."

McKissacks first real estate investment came in 1991. They had no cash, a lot of debt to pay off and weak credit, and the only real estate they owned was the house they lived in, which had a big mortgage.

"We found a property the seller wanted to sell fast, without listing it. They asked if we knew of an investor who would purchase the home. We knew it was a good deal, even though the house needed repairs. We formed a partnership with our builder who put up money and got a loan. We located the property and put our commission into the deal. He did the repairs. We flipped the property for $15,000 profit and we were off to success."

What investing taught McKissack was how to beat the REALTOR(R) dilemma. "The REALTOR(R) dilemma is, the day you sell your last house is the day you make your last dollar. I used to think if I just sold 50 more houses, those 50 houses would solve all my problems. We keep thinking 50 or 100 or 200 houses are going to solve all our cash problems, but its not. Cash flow is not the answer. If you follow the statistics, if we don’t do anything different; most of us will die broke or dependent on the government, family, or friends."

Not wanting to rely on others for their financial security is what started the couple down the road to financial freedom with HOLD.

Creating Financial Freedom With HOLD
"HOLD is a long-term real estate investment strategy to which every real estate investor should aspire," said McKissack. "Be an investor, not a speculator. We bought our first property while we were still $600,000 in debt. We now own over 100 single family properties. There are a lot of people who have money they want to invest, but they don’t have the expertise to do it."

Going 50/50 is a definite option, especially using the HOLD strategy. The HOLD strategy is simple:

1. Find the right property for the right terms and at the right price.
2. Analyze - Make sure you have an offer in which the numbers and terms make sense. Do your due diligence on market values, rents, home prices and appreciations to limit your risks.
3. Buy an investment property where you make money going in. If your numbers are right, you'll make money on the margin and get a positive cash flow from the start. Don't buy a property hoping it will become a good deal. Buy it because it’s a good deal to begin with.
4. Manage a property until its paid for or you have a large amount of equity to leverage. Learn to run your investment properties like a business.
5. Grow your way to wealth and financial freedom. If one investment can bring you $2,000 a month, imagine the income from 10, 20 or 100 properties.

If you’re actually flipping houses (buy and sell), you’re just creating more cash flow. What you need is an investment. Our HOLD formula for wealth-building:

• Buy property at 10 percent or more below market value.
• Put at least a 20 percent or more down payment on the property.
• Be at a 70 percent loan-to-value ratio or less so you’re not over-leveraged.
• Cash flow should be a minimum of $200 per month after PITI and management on a 15-year amortization.
• Buy a newer home (15 years or newer) if possible.
• Buy a 3-4-bedroom brick or stucco (if possible).
• Buy homes in stable or appreciating neighborhoods.

7 Rules of HOLD Real Estate Investing

• Be an investor, not a speculator.
• Cash flow is king.
• It isn’t personal, and the numbers matter most. Don’t get attached to the house or people.
• Learn the magic of leverage.
• Cultivate relationships with other investors and people involved in real estate investing.
• Keep learning from others.
• Give to others and share your information, wealth, and knowledge.

By purchasing 20 single family rental properties that each generated $1,000 cash flow per month, and completing those purchases in five years, with each property financed on a 15-year note with at least 20 percent down payment, the McKissacks were able to keep investing in additional properties.

The HOLD strategy isn’t a get-rich-quick scheme, but a long, slow process which involves learning how to build and sustain a strong team and how to run your real estate career as a business, not a job. These and more tips and information on building passive income are in a recent webinar featuring McKissack. Learn more about the team-building cycle, including how to hire great people who can take you greater financial and business success, by listening to the entire webinar.

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Economic Forecast Perks Up

Economic Forecast Perks Up

RECBL - Real Estate News

Analysts are amending their economic forecast due to higher GDP expectations, even as Hurricanes Harvey and Irma weigh on growth, according to Fannie Mae’s Economic & Strategic Research (ESR) Groups recently released Economic and Housing Outlook for September 2017.

The Outlook projects the economy will perk up 2.2 percent over the course of the year, up from the 2.0 percent initially reported.

"For the first time in 2017, we have increased our full-year growth outlook," says Doug Duncan, chief economist at Fannie Mae. "The upgrade reflects economic activity gaining momentum at the end of the second quarter, though we see a great deal of uncertainty surrounding the forecast. The list of uncertainties now extends beyond the geopolitical and legislative, as the effects of Hurricanes Harvey and Irma will require time to untangle.

"Historically, natural disasters that hit heavily populated areas led to substantial near-term declines in economic activity but meaningful rebounds in subsequent quarters due to rebuilding efforts," Duncan says. "Thus, economic growth in the second half of 2017 could still average a slightly stronger pace than the first half. Unfortunately, we continue to expect home sales to be flat during the second half of the year compared to the first half due to strong home price appreciation and lean inventories."

Source: Fannie Mae

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