Smartest Ways to Invest in Real Estate and Earn Great Money

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We are all tired and daunted with ever so new government policies coming out just every quarterly. If you are looking to save your money from taxes, then investments are the smartest tools to not only save but also get good returns. Real Estate offers the best returns by far, better than any stocks or interest rates or funds. Inflation is just everywhere and people shade a lot of hard earned money into paying for taxes to the government. Buying an investment property is the sure shot way of investing money wisely.

Everyone is toiling hard to get good returns for the money they earn, government is not going to help you save money nor give you good returns. But, there are undoubtedly some very good policies laid by government that helps one to save money only if they are ready to save money. Investments gives one financial freedom where they can get it en-cashed whenever the need be. If you have more money then you get more freedom, the proportion is rightly stated. With financial freedom, one can have a better life for oneself and their loved ones. Given below are top reasons why investing in real estate is a productive decision and the excellent way to protect your wealth.

a. Positive cash flow

Investing in real estate gives you positive effects by saving your money and getting good returns over years. Leasing your properties will give you regular flow of income and at the same time help secure your assets. Real estate investments are the best in terms of return money you get.

b. Leveraging to multiply the value

This is perhaps the most important characteristic of commercial real estate investments; one can place debt on the asset that is multiplied several times than its original value. It helps you to invest in more assets with less money, helps to increase equity as the loan is getting paid.

c. Investment hedging

For every investment that is made, there are great returns that are awaiting you. Real estate investments have historically been known to show highest correlation to inflation as compared to other asset values. Generally, when inflation rises, the prices of real estate having high-ratio of labor and replacements cost also raises giving benefits to investors.

d. Capitalizing on physical assets

Investing in property is an income producing resource; it’s a hard asset to invest in a very meaningful way. The structure of the property land carries value and it only appreciates over time and gives a lot of value addition for years to come. Real estates are an on-going ever so green best investment options for good returns.

e. Maximize the taxing benefits

Government gives a lot of tax value benefits to investors who are investing in real estate. Usually, when a person sells the property, he has to pay income tax to government for the income but if he puts that money into buying another property than taxes are not levied. A person can get very good benefits by investing in real estate ordinarily.

Article Source: http://EzineArticles.com/9839986


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

 

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Why Haven’t You Fixed This Yet?

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You know the feeling, Christmas is fast approaching and the whole family is coming for Christmas dinner. All of a sudden you find yourself playing caterer, cleaner, menu designer, shopper, waiter and, of course, Chef! The pressure is rising you as you battle through the options of how you can possibly cook a turkey for 20 people, with all the trimmings, but you battle on anyway. The big day is planned! And a month out – what could possibly go wrong?

Then bang! The oven fails; which is fine, I mean how often do we use an oven in summer anyway? Except Christmas day, of course. So, you think that there is no need to worry because Christmas is still a month away… we will call the property manager in a few days’ time and they will fix it straight away! Because, after all, isn’t that what the property manager does, fix ovens?

So you finally get around to contacting the property manager, who of course realises that this is an oven and needs attending promptly, so the property manager sends a work order to the appliance repairer to get them to investigate and hopefully fix as soon as possible. In some instances the property manager has their hands tied because a fastidious landlord needs to be notified and approve of such a direction prior to the property manager engaging a repairer (or any other tradespeople). Meanwhile a few days has already passed since the oven broke down. Don’t worry, you think, it’s OK, there are still 3 1/2 weeks until Christmas…

Well, like most trades, appliance repairers are very busy, and I mean, very busy! They can’t come out to inspect the problem for at least 3 or 4 days as they are fully booked. Now, let me point out, if you owned the property (not a tenant) the same issue would apply, except most likely worse as the appliance service man would rank their “better” customer ahead of the once off oven repair. Of course, in this instance, your property manager is the better customer. This is because we give them lots of business every week and they hope that we will continue to do so, therefore, they look after your property manager as best they possibly can.

Now, back to your growing stress! The serviceman is booked and will be coming on Monday, but that’s OK because its still 3 weeks until Christmas, and surely they will be able to find the problem and fix it with plenty of time to spare. Not so likely, I’m afraid. Chances are there is one of 2 scenarios: scenario one, a part needs to be replaced; or scenario 2, the oven needs to be replaced. Simple right? I’m afraid not.

Let’s consider scenario 1, the thermostat is broken and needs replacing. OK, no big problem, surely? The property manager reports back to the landlord (after trying to get hold of them for a day or 2) that the thermostat is broken and needs replacing, of course the owner isn’t happy about the expense, but agrees to proceed regardless. The property manager then goes back to the appliance repairman and authorises the repair. No big stress, there is still two and a half weeks until Christmas.

But, the thermostat needs to be ordered, and guess what – not from Frankston, but Frankfurt! That’s a week for delivery, assuming all goes well. All is good; Christmas is still a week and a half away, so plenty of time. Oh no, it is Christmas remember? Everyone is now on a “go slow”, especially parcel deliveries who are inundated, so now the 1 week delivery is 2 weeks. OK, I think you get the point; the oven won’t be fixed in time for Christmas!

Maybe we should hope for scenario 2, a new oven is required… Well, there is a process here too; first and foremost are quotes. It is feasible and expected that a landlord would require three quotes for a replacement of an expensive item like an oven, and often a landlord will want to investigate themselves (as they are of course entitled to do). The process of gaining quotes can also be a long one. Why? I’m not really sure, but maybe people don’t really enjoy spending time quoting because they fear the likely possibility of not getting the work when they are so busy just trying to stay on top of the call outs. In short, delays will occur. I haven’t even mentioned the problem of size, what size was the old unit, what size is the available space? There might even be cabinetry to fit, these things are rarely “plug and play”, shall I dare mention compliance changes – no, lets not go there as well, that’s a whole other story!

Please appreciate that this is a standard situation, it happens all the time. It is not the property manager’s fault, it’s not the landlord’s fault nor is it the appliance repairer’s fault, and it is just the system and timing differences of numerous parties trying to fix a problem. This is, of course, the example of an appliance; appliances are the most difficult in timeline as often parts will need to be ordered, but please appreciate that this scenario also applies to all repairs and many maintenance issues.

The moral of the story is an easy one, even if you were the owner of the property these delays would still apply, and perhaps the delays would be even longer. So, consider this before giving your property manager a serve for the fact you need to cook your turkey on the barbecue this Christmas!

Side note: This is a true story, my oven is in fact broken and I can’t see it repaired in time for Christmas, but no fear, BBQ turkey it will be, and it will be spectacular!

With a long family tradition of living and working in the Local area, Guy has over 30 years of investment and asset management experience.

Guy brings to the Property Management team at Christopher Russell an eye for detail and a commitment to building strong and successful long term relationships. His warm, confident and respectful style makes Guy easy to work with in order to gain the best outcomes, for both tenants and landlords alike.

Firmly committed to our local community, Guy has a keen passion for sports – as a runner for his son’s Canterbury Cobra’s football team, as a competitor in triathlons, rowing, trail running and as a spectator for his daughter’s Camberwell hockey team.

More recently, Guy has focused upon his portfolio management experience, including managing high net worth clients’ investments (totaling over 230 apartments) in Port Douglas, FNQ. This experience has given Guy a unique insight into the importance of developing and maintaining strong working relationships with tradespeople, bodies corporate, property owners and tenants in a high volume, close proximity environment.

Article Source: http://EzineArticles.com/9592980


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Real Estate Tips For Beginners

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Have you always wanted to invest in real estate but don’t know where to start? Here are some of the different areas of the industry that you can invest in:

Areas That You Can Invest In

Residential: these are properties such as townhouses, apartment buildings and vacation houses. Here a person or a family will pay you in order to live in your property. The length of time that an individual lives in your house depends on your rental or lease agreement.

Commercial: commercial real estate consists mainly of office buildings. When you construct office buildings you can rent them to companies and small business owners. Again the length of time that the business owners use your property depends on your agreement.

Industrial: this one consists of car washes, storage units and any other special type of real estate where customers use your facility on a temporary basis.

Retail: it consists of trip malls, shopping malls and any other retail storefronts. When you construct a mall, you can rent it to a person interested in running it or you can run it yourself.

Mixed-use: this is where you combine any of the above categories into one project. For example, you can construct a storied building with offices, malls and residential areas.

Real estate investment trusts (REITs): this is where you invest in real estate trusts. When the mortgages generate profits, you get a share of it.

Tips on How to Be Successful In The Industry

For you to be successful in the real estate business you need to do a number of things:

Involve an attorney: regardless of the area of the industry that you are interested in always involve an attorney. A good attorney will help you in finding the right construction company. The attorney will also help you in writing professional rental contracts.

Neighborhood: the area where you invest in greatly determines the amount of money that you will make from your investment. To be on the safe side always go for a neighborhood that is growing or has the potential of growing.

Run the numbers: many investors assume that when they construct a building they will have a tenant, which is usually wrong. Before you invest in a building you should run the numbers and find out if you will be able to pay the mortgage if the property sits empty. If you find that you can’t be able to repay the mortgage in the event that the property doesn’t have a tenant for a month or two, chances are that you are stretching yourself too thin.

Article Source: http://EzineArticles.com/9016172


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

 

Passive Income – Making Money Work for You

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In the current economic climate it is more important than ever to not only work hard but have your money work hard for you. These days just about everyone puts in a lot of hours at their place of employment. However, in the past few years the job market has failed to provide the security/stability that people are looking for. Jobs that many used to rely on to provide for their families have vanished with many pundits proclaiming them defunct, never to return. In addition, many people are questioning the effectiveness of the stock market as a means of growing their retirement funds in light of the recent crash and subsequent volatility. With the collapse of trusted institutions such as the job market and stock market many people have been looking for alternative vehicles that they can entrust their hard-earned dollars to in order to help grow their wealth. More and more people today are realizing the importance of finding sources of passive income to help supplement or in some cases replace the earned income from their jobs.

What is passive income? Passive income is typically considered money generated by any trade/business or income-producing activity which the individual does not participate in directly. For example, royalties paid to an author from having his/her book published would be considered passive income. Another example is if you were to write a song and received royalties for that effort. Unfortunately, the likelihood of becoming a successful author or songwriter is not a viable option for most of us. There are also a multitude of online systems geared towards generating ongoing streams of income. Everything from affiliate marketing to blogging has been touted as the definitive way for people to supplement their income or escape their day job. In other cases passive income is derived from owning an asset such as a business or real estate. In the case of real estate passive income comes in the form of rent collected from tenants.

This then prompts the question, how do you determine the most effective way of generating passive income? The number of courses, systems, and programs that offer ways of making money can seem overwhelming. So how do you narrow down the options? When doing research on the best system/investment to employ I would recommend you keep the following in mind:

  1. Are there any tax benefits associated with the vehicle you’re looking into? As many accountants and financial planers are fond of saying, it isn’t just how much you make it’s also how much you keep! You could cultivate a healthy source of additional revenue only to have the government cut out a hefty slice come tax time.
  2. Does the vehicle in question allow you to leverage other people’s time/resources? As we are all aware, time is a very precious commodity that most of us often feel we don’t have enough of. When investigating a prospective investment or money-making system ask yourself if this will help you to grow your wealth without severely impacting your already hectic schedule. For example, with real estate investments you can usually enlist the services of a property management company to oversee the day-to-day operations for a modest monthly fee. Having a professional team looking after your asset(s) is usually preferable to doing everything on your own!
  3. Does the system or investment you’re looking into offer a good return? There are many courses or investments that cost hundreds, sometimes thousands of dollars. Many of these systems promise the world but don’t necessarily guarantee anything in the end. If there is a particular money-making system or investment you’re interested in be sure to do some research. You can often find blogs set up by people who are already using that same system; this can provide you with invaluable information to assist you in determining whether or not to make the investment or move on.

If you are interested in establishing a source of passive income you may want to consider Turnkey Real Estate Investing. It offers a number of tax benefits, it allows you to leverage other people’s time & resources, and often times it provides a very good return on investment (ROI).

Article Source: http://EzineArticles.com/5034770


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

 

Things to Know Before Investing in Real Estate Outside of Your Market

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Investing in cash-flow real estate is an excellent way to build wealth. However, many investors find themselves in a situation for one reason or another where they cannot purchase cash-flowing real estate in their local market. If you find yourself in this situation, your only option may be to purchase property in another market, and this can present several challenges. Purchasing real estate outside of your local area can be done successfully, and if you pay attention to the things below, you will increase your chances of success dramatically.

Find the Right Location

When it comes to real estate, you have probably heard of the first three rules: Location, Location, Location! The location of the property is probably one of the most important factors you can choose. When considering cash-flow investment properties, you should be looking for working class neighborhoods that have well cared for homes. These are the best locations to invest in because these neighborhoods have a higher demand for rentals, and they are more reasonably priced creating potential for higher returns.

Find the Right Property

When purchasing rental property, you need to make sure you are purchasing properties that will give you the best chance for success. You should be looking for “bread and butter” rental properties which can be defined as properties that meet the following criteria:

  • Sized at 800 to 1200 square feet
  • 3 or more Bedrooms
  • Has a basement
  • Has a garage

Homes that meet these criteria are called bread and butter properties because they meet the demand of most prospective tenants. By purchasing properties like these, you will have the largest pool of prospective tenants to rent to, and thus your rents will be higher and your vacancy rates will be lower.

Find the Right Tenants

Your tenants are one of the biggest keys to making a real estate investment property successful. If you select the right tenants, you will reap the returns you expect. However, if you select the wrong tenants, your investment can become a liability very quickly. The key to finding the right tenant comes down to conducting the proper tenant screening. This includes:

  • Proof of income
  • Criminal history
  • Rental history
  • Credit check
  • Personal interview

If you make these checks you will get a very good idea about the prospective tenant and you will be able to make an informed decision whether to rent to them or not.

Get the Right Protection

An old joke with real estate investors is that the definition of a tenant is “a plaintiff”. Of course it is not true that you will get sued by every tenant, however, the point is that there is a high likelihood that you could get sued while investing in real estate. Therefore you need to protect your liability, and there are several strategies that you can and should implement to protect your liability. These strategies normally include how you setup your entity structure and the insurance you have for your properties. Before making any decisions about your entity structure or insurance you really should discuss them with a real estate attorney.

Set Your Business up Right

To make the most out of your investment you need to have your business structure and taxation setup properly. There are many opportunities for tax planning while investing in real estate, and making the proper plans can save you a lot in taxes. Everybody’s situation may be slightly different, and therefore you should discuss your real estate investment goals with a CPA experienced in working with real estate investors.

Find the Right People

To invest in property outside of your area, one of the most critical things to do is to find the right people to invest with. At a minimum, you will need a real estate agent, a property manager, a general contractor, a CPA, and an attorney. Finding all of these professionals in the market you are looking to invest in can be a very difficult task, however there is an alternative. Rather than try to find all of these professionals yourself, you can decide to work with a company that specializes in putting together turnkey investment properties. The advantage to doing this is that you will be working with a company that has already established all of these contacts, and they will have a very good idea about the real estate market they work out of.

Article Source: http://EzineArticles.com/5613573


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Why You Should Buy Investment Properties in Memphis Now

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One of the most important decisions that you will make in real estate investing is choosing the right city, and then the right neighborhood for your income property. This article shows you why you should seriously consider Memphis investment properties if you are looking for a good deal likely to bring you sound profits.

Memphis Real Estate Overview

When thinking about investing in real estate, Memphis, TN might not be the first market that comes to mind. However, this should change. Memphis is one of the hot real estate markets for 2016, and this will continue in 2017 and beyond. Wondering why?

Here are the reasons why Memphis investment properties are a great idea at the moment:

  • Affordability

Both for homebuyers and for real estate investors, housing prices are a key factor. Memphis investment properties are really affordable right now. Median home prices in Memphis are less than half of the national average. Condos, single-family homes, townhomes… Various types of Memphis investment properties are all available at very reasonable prices, below the national averages.

Well, part of the explanation for the relatively low property prices in Memphis is that household income is also below the nationwide average values. This fact will work well to your benefit if you are not from Memphis (and thus enjoy a higher income) and are considering out-of-state real estate investing.

  • Millennials

If you are thinking about Memphis investment properties, your target tenants should be the Millennials. The Memphis population is generally young, which means that they still cannot afford buying a home on their own, at least not in the next few years. You should take advantage of this reality and invest in a rental property which can accommodate a small family.

  • Southward Migration

It is not only local Millennials that make the Memphis real estate market hot but also such migrating from northern locations with less amiable climates. As Millennials across the nation are starting to get married and have children, many of them are willing to move away from the busy 24-hour cities into places which offer a home with a yard with place for a car and a dog. Memphis is an ideal location because of the availability of such homes and because of the nice weather.

  • Young Population

The next reason you should really think seriously about Memphis investment properties is demographic again. As we’ve just mentioned, Memphis enjoys a relatively young population (15% of the people are under 9 years of age). So, investing in the Memphis real estate market is not only an excellent option in the short run (to accommodate the Millennials without a home yet) but also in the long term (to provide housing for these youngsters when they grow up in 10-15 years and want to move out of their parents’ homes).

  • Moving Towards a Seller’s Market

It is not exactly clear whether Memphis real estate market is a buyer’s or a seller’s one at the moment. What is clear though is that it will soon be an evidently seller’s market as inventories have started to decline. If demand continues increasing, inventories will drop even further, while prices will go up. So, it is now the time to buy Memphis investment properties.

The Numbers

Real estate investing is all about numbers, so let’s take a look at the Mashvisor analytics of the Memphis real estate market:

  • Median Property Price: $182,000
  • Traditional Monthly Rental Income: $936
  • Airbnb Monthly Rental Income: $2,130
  • Traditional Cash on Cash Return: 2.3%
  • Airbnb Cash on Cash Return: 9.9%
  • Traditional Cap Rate: 6.9%
  • Airbnb Cap Rate: 15.0%

These numbers tell us a few clear points:

  1. Memphis investment properties are really affordable at the moment. Hurry up! This might not last for long.
  2. Airbnb is definitely the optimal rental strategy in Memphis as it is way more profitable than traditional renting.
  3. Memphis Airbnb is actually quite a good deal with expected monthly rental income of $2,130, cash on cash (COC) return of 9.0%, and a cap rate of 15.0%.

Top Memphis Neighborhoods

Once you’ve settled on buying one of Memphis investment properties, you have to make another important decision: which neighborhood is the best. Mashvisor data points out to a few top neighborhoods in Memphis for investing in real estate. The common thing among them? That they are all much better suited for Airbnb rather than traditional renting.

So, let’s look at the top 3 Memphis neighborhoods for real estate investments:

1. Midtown

  • Median Property Price: $162,000
  • Traditional Monthly Rental Income: $778
  • Airbnb Monthly Rental Income: $1,948
  • Traditional Cash on Cash Return: 1.5%
  • Airbnb Cash on Cash Return: 10.0%
  • Traditional Cap Rate: 6.1%
  • Airbnb Cap Rate: 15.2%
  • Airbnb Occupancy Rate: 64.9%

Midtown is one of the most affordable neighborhoods for Memphis investment properties, with an median property price of $162,000, which still offers excellent COC (10.0%) and cap rate (15.2%) for Airbnb. The Airbnb occupancy rate is quite high at 64.9%. Midtown is a lively area with many cultural, entertainment, food, and drink options for any taste. Overton Park, located in Midtown, hosts the Memphis Zoo, the Memphis Brooks Museum of Art, and the Memphis College of Art in addition to a nine-hole golf course.

2. Cordova

  • Median Property Price: $195,000
  • Traditional Monthly Rental Income: $1,017
  • Airbnb Monthly Rental Income: $2,166
  • Traditional Cash on Cash Return: 2.5%
  • Airbnb Cash on Cash Return: 10.3%
  • Traditional Cap Rate: 6.9%
  • Airbnb Cap Rate: 15.3%
  • Airbnb Occupancy Rate: 46.7%

Cordova also has cheap properties with median property price just below $200,000. Airbnb promises very good returns in this neighborhood. Unlike Midtown, Cordova is a suburban area which has something for both nature-lovers (fields, wooded terrains, horseback riding, and biking, hiking, and jogging trails) and urban populations (shopping centers, retailers, restaurants, cafes, business, and office spaces).

3. Downtown

  • Median Property Price: $240,000
  • Traditional Monthly Rental Income: $875
  • Airbnb Monthly Rental Income: $3,057
  • Traditional Cash on Cash Return: 0.9%
  • Airbnb Cash on Cash Return: 10.7%
  • Traditional Cap Rate: 5.0%
  • Airbnb Cap Rate: 15.3%
  • Airbnb Occupancy Rate: 53.4%

Although a bit less affordable, you should also consider Memphis investment properties in the Downtown area as the expected monthly rental income from Airbnb according to Mashvisor is above $3,000. This is the most diverse, lively, and eclectic area in Memphis. A home to art, music, dance, and theater options, it is a cultural hub. In addition, it hosts several museums and historical places.

Article Source: https://www.mashvisor.com/


 

Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

4 Ways To Wholesale Real Estate

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Want to invest in real estate with no financial risk and no money or credit? Wholesaling houses is a popular choice. I personally think wholesaling can be a challenging way to get started, but the fact that you can get started in real estate investing without any barrier of entry makes wholesaling an attractive option. If you can get good at this side of the business, you will be success with anything you want to do. The reason I say that is finding deals is what makes a wholesaler successful. If you can get good at finding deals, you have unlimited potential.

Once you find a deal, you need to understand how to sell it to make your profit. Here are four ways you can structure your wholesale properties.

Contract Assignment: This is the easiest, but comes with some risks if not done correctly. It is also somewhat restrictive as bank owned properties will prevent this. This works well when you negotiate your deals directly with the seller. The way this works is you will get a house under contract and then you will assign your rights in the contract to another buyer for a fee. That new buyer will take on the rights and responsibilities in the contract and will close in your place. It is best to get your fee paid up front, but it is very common to get your fee when your buyer buys the house. Here are a few things to keep in mind when assigning contracts.

Be sure that you always disclose to your seller that you are or may assign the agreement to another buyer for a fee. I suggest you actually put this in the contract. Sellers should be OK with this if you are transparent that you are an investor who buys houses for a profit before you start to negotiate.

I would get money from your money that is at least enough to cover any earnest money you put up with your seller. That way if your buyer defaults on the agreement you at least cover your costs. Always try to get the entire fee paid when you assign the contract.

I like this way the best because it is easy to do on your end, it is easy for the buyer and the buyer’s lender, and it is the cheapest way to go.

Double Close: This just means that you actually buy the house and then resell it. There are several ways to do this, but the most common is to buy and sell in the same day or within a day. Typically, you will need to bring in financing to get your closing done with the seller, which is why this is my least preferred method to wholesale. Also, because you have two closings you will have two sets of closing costs, so it is the most expensive way too. With that said, some wholesalers prefer this method because they do not have to disclose to the seller their intent to resell and they can both keep their deal with the seller and their deal with their buyer private. It is believed by some that this is a good way to protect your profits. The information will all become public record at some point, but that is well after the closing.

This is the method you will use by default if you do not do your contract on the front end correctly, so we do see double closing frequently.

Flip the Entity: This has become the most common way to wholesale in my market. Most, if not all, the successful wholesalers will use this strategy. Especially when wholesaling foreclosures where contract assignments are forbidden.

The way this works is the wholesaler will set up a separate entity, like an LLC or a Trust, and put that entity as the buyer of the house to be wholesaled. They will then sell the entity itself for a fee. The benefit with using this strategy is that actual contract on the house does not change. Since the buyer of the house is the entity, there are no issues with any regulation or assignment restrictions. The downside is it could be more work because of the extra step to set up the entity, and there could be additional fees to register the entity with the state. The risk for the buyer is whenever you buy a company you are buying all of it. So, if the entity was used in another transaction and owes money to anyone, the new buyer could be on the hook. Knowing this, the best way to do this transaction is with a brand-new entity used for this one purpose.

Relationship Close: I don’t know if there is an actual name for this method. In fact, it is rarely seen. What I mean by relationship close is that you have such a strong relationship with a buyer that you write offers in the buyer’s name. For this to work, you should be a licensed agent and preview houses for your buyer. You would need to understand their criteria and only offer on houses they will want to buy. I have a client that works this way. He has an agent write his offers and the agent/wholesaler gets paid a commission with each successful closing. They do 2 to 3 deals a month with this strategy. My client just signs contracts without looking at them at this point and trusts what the wholesaler is putting together solid offers. There is always an inspection clause protecting the buyer and the agent, but more than 9 out of 10 houses that go under contract close. That is because the agent/wholesaler knows the business and knows what this buyer will buy.

Article Source: http://EzineArticles.com/9826578


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 12 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com