Top 5 Real Estate Financing Options

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Top 5 Real Estate Financing Options

Real estate Financing Options can be pretty tricky and there are tons of options.

If you want to finance a commercial property instead of a residential property they can get even more complicated.  This article will explore 5 ways to get the property you want and the different financing options involved.

Investments in Real Estate financingusually involve large amounts of money which ranges from…

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Home Residential Real Estate Sales 2016

Real Estate Home Sales 2017
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Services 1. Residential

Residential real estate is a type of property, containing either a single family or multifamily structure, that is available for occupation for non-business purposes.
Residences can be classified by, if, and how they are connected to neighbouring residences and land. Different types of housing tenure can be used for the same physical type. For example, connected residents might be owned by a single entity and leased out, or owned separately with an agreement covering the relationship between units and common areas and concerns.
‘Single-family detached house’

Major categories in North America and Europe

Attached / multi-unit dwellings
Apartment (American English) or Flat (British English) – An individual unit in a multi-unit building. The boundaries of the apartment are generally defined by a perimeter of locked or lockable doors. Often seen in multi-story apartment buildings.
Multi-family house – Often seen in multi-story detached buildings, where each floor is a separate apartment or unit.
Terraced house (a. k. a. townhouse or rowhouse) – A number of single or multi-unit buildings in a continuous row with shared walls and no intervening space.
Condominium – Building or complex, similar to apartments, owned by individuals. Common grounds and common areas within the complex are owned and shared jointly. There are townhouse or rowhouse style condominiums as well.
Cooperative (a. k. a. co-op) – A type of multiple ownership in which the residents of a multi-unit housing complex own shares in the cooperative corporation that owns the property, giving each resident the right to occupy a specific apartment or unit.
Semi-detached dwellings
Duplex – Two units with one shared wall.
Single-family detached house
Portable dwellings
Mobile homes – Potentially a full-time residence which can be (might not in practice be) movable on wheels.
Houseboats – A floating home
Tents – Usually very temporary, with roof and walls consisting only of fabric-like material.

The size of an apartment or house can be described in square feet or meters. In the United States, this includes the area of “living space”, excluding the garage and other non-living spaces. The “square meters” figure of a house in Europe may report the total area of the walls enclosing the home, thus including any attached garage and non-living spaces, which makes it important to inquire what kind of surface definition has been used.

It can be described more roughly by the number of rooms. A studio apartment has a single bedroom with no living room (possibly a separate kitchen). A one-bedroom apartment has a living or dining room separate from the bedroom. Two bedroom, three bedroom, and larger units are common. (A bedroom is a separate room intended for sleeping. It commonly contains a bed and, in newer dwelling units, a built-in closet for clothes storage.)

Major categories in India and the Asian Subcontinent
Co-operative Housing Societies (CHS)
Condominiums
Chawls
Villas
Havelis

The size is measured in Gaz (square yards), Quila, Marla, Beegha, and acre.
See List of house types for a complete listing of housing types and layouts, real estate trends for shifts in the market and house or home for more general information.

Services

Our Team Of Real Estate Experts can guide you from start to finish with your real estate transaction whether it be a residential transaction, a commercial transaction, or if you are buying an investment property for rental income. Our team is specialized in each topic and we match you up with the right real estate agent for your particular situation from your home town. Call us today to get started on your journey.

Services 1. Residential

Residential real estate is a type of property, containing either a single family or multifamily structure, that is available for occupation for non-business purposes.
Residences can be classified by, if, and how they are connected to neighbouring residences and land. Different types of housing tenure can be used for the same physical type. For example, connected residents might be owned by a single entity and leased out, or owned separately with an agreement covering the relationship between units and common areas and concerns.

‘Single-family detached house’
Major categories in North America and Europe
Attached / multi-unit dwellings
Apartment (American English) or Flat (British English) – An individual unit in a multi-unit building. The boundaries of the apartment are generally defined by a perimeter of locked or lockable doors. Often seen in multi-story apartment buildings.
Multi-family house – Often seen in multi-story detached buildings, where each floor is a separate apartment or unit.
Terraced house (a. k. a. townhouse or rowhouse) – A number of single or multi-unit buildings in a continuous row with shared walls and no intervening space.
Condominium – Building or complex, similar to apartments, owned by individuals. Common grounds and common areas within the complex are owned and shared jointly. There are townhouse or rowhouse style condominiums as well.
Cooperative (a. k. a. co-op) – A type of multiple ownership in which the residents of a multi-unit housing complex own shares in the cooperative corporation that owns the property, giving each resident the right to occupy a specific apartment or unit.
Semi-detached dwellings
Duplex – Two units with one shared wall.
Single-family detached house
Portable dwellings
Mobile homes – Potentially a full-time residence which can be (might not in practice be) movable on wheels.
Houseboats – A floating home
Tents – Usually very temporary, with roof and walls consisting only of fabric-like material.

The size of an apartment or house can be described in square feet or meters. In the United States, this includes the area of “living space”, excluding the garage and other non-living spaces. The “square meters” figure of a house in Europe may report the total area of the walls enclosing the home, thus including any attached garage and non-living spaces, which makes it important to inquire what kind of surface definition has been used.

It can be described more roughly by the number of rooms. A studio apartment has a single bedroom with no living room (possibly a separate kitchen). A one-bedroom apartment has a living or dining room separate from the bedroom. Two bedroom, three bedroom, and larger units are common. (A bedroom is a separate room intended for sleeping. It commonly contains a bed and, in newer dwelling units, a built-in closet for clothes storage.)

Major categories in India and the Asian Subcontinent
Co-operative Housing Societies (CHS)
Condominiums
Chawls
Villas
Havelis

The size is measured in Gaz (square yards), Quila, Marla, Beegha, and acre.
See List of house types for a complete listing of housing types and layouts, real estate trends for shifts in the market and house or home for more general information.

Services 2 Commercial

Commercial property includes office buildings, industrial property, medical centers, hotels, malls, retail stores, farm land, multifamily housing buildings, warehouses, and garages. In many states, residential property containing more than a certain number of units qualifies as commercial property for borrowing and tax purposes.

Commercial real estate is commonly divided into six categories:
Office Buildings – This category includes single‐tenant properties, small professional office buildings, downtown skyscrapers, and everything in between.
Industrial – This category ranges from smaller properties, often called “Flex” or “R&D” properties, to larger office service or office warehouse properties to the very large “big box” industrial properties. An important, defining characteristic of industrial space is Clear Height. Clear height is the actual height, to the bottom of the steel girders in the interior of the building. This might be 14‐16 feet for smaller properties, and 40+ feet for larger properties. We also consider the type and number of docks that the property has. These can be Grade Level, where the parking lot and the warehouse floor are on the same level, to semi‐dock height at 24 inches, which is the height of a pickup truck or delivery truck, or a full‐dock at 48 inches which is semi‐truck height. Some buildings may even have a Rail Spur for train cars to load and unload.
Retail/Restaurant – This category includes pad sites on highway frontages, single tenant retail buildings, small neighborhood shopping centers, larger centers with grocery store anchor tenants, “power centers” with large anchor stores such as Best Buy, PetSmart, OfficeMax, and so on even regional and outlet malls.
Multifamily – This category includes apartment complexes or high‐rise apartment buildings. Generally, anything larger than a fourplex is considered commercial real estate.
Land – This category includes investment properties on undeveloped, raw, rural land in the path of future development. Or, infill land with an urban area, pad sites, and more.
Miscellaneous – This catch all category would include any other nonresidential properties such as hotel, hospitality, medical, and self‐storage developments, as well as many more.

Services 3. Rental

There is typically an implied, explicit, or written rental agreement or contract involved to specify the terms of the rental, which are regulated and managed under contract law.

Examples include letting out real estate (real property) for the purpose of housing tenure (where the tenant rents a residence to live in), parking space for a vehicle(s), storage space, whole or portions of properties for business, agricultural, institutional, or government use, or other reasons.

When renting real estate, the person(s) or party who lives in or occupies the real estate is often called a tenant, paying rent to the owner of the property, often called a landlord (or landlady). The real estate rented may be all or part of almost any real estate, such as an apartment, house, building, business office(s) or suite, land, farm, or merely an inside or outside space to park a vehicle, or store things all under Real estate law.

The tenancy agreement for real estate is often called a lease, and usually involves specific property rights in real property, as opposed to chattels.
In India, the rental income on property is taxed under the head “income from house property”. A deduction of 30% is allowed from total rent which is charged to tax.

The time use of a chattel or other so called “personal property” is covered under general contract law, but the term lease also nowadays extends to long term rental contracts of more expensive non-Real properties such as automobiles, boats, planes, office equipment and so forth. The distinction in that case is long term versus short term rentals.

 

Some non-real properties commonly available for rent or lease are:

motion pictures on VHS or DVD, of audio CDs, of computer programs on CD-ROM.
transport equipment, such as an automobile or a bicycle.
ships and boats, in which case rental is known as chartering, and the rent is known as hire or freight (depending on the type of charter)
aircraft, in which case rental is known as chartering, or leasing if the rental is longer term
specialized tools, such as a chainsaw, laptop, IT equipment or something more substantial, such as a forklift.
large equipment such as cranes, oil rigs and submarines.
a deckchair or beach chair and umbrella.
furniture
designer handbags, jewelry,[7] sunglasses and watches.
electrical items such as washing machines[7]

In various degrees, renting can involve buying services for various amounts of time, such as staying in a hotel, using a computer in an Internet cafe, or riding in a taxicab (some forms of English use the term “hiring” for this activity).
As seen from the examples, some rented goods are used on the spot, but usually they are taken along; to help guarantee that they are brought back, one or more of the following applies:
one shows an identity document
one signs a contract; any damage already present when renting may be noted down to avoid that the renter is blamed for it when the good is returned
one pays a damage deposit (a refundable fee that may be used in part to pay for damage caused by the renter)

If the customer has a credit account with the rental company, they may rent over several months (or years) and will receive a recurring or continuation invoice each rental period until they return the equipment. In this case deposits are rarely required.

In certain types of rental (sometimes known as operated or wet rental) the charge may be calculated by the rental charge + timesheets of operators or drivers supplied by the rental company to operate the equipment. This is particularly relevant for crane rental companies.

Sometimes the risk that the good is kept is reduced by it being a special model or having signs on it that cannot easily be removed, making it obvious that it is owned by the rental company; this is especially effective for goods used in public places, but even when used at home it may help due to social control.
Persons and businesses that regularly rent goods from a particular company generally have an account with that company, which reduces the administrative procedure (transaction costs) on each occasion.
Signing out books from a library could be considered renting when there is a fee per book. However the term lending is more common.

Our Team Of Real Estate Experts can guide you from start to finish with your real estate transaction.

Whether it be a residential transaction, a commercial transaction, or if you are buying an investment property for rental income.

Our team is specialized in each topic and we match you up with the right real estate agent for your particular situation from your home town.

Call us today to get started on your journey.

Top 5 Real Estate Financing Options

https://goo.gl/kLpHGP

Real estates can be financed in various ways depending on whether you want to finance a commercial property or residential property

Investments in Real Estate financing usually involve large amounts of money which ranges from a few thousand dollars to millions of dollars.

Most investors do not have the financial capacity to out rightly cover most of their real estate investment; hence most properties are purchased with leverage.

In this article, we will narrow our options to financing residential real estate properties.

The best time for buying any real estate property still remains in an upward trending market. However, if you don’t have a good credit rating or enough liquid assets, purchasing real estate in the present market could be a pain in the neck. Therefore, the financing options discussed here are helpful if you don’t have the capital means to get a mortgage on the property.

Employ these methods whether you are looking to purchase your first home, upgrade your present home or just want to venture into the business of purchasing rental properties.

So here are our selected ways to finance an investment in real estate.

a)      THE TRADITIONAL WAY

This option usually involves approaching credit unions, home mortgage companies and banks for financing. You can get a finance options with tenor ranging from 10,15,20,25 year fixed or 30-year fixed. Due to the present housing conditions however, lenders have stiffened their criteria. A credit score of 620 is required by most for approval. Full documentations on debts and income will also be required for processing. If you qualify, you might be asked for a 5-10% down payment.

b)     THE LEASING WAY

This option allows purchasing a real estate property with little or no down payment. It also affords you the right to buy the property as time goes on – usually in 2 or 3 years. This time frame will enable you to seek opportunity to procure financing, and if you want to be smart savvy, you can allocate part of the monthly lease payment for the balance of the home.

c)     THE SELLER CARRY BACK 

This method is also known as owner-provided financing or OWC. They are becoming popular these days as the traditional ways of financing real estate investments are becoming more challenging. In this option, the seller and the buyer, signs a promissory note that mandates the buyer to pay a specified amount of money, with a specified interest rate and at a specified time.

Once the deal is signed, the seller transfers the title of ownership to the buyer and moves out. The monthly payments are made directly to the seller, instead of a bank, as is common with mortgages. If the buyer, at any time, defaults in the monthly payments, the seller can legally take back the property through foreclosure. He can choose to resell the property again.

d)     THE SELLER “SECOND”

This option is sought mostly when banks are refusing to finance your real estate investment for full purchase price of the property. The buyer will usually make a cash down payment, which is the difference between the amount the bank will lend and the real purchase price of the property. If the buyer cannot cover the down payment, the seller may agree to process a second mortgage on the property to cover for the shortfall. It is this second mortgage that is usually referred to as Seller Second.

Interest rates, payments and terms on the seller second are negotiated between the seller and buyer.

HARD MONEY LENDING

This is one of the little understood options for financing your real estate investments.

There are small groups or private individuals, known as Hard Money Lenders. They specialize in lending money, not based on your credit score, but on the property you want to buy. However, the catch is that you will end up paying more interest on the loan than you would for a normal mortgage. There is also an origination fee that needs to be paid.

This option is best if you want to purchase a property and quickly sell for huge profits, and you can’t afford the standard mortgage. Since lending is not based on credit score, you can receive funding within days. Also you can get the loan for any piece of property and you deal with an individual, so no need of going through a rigorous process of filling many undertakings.

Whatever option you decide to try out, ensure all transactions are properly and legally filed. This can be done at the County Clerk’s office where the property is situated.

David J. Moore, MBA – Real Estate Financing Expert

http://www.homeloan.chase.com/david.j.moore

Have you ever met the type of real estate agent who has virtually no online traffic to their site or on basically social media?   We are the type of company who solves that type of problem.  Visit me here if you’d like a free, no-obligation consultation.

http://www.ypn.us




How To Know The Right Real Estate Agent To Work With

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Choosing The Right Real Estate Agent to work with
Choosing The Right Real Estate Agent

In my tenure as a Real Estate Professional, I have been done work with literally thousands of Real Estate Agents. I have come across some good ones as well as I have come across many bad ones.

 

The good ones have you and your family’s best interest as their main focus. The bad ones often have their own wallet as their main focus. The difference between the successful Realtor and the non successful Realtor is what their main priority is when they are working with you.

#1 Sign you have the wrong Realtor

If your Realtor acts stressed because you want to see a different house, or if they are upset because you would like to try and sell different features of your home that you would like pointed out, then cut and run far away from that type of individual.

Those are the type of Realtors that you do NOT want working for you.

Those are the kinds of real estate “professionals” that will take their 3% commission or maybe even 6% commission on your transaction, and you will never hear from them again because they are off to make the next “sale”. These are the types of individuals who have no problem paying their bills off in their own life from the commission given to them off of your transaction, which for most families is the biggest financial transaction in their entire lifetime.

Instead, see if your Realtor actually cares about your situation and understands your needs as a customer. Ask if he or she is willing to work, not only for you, but for your family’s best interest. Actually ask them questions about their own lives even. Look them up on facebook, etc.

See what type of individual they conduct themselves as on a daily basis publicly. If somebody is genuine, you will absolutely be able to tell because a true professional in Real Estate will want to make a customer for life, not just for one transaction.

I admire most of those involved in Real Estate because we are connecting families with a community, neighborhood, job opportunity, friends, family and neighbors. More importantly, we true professionals are connecting a place our customers can call their home.

Each home has a story to tell if you’ve lived in it for a period of time. Choose today to make a difference for the positive, no matter what profession you are in. Help out others and it will be seen, heard and returned to you in the long run.

If your a Real Estate professional, ask yourself this question…… What type of “home” do you want to have your customers say about the way you conduct business?

In the upcoming weeks I will be highlighting those Real Estate Agents who’s customers can say that Realtors made a difference in their lives. If you would like your work to be considered, please inbox me and send me a short story about your experience with your customers. This is not just for experienced Real Estate agent, it is also for the person who new to the business and simply wants to make a difference. I would love to hear your story. 🙂

David J. Moore, MBA – Real Estate Financing expert, CEO of YPN Inc.
[email protected] – sign up here for our free newsletter

#ypn-the future of your career starts today
Knowing the RIGHT real estate agent to work with

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What Does Your Investment Future Look Like ?

First Time Home buyer
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Investments in real estate usually involve large amounts of money which ranges from a few thousand dollars to millions of dollars.

Young Professional Networks Online Real Estate Video Channel

Most investors do not have the financial capacity to out rightly cover most of their real estate investment; hence most properties are purchased with leverage.




Real estates can be financed in various ways depending on whether you want to finance a commercial property or residential property.  In this article, we will narrow our options to financing residential real estate properties.

The best time for buying any real estate property still remains in an up trending market. However, if you don’t have a good credit rating or enough liquid assets, purchasing real estate in the present market could be a pain in the neck.Therefore, the financing options discussed here is helpful if you don’t have a perfect credit rating.

Employ these methods whether you are looking to purchase your first home, upgrade your present home or just want to venture into the business of purchasing rental properties.

So here are our selected ways to finance an investment in real estate.

a) THE TRADITIONAL WAY

This option usually involves approaching credit unions, home mortgage companies and banks for financing. You can get a finance options with tenor ranging from 15 year fixed or 30-year fixed with current rates ranging from 4.0% to 6.25% respectively for the above tenor. Due to the present housing conditions however, lenders have stiffened their criteria. A credit score of 620 is required by most for approval.

Full documentations on debts and income will also be required for processing. If you qualify, you might be asked for a 5-10% down payment…..on a true investment property, 20% down payment is what the bank feels comfortable with since you less apt to walk away from a financial obligation in it with so much equity available.

b) THE LEASING WAY

This option allows purchasing a real estate property with little or no down payment. It also affords you the right to buy the property as time goes on – usually in 2 or 3 years. This time frame will enable you to seek opportunity to procure financing, and if you want to be smart savvy, you can allocate part of the monthly lease payment for the balance of the home.

FYI however, that often times you will not find to many people helping you make the negotiations or contract in this sort of sale, since it is non-traditional and nobody except the title company will make a commission in it.

Real Estate Agents and Mortgage Lenders support themselves off of commissions from helping people purchase their new home, or selling their own home. It’s a standard principle in this industry. So just expect that you might be flying solo if you call somebody out of the blue and ask them to help you on this sort of deal. I didn’t create the rules; I just know them.

c) THE SELLER CARRY BACK WAY

This method is also known as owner-provided financing or OWC. They are becoming popular these days as the traditional ways of financing real estate investments are becoming more challenging. In this option, the seller and the buyer, signs a promissory note that mandates the buyer to pay a specified amount of money, with a specified interest rate and at a specified time.

Once the deal is signed, the seller transfers the title of ownership to the buyer and moves out. The monthly payments are made directly to the seller, instead of a bank, as is common with mortgages. If the buyer, at any time, defaults in the monthly payments, the seller can legally take back the property through foreclosure. He can choose to resell the property again.

d) THE SELLER SECOND WAY

This option is sought mostly when banks are refusing to finance your real estate investment for full purchase price of the property. The buyer will usually make a cash down payment, which is the difference between the amount the bank will lend and the real purchase price of the property. If the buyer cannot cover the down payment, the seller may agree to process a second mortgage on the property to cover for the shortfall. It is this second mortgage that is usually referred to as Seller Second.

Interest rates, payments and terms on the seller second are negotiated between the seller and buyer. I’d like to add that this is EXTREMELY rare if even around anymore. I have not done one of these traditionally in several years. From experience, if there is any arrangement like this happening, it is traditionally done outside the typical scope of a lender and is often what we refer to as a “back door deal”. (it is an agreement between buyer and seller which the lenders and agents don’t normally have any knowledge of 😉

HARD MONEY LENDING

This is one of the little understood options for financing your real estate investments.

There are small groups or private individuals, known as Hard Money Lenders. They specialize in lending money, not based on your credit score, but on the property you want to buy. However, the catch is that you will end up paying more interest on the loan than you would for a normal mortgage. There is also an origination fee that needs to be paid.

This option is best if you want to purchase a property and quickly sell for huge profits, and you can’t afford the standard mortgage. Since lending is not based on credit score, you can receive funding within days. Also you can get the loan for any piece of property and you deal with an individual, so no need of going through a rigorous process of filling many undertakings.

Hard money lending is a fantastic option for a lot of my investors, and even sometimes for those just purchasing their first home. Since the housing market crash, banks underwriting standards have been quite stringent, so this is a very viable way to acquire the property you need with relatively hardly any hassle.

Once a typical customer acquires the property, they generally end up waiting for about 6 months and then finance it in a traditional way with a lower interest rate. Each situation is different, but call us or email us if you want that option. FYI, it typically takes 30% down for this option since the property is the collateral for the investor.

Conclusion

Whatever option you decide to try out, ensure all transactions are properly and legally filed. This can be done at the County Clerk’s office where the property is situated. Make sure you use experienced real estate agents, mortgage lenders, and title company agents since this could possibly be the largest financial transaction of your life and you don’t want to put your trust in something like that into somebody that is going to be learning his/her career mistakes off of your livelihood. J Call us for a free 15-minute consultation if you’d like some objective advice also.

Young Professionals Network are rewarded by the fact that we get to see young professionals grow and excel in their career instead of seeing us grow our wallets fatter. We sell knowledge over products. We are more than just a monetary company, we are a force of millennials who is here for the long haul, not just for a moment.

If you have questions about our company whether you are an investor, potential student, or volunteer (thanks so much for you volunteers) don’t hesitate to reach out to us k. Our members are very special and have EVERYTHING to offer this world with our different way of thinking.

Shoot half of the time you’ll see us hanging out playing video games with other professionals, or even cutting it up in a backyard playing corn hole with our good friends after the work day is over because that’s just how we roll.  We are one big group of misunderstood people who are showing the world how different thinking is not such a scary thing.

As long as we have a good solid core of what we want to do and what direction we want to go, we will continue to pursue what is right and progressive. Trust me when we need to, we are like Star Wars and X-men characters and will transform into what roles we need to be whether it be council, political leader, janitor, or computer programmer, But we are one team regardless. 🙂

Thank you for reading this article and for following our company in order to make all of our Young Professionals Dreams be possible. YPN are Young Professional adults who want to grow in their professional and personal life and who want to help other Young Professionals to achieve their career goals. YPN offers a 6 month, 1 times per week mentoring course so you can help further your job and your future.

Sign up today and get your first course for free! Choose your future today and come be a part of something that is unlike anything else you’ve seen. You’ll be amazed at how inviting our family of Young Professionals are for you. We look forward to meeting you soon!

David J. Moore M.B.A.

CEO YPN Inc.

#YPN The Future of Your Career Is Today!

https://www.1ypn.com

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email: [email protected]

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