Virtually any state in the country has the appeal of multiple small towns. Ask almost anyone who lives in small town why they are here and they’ll tell you they enjoy the small town feeling while being close to all the conveniences of a larger city. One of the greatest joys of living in a small town is how familiar people are with one another. When you walk into a store or restaurant you are welcomed by name. As an area grows, you risk losing the "down home" charm.

On the other hand, due to the growth in many areas you will find a more diverse population. This too has appeal to many. Maintaining the magic that is small town while embracing the inevitable changes that are occurring is something everyone in your community can participate in.

One of the appeals of a small town is how longtime residents frequently make an effort to get to know the new folks who move into the area. For those who are new to the area introduce yourself to your neighbors. Whether a familiar face in your town or new to the area you can host a block party to get to know your neighbors.

Knowing whom you live next to is more than a neighborly thing to do. It is also a safety measure you can put in place. Exchange phone numbers with your neighbors so that if there is ever an emergency you have someone close to call on.

For newer residence ask your neighbors about the community. Seek out a common-interest support network. On the other hand, be willing to stretch beyond your common-interest support network. Human nature is such that often we only associate with those whom we feel we have something in common with. Due to the changing face of our country, you will find there are often some incredible opportunities to learn so much about many types of people.

Familiarize your children with the neighborhood. Find activities for your children to join in on. This is a great way for young people to quickly adapt to a new area.

If you have pets, make choosing a veterinarian a top priority. Often, animals develop unfamiliar behaviors when relocated. Unfortunately, there may be occasions where an emergency situation occurs with a pet when you first move. It is best to have a good vet who you feel comfortable with rather than have to try to find one in a panic. Talk to your neighbors to find out whom they recommend.

Check the local paper to find out about classes, seminars and events being held in the area. You may be amazed at how much goes on here. If you have a special event coming up contact the editor of this paper to let them know. The editor welcomes timely and relevant information.

Regardless of where you live in this great country, there are fantastic communities that can be enhanced by each and every one of us.

Copyright

There is more to buying raw land than meets the eye and more than a few individuals have wished they’d had a second chance upon finding themselves duped, conned, misled, ill-advised, uninformed, oversold, undereducated and often unprepared. They realize, often too late, that a raw land purchase should be properly investigated, evaluated and negotiated using a logical and rational plan.

Let me start by saying I’m not a geologist, soil analyst, surveyor, engineer or land consultant. I’m a passionate real estate investor, licensed agent, appraisal assistant and landlord who purchased various raw lots, as large as a 15-acre parcel, for investment and building projects. In addition, I have consulted with numerous individuals proficient in real estate, who have contributed to my general awareness of the conditions and merits of raw land. We, as small investors, can further use this information to our advantage in wisely choosing land and utilizing it to it’s highest and best use regarding fulfillment of our needs, wants and desires.

This chapter is not a technical sleeper and as such, it will not go so far as to tell you how much lime to add to your soil to adjust PH levels (7.0 is neutral) but it does try to get you thinking about some of the more general considerations that can lead you to further investigate your options using this material as your starting point.

With that said, the first question I’ll ask you is what exactly do you intend to do with this land once you have it? Why are you buying it? What purpose do you have in mind for land? Are you going to build a home, purchase a lot for retirement or investment? Will you acquire considerable acreage for farming or subdivision? Do you want commercial, residential, recreational or agricultural? Will it be in the north, south, east or west?

So your first question should be, what am I, or we, buying this land for? Will it satisfy my, or our, requirements? To get answers to these questions you would best be served by talking to those who will be most intimately involved with the land, such as your spouse, partner, family members, associated owners, etc. Once you have a clear understanding of what the land is supposed to satisfy, then your search can begin. So often people waste their time and effort because the significant partners have such a wide gap in what each person truly wants from the purchase that they never settle on anything or end up with much less than they could have had.

Land can be said to consist of soil, geology, water and climate. Whether you’re looking at beaches, mountains, deserts, high plains or city lots, they all have some basic components. Some of the basic requirements we most often seek are clean air, water, electricity, sewage disposal and trash removal.

Clean air might be construed as freedom from dusty roads, smog, foul smells from industry or landfills, free from noise of traffic, airports and/or neighbors.

Water availability is essential and is often desired for aesthetics as well as drinking, bathing, washing, cooking, cleaning, toilet facilities and watering vegetation. We also enjoy lakes, rivers and streams for recreation. Others enjoy the tranquil sounds that our streams, rivers and oceans can provide. Without a doubt, water availability is a major concern. Note: A 1666 square foot roof can capture 1000 gallons of water for each inch of rainfall; cisterns of all types have existed since the dawn of man.

Electricity is another necessity that we often take for granted. Is a power plant within a reasonable distance from the land or will it cost you thousands of your own dollars to run cables across public lands to get your electricity hooked up? How far are gas and oil suppliers?

Sewage disposal – 25% of our country is on a well and septic system. If you don’t have access to public utilities, will your land support a septic system as well as the water to operate it?

Solid waste disposal – how far is the landfill? Is there a collection service? You can’t burn everything; how will you get rid of it?

Those are the major necessities for modern, everyday living?things that we really need, but can often overlook until after the contract is signed. Others essentials are a telephone, mail delivery, shopping, police, fire station, hospital/emergency services, schools, churches, recreation facilities and access by good roads and highways.

You’ll want answers to questions like those above and county officials such as planning and zoning, community development and building departments are a good place to start. I would also call utility companies about water, sewer, electric and phone, and talk to neighbors, contractors, developers, real estate agents, appraisers and a local surveyor to have some of the more important questions addressed at the beginning of my search. I wouldn’t rely on the sellers to be all-knowing, either.

Again, planning and zoning departments can offer the following: Maps of existing uses, forecasts of future development, lists of planned new roads, utility extensions, locations of planned waste disposal facilities, details on environmental areas and future land uses. They also regulate building codes, curb-cut permits, historic preservation, housing codes, subdivision regulations, tree cutting and zoning laws. They usually have aerial photographs and plat maps that can help you to better identify and evaluate the land in question.

Do you already have your location identified? Will it be in the east where the weather is often wet and humid or out west where it is predominantly arid and dry? Will you be living in cold weather in the north or gravitating towards the southern hemisphere? Concerning location, what are you least comfortable with: Avalanches, landslides, earthquakes, flooding, hurricanes, tornados, tsunamis, volcanoes and/or wildfires? You may want to investigate areas of interest by going to websites like http://www.officialcitysites. You will get a better picture of what awaits you concerning it’s economy, environment, population, recreation, educational, medical and employment facilities to name a few.

Let’s assume you know where you want to buy this land, why you want to buy it, and how and when you will use it once you have it. The following general observations, ideas and information may help you to further investigate the alternatives that are available to you in your endeavor to find the land of your dreams.

Raw land is unimproved property; it has no utilities, sewers, streets or structures and usually must be cleared.

Here are (or can be) a few drawbacks that are sometimes associated with raw land:

1. Negative cash flow; usually the land does not generate any income while you pay the principle, interest, taxes and costs of development.

2. Tax advantages are scanty as land cannot be depreciated.

3. Generally, raw land is considered a long-term ill-liquid investment that often takes time before gains can be realized.

4. Risk of loss on resale can occur if you choose poorly, fail to evaluate and negotiate properly, the economy slips or various other unforeseen events occur.

5. It is difficult to obtain traditional financing on or borrow against accrued equity.

Here are some possible benefits to raw land:

1. Land has the potential to experience tremendous appreciation if bought in the way of growth, or if a higher and better use can be achieved.

2. Owner financing can often be obtained through the seller at below-market rates.

3. Subdividing can create added value and provide for immediate returns.

4. Privacy and pride of ownership can provide a secure feeling to the holder.

What is considered good and bad land?

The worst you can buy is swamp or marshland. Most often flat land is the least expensive to develop and the most desired for building purposes. Land with barren rock will increase costs and virtually eliminate a basement just the same as a high water table.

Note: Loamy soil, which consists of a balanced mixture of clay, You will most often be contacting many of these sources by writing to them. Don’t get discouraged when you don’t get immediate replies, as the average response rate is one reply for every eight letters that you send. The pros will get on lists and pay services to monitor many of these potential sources, however, good old-fashioned detective work does pay off. When researching in this manner, secrecy is one key and fast action using all cash is the other.

A special consideration to note when hunting legally challenged property is to have a sand and some organic matter, appears rich and dark in color and is considered ideal for most purposes. As opposed to good soil, you don’t want hard cracking ground when dry and sticky soil when wet. Warning! Check with your state offices for the presence of expansive soils; this stuff cracks foundations in the most insidious ways, leading many to ruin.

Many people are literally being driven to the hills. Granted the views can be spectacular but roads, utilities, water, sewer, and foundations, such as pilings, can add 25-30% to building costs alone, further adding to this already expensive proposition. When considering going vertical, an 8-degree slope is about the limit when concerning building economically on hillsides.

Plots with trees, a view, rectangular in shape, a gentle slope or none and a good location are most often preferred, and streams can boost values by 100% in some cases.

How to determine the value of raw land

Using the appraisers standard view of estimating value can give us some clues, so let’s look at what appraisers do!

? Site size and shape, represented by frontage, width and depth.

? Corner influence equals visibility for commercial, or privacy for residential.

? Plottage, has assembly or combining of parcels been accomplished.

? How much land is excess or surplus; surplus has less value than what is required.

? Topography: Land’s contour, grading, natural drainage, soil, view and usefulness

? Utilities: Sewers, drinking water, natural gas, electric, telephone, cable, etc.

? Site improvements: Landscaping, fences, gutters, walks, drives and irrigation

? Accessibility: Parking, location, streets, alleys, connecting roads and highways

? Environment: Climate, adequate water supply, air quality, streams, rivers, lakes, oceans and the absence of any hazardous materials

An old timer once gave me this advice: He said, "Dan, always try to buy land that is located as close to those amenities that an area is famous for, as that is often the reason people come to certain areas. He lived in Florida and had plenty of beachfront property located in tourist areas, which clearly illustrated his point.

Who has this raw land and how do we find it?

You may start your search by contacting farmers, investors, real estate agents, state and federal agencies, cities with odd lots they need to put back on their tax rolls, bureaus of land management, federal marshals, tax sales, bank foreclosures, developers, property heirs, the elderly, and family and friends. Use your networks and birddogs while driving areas of interest looking for further opportunities to buy.

Property is often advertised through newspaper ads, real estate brokers, For Sale by Owner signs, flyers, bulletin boards, the Internet, etc. A quick note on how not to buy is in order here. I would not recommend buying land from a glossy brochure or big development company as it is almost always overpriced to cover large overhead costs, advertising and profit. Also remember when a building boom is on, land prices rise. You will do much better buying when demand is low. Another caveat is to stay away from land that is advertised outside of its normal market as it is often overpriced or has problems; otherwise, a local buyer would have bought it!

If you want to find the deals, then most often you are going to have to dig for them. A few successful methods may include visiting the county clerk/recorder’s office to search the public records for the following:

? New probate filings, use them to contact heirs

? Eviction proceedings to contact out of state landowners

? Arrests – these people may need money and may also be going away for a while.

? Bail bondsman who may have forfeited collateral in the form of land.

? Divorces filed, leading to a division of assets

? New guardianships to contact disinterested heirs

? Deeds in lieu of foreclosure, private sellers may in turn sell it to you.

? Lis pendens means litigation pending, often signaling foreclosure

? Title company in addition to the regular search of mortgage.

? Tax and easement liens also check files for I.R.S. liens, bankruptcy filings and judgment liens.

Quick review

Up to this point we have talked about not getting conned when starting out. We also noted that it pays to understand what everyone wants from the land to start. You are aware that utilities and basic necessities are very important considerations. You know whom to contact to get further in-depth information on properties of interest. You know flat land with natural amenities is the most desirable and economical to develop. You are more familiar with the risks involved with this type of real estate and you also know that rock, marshes and hillsides can be expensive to develop. You have a better idea of how an appraiser begins to determine value and you may have a few ideas on how to find land and the people who own it.

With that said, we are ready to get down to the business of evaluating, negotiating and financing our well-sought piece of terra firma. What follows is a basic checklist. There is more to consider but this will get you off to a running start.

Basic Raw Land Checklist

? Get the most recent and valid information available: A copy of the deed containing the legal description with any covenants and/or restrictions.

? Get the street address, a plot plan indicating the specific property location, a survey, a preliminary title report, a recent map and any aerial or land based photographs to help you locate fence lines, trails, roads, streams, ponds, building locations, etc. Walk the land to verify, evaluate and correlate what is indicated, also looking for any signs of hazardous waste dumping, burying or burning.

? Determine present use in zoning, according to what planning and zoning tells you. Symbols are used to designate uses – here are a few:

A1: Agricultural with single family home
C: Commercial business
CO: Commercial office
FP: Flood plain
M: Industrial
R1: Residential single family
R1H: Residential hillside
R2 : Residential multifamily
RT : Recreational tourist/ Residential transitional

General categories include:

Farm, Ranch and Timberland
Recreational or Resort
Industrial
Commercial/Business
Residential
Mixed use

? Confirm who owns it, their full name, address and phone number
? Find out what they do; are they a dealer in real estate?
? Ask if anyone else is on the title or has authority to act
? What are the annual taxes and assessed values?
? Ask why they are selling and how long they have owned it
? If the owner doesn’t want to sell, ask if they would consider selling a parcel of it.

The preceding is an abbreviated checklist. It is meant to get you started off on the right foot. Many people will research buying a new car more thoroughly than they would when buying raw land; there are many good books that are devoted solely to the subject of raw land. This type of investment is generally not the best choice for the new investor but often times people look to build they’re dream homes away from developed areas and for that reason I have included my two cents here.

Finance considerations $$$

Raw land as opposed to improved property is much more difficult to finance through traditional lenders. The main reasons are that it generates very little income, development costs can be expensive, there are no buildings or improvements that can be used as collateral and it is often considered speculative.

For those reasons mentioned we find that sellers are often our first choice regarding financing. It is typical for a seller of raw land to accept 10% down and the rest to be paid over time at a specified (below market) interest rate. This would be an example of an installment land contract. Other forms are contract for deed, mortgage and note and purchase money mortgages. In these cases, a real estate attorney usually drafts these contracts and a bank will act as an escrow agent to facilitate verifiable records of payments received. The seller often retains the deed until the property is paid for in full.

If you want to investigate bank financing, then you may start out by offering 30% down with a seven-year mortgage, with the bank getting an extra percentage point over and above the current interest rates for standard loans. This may not be accepted but it does give you a starting point to see just what they may be willing to do.

If you plan on building on your land, then having a development plan with an appraised set of blue prints for the project will help the lender in justifying your loan. If you can use equity from other property, then paying substantial down payments may also be an option.

My final words of caution here would be to know values and don’t overpay. Always offer less when possible and research recent sales of comparable properties. The larger a parcel is, the cheaper it tends to get per acre. Ask an agent what an acre of land tends to go for in the area that you are considering; try to buy more than one acre.

When buying residential lots, builders try to keep raw land costs down to 10% of the overall value of the project. If streets and utilities are already in place, then they will use 25% as their guideline. If you can combine or assemble parcels or achieve zoning changes with property, you have a good chance of immediately increasing its value. Always physically inspect the property and do your research before obligating yourself to buy it. Try using contracts with contingencies put in to protect yourself. In essence, these are really options that let you control the deal while you investigate and research the land’s potential to satisfy your objectives. Happy Hunting and buy the high grounds!

Dan Auito is a dual-licensed real estate agent and appraisal assistant. Dan is a 20-year veteran of the United States Coast Guard. He has acquired over 1.3 million in real estate assets in 14 years while also founding a non-profit drug prevention corporation, a real estate consulting group and is the author of "Magic Bullets in Real Estate." This 300-page power-packed book comes with a website that further supports its readers. Please visit with us at http://www.magicbullets.com

Getting Raw Land, Not a Raw Deal!

Real estate is one of the best vehicles of building wealth. Historically real estate has outperformed other asset classes like stocks or bonds, and is reasonably predictable and less volatile. There were times when real estate went down and there were times where it went up but on an average it has given a sizeable annualized return Development report, the price of an average single-family home has gone up from $22,300 in1968 to $206,100 in 2003, an increase of 824% in a span of 25 years

There are many ways to invest into real estate. With 100 percent financing options, low interest rates and good credit it’s fairly easy to get started. Numerous articles and books have been written about investing in real estate and success stories are a plenty.

Here, in a nutshell, are some of the most important reasons for investing in real estate.

Appreciation. Traditionally real estate has been viewed as a “buy and hold” type investment vehicle. Real estate has recovered from cyclical declines and regional corrections and it may continue to do so in future, primarily because of tight supply and demand. Land is finite and housing is a necessity. According to the U.S. Census Bureau: the nation’s population is projected to increase to 392 million by 2050 – more than a 50 percent increase from the 1990 population size. These factors presents a bright outlook for real estate investors. The fact that land is finite, and population is growing will cause most real property to rebound even if there is a market decline.

Properties can be bought and held for appreciation provided one has the staying power. To avoid occasional declines, a smart investor should buy properties below market value by using creative acquisition techniques and realize a gain by quickly turning around and selling for a reasonable profit. Of course, properties bought below market value can be held for cash flow and long-term appreciation as well.

Leverage. Leverage in real estate means making money on borrowed money. The power of real estate resides in using “other people’s money.” One can buy a property with zero down (100 financing) and make a profit upon sale as if it had been paid off entirely. Let’s assume you decide to buy a duplex worth $500,000 with 100 financing. Income properties have been appreciating at an average of 7 percent per year. With a 0 percent down your property at the end of the first year is worth $535,000. At the end of the second year, it’s worth $572,450. By using leverage or borrowed money to purchase a larger income property, you have increased your profit by $72,450 in just two years. A 14.49 percent return on a borrowed amount of $500,000. This is the power of leverage. Leverage coupled with appreciation can yield high profits.

Tax Benefits. There are numerous tax benefits of owning real estate, gains from sale of primary residence up to ($250,000 for single, $500,000 for married filing jointly) is tax-free. IRS allows taking deductions for depreciating real estate assets. Legitimate expenses like interest, depreciation, insurance premiums, management fees, legal fees, repairs etc are all tax deductible. You only pay taxes on net profits.

Real estate investing is an extremely rewarding process, but it needs perseverance and knowledge to achieve success. There are several proven techniques to make quick money but the key to success resides in buying properties below market value and selling them at the market or higher market price. Great deals can be found in foreclosures, fixer uppers, distressed properties and auctions etc.

Happy Investing!

Srini Saripalli is an entrepreneur, direct marketing expert and real estate investor. He is also a business development consultant to Fortune 500 companies. He is based in San Jose, Calif. Srini can be reached at http://www.srinisaripalli.com

Investing in Real Estate Vehicle for Wealth Building

In investment real estate the quickest way to wealth is through owner financing, or lease optioning. So, let’s take a look at one model transaction, involving the purchase and sale of two properties on lease-option contracts so you an apply it to your own investment real estate system.

Assume you buy an investment property for $50,000 to $60,000, and you sell it on a lease-option contract for $80,000. You receive $4,000 as a down payment from the buyer, and you will get the remainder of the balance in 12 months. You’ve created a note for the remaining $76,000 that pays you $570 monthly (interest-only payments of 9%). This gives you nearly $7,000 more in interest payments, if you keep this property for a year. You then find a rehab property in an inexpensive neighborhood that you can get for $35,000. You offer a 10% down payment of $3,500, promising to pay of the loan in 13 months or less.

Now, you can use the $4,000 from the first property, so you don’t have to come up with your own money for the down payment on your second property. Offer to pay 8% on the remaining $31,500. This is a monthly payment of $231. Be sure your agreement allows you to defer your first payment for 30-60 days. Now, if you can’t sell the house in 13 months (this certainly won’t be a problem, though), you’ll have the cash from the first house you bought, when the $76,000 balloon payment comes due in 12 months, so you won’t lose anything or have to get your own financing, when you have to pay off your second home in 13 months.

You see, you always cover yourself, when using this approach. If you purchase smart on this second house, you should be able to put a few thousand dollars into it and re-sell it in a few short months. Be sure you make a profit well above your $35,000 purchase price and anything you have put into it. Again, if you buy smart, after a few grand of rehabbing, you should be able to sell the property for $45,000 to $50,000. You wind up making roughly $30,000 to $35,000 in a year or less on the sale of your first two properties. This doesn’t include the extra thousands of dollars in interest you’ve made on the payments you’re collecting. Learn more about this strategy at www.winningthemortgagegame.com.

Mark Barnes is the author of the new novel, The League, the first work of fiction, based on fantasy football. He is also an investment real estate and home loan finance expert. Learn more about this suspense thriller at http://www.sportsnovels.com. Get his free mortgage finance course at http://www.winningthemortgagegame.com

Investment Real Estate Done Right — Your Quickest and Safest Path to Wealth

Whether you’re a "move up" home buyer, downsizing, or relocating to the metro Atlanta area, you’ll find a diverse range of home styles and price ranges just north of downtown in the Marietta – East Cobb, Roswell, Alpharetta corridor. Featuring affordable single family homes, condominiums, townhouses, and luxury real estate, these communities also offer great schools and unbeatable location.

East Cobb is truly the hidden gem of the local real estate market. Without a large highway, neighborhoods and homes in this part of Marietta offer a peace not often found in metropolitan areas. As such, families often choose East Cobb for its kid friendliness and reputation for having top public schools. The hallmark of east Cobb real estate is its exclusivity and low Cobb county taxes. New construction homes in east Cobb differs from the rest of Marietta – it has become difficult to find a new home for under $500,000 in this area. Resale homes can be found in almost any price range in the east Cobb. Real estate values have done very well in the last few years and show no signs of slowing down. While unique restaurants and nightlife are not abundant, many are within driving distance of most any East Cobb neighborhood.

If you’re looking for the classic Southern town that has a mix of newer and older historic homes, look no further than Roswell Georgia. Real estate in the historic district dates back to before the civil war. A quaint and quiet downtown area features antique shops and top quality restaurants and cafes. Featuring access to GA 400, historic homes, and a nice diversity of new construction homes, Roswell real estate is a testament to historical preservation. North of downtown, the Crabapple community features newer homes with modern amenities, great schools, and a variety of shopping centers.

Alpharetta is one of Georgia’s most unheralded success stories. During the last 20 years, the Alpharetta real estate market has exploded with growth. New homes are going up at a tremendous rate and showing no sign of stopping. People who have bought homes and real estate in Alpharetta chose it for it’s unbeatable modern shopping and convenience. Everything in Alpharetta seems new – from its shopping centers and restaurants to its homes and office buildings. In the beginning, most residents of Alpharetta used to live there and commute to downtown. Today, we’re seeing people start to commute to Alpharetta from surrounding communities because of it’s growth.

Whether you’re looking for family neighborhoods, historic homes, or something new and exciting, East Cobb – Marietta, Roswell, and Alpharetta Georgia have something to offer everyone.

Sanford Rosser of RE/MAX Communities. Visit our http://northatlanta-homes.com site to search for homes currently for sale in East Cobb, Marietta, Roswell, and Alpharetta Georgia.

Atlanta Georgia Real Estate – Marietta – East Cobb, Roswell, and Alpharetta

I was a landlord for a decade, and I believe I probably lost a year of life for each year I tried to maintain 26 properties. I learned the hard way that the most efficient way to make money in investment real estate is to create a mortgage note and be the bank – not the landlord.

In other words, you become a private bank, financing the entire sale or part of the sale for the buyer. When you finance a sale of property, be sure to get a high rate of interest – generally 9% to 15%, depending on all of the other terms. For this article, let’s assume you sell to someone who can’t come up with all of a $20,000 down payment, so you finance $15,000 of the loan. The note should be due in five to 10 years, meaning the buyer will likely sell or refinance his mortgage within that period, and you’ll be paid in full.

Here’s how financing a portion of a mortgage can be extremely profitable and far less work than being a landlord, who is responsible for property maintenance. Let’s assume you charge 11% on your $15,000 loan, amortized over 30 years (this makes for an easier payment and a more attractive deal for the buyer, even though you’re receiving a very high rate of interest on the loan). The payment is $142.85, which includes principal and interest. Now, you could make it even more attractive for you by writing the note with monthly payments of interest-only at 11%.

This saves the buyer even more, as his payment becomes $137.50, but this does not amortize, or reduce, the $15,000 he owes you. Let’s assume the note is due in 60 months. You get $8,250 during this five-year period, and in the 61st month, you get the entire $15,000 that you originally loaned. As you can see, this is a very powerful investment, as you loaned $15,000 but you received a total of $23,250.

One final point. Maybe you are three years into receiving your $137.50 (meaning you’ve collected $4,950 in payments). Now, you decide you need a large sum of money for something – say, a vacation, home improvement, college tuition, or some other investment. You are still owed two years worth of payments at $137.50, or $3,300, and the balloon payment of $15,000. You have several great options, because you have the power of controlling a lot of money.

You can actually sell your entire note at a discount to a note investor. That’s right, there are people and companies all over the world that purchase mortgage notes (the actual payments that are due on a real estate transaction). The note you have, even though there are only two years left, would be highly attractive to an investor, because the payments are interest-only and because there is a $15,000 balloon payment due in 24 months.

Now, remember, note investors are out to make money, so they won’t offer you full price. They will either buy your remaining payments, probably for a discount of 10% to 20%, or they might purchase just the balloon payment, at the same discount, leaving you the remaining payments, or they might buy both the payments and the balloon.

So, assume you need $11,000. If you could get an investor to purchase your remaining payments and your $15,000 balloon for $12,500, I would think you’d be extremely satisfied. Remember, you’ve already made nearly $5,000 on your loan, so you’d wind up making nearly $17,000, and you don’t have to worry about collecting the payments any longer. Plus, you will get the "hot" cash that you require immediately. As you can see, financing part of the sale of a piece of property is an extremely solid investment.

These examples are just a few of the many ways to own mortgages, not property, and get rich without the headache of being a landlord. If investing in real estate notes is something you would like to try, you might want to consider starting small, like with a mobile home note. These can be very inexpensive to buy but are extremely profitable.

Mark Barnes is the author of the new novel, The League, the first work of fiction, based on fantasy football. He is also an investment real estate and home loan finance expert. Learn more about his suspense thriller at http://www.sportsnovels.com Get his free mortgage finance course at http://www.winningthemortgagegame.com

Investment Real Estate — A New Twist: Be the Bank, Not the Landlord, and Get Rich Without the Work!

When you sell your home, appraisers use comps (comparable market sales) of local properties sold within the last six months to value your home. With today’s rapidly rising seller’s market, six-month-old information is ancient history. Appraised value does not always equal the true market value, or what the home will sell for on the open market.

Realtors will give you a comparative market analysis, an informal estimate of market value based on comparable sales. Lenders, on the other hand, will use the appraised value to determine a new mortgage amount. Some lenders require that the stated property value covers the mortgage amount plus their selling costs in case of foreclosure. For this reason, a sale may fall through if a home sells on the open market for more than the appraised value, which often happens in bidding wars over hot property.

We learned the importance of securing a sufficiently high appraisal when we sold a rental property in Lake Elsinore, California. We listed the house for $234,700 on Friday. By Monday morning, we had three offers: $245,000, $255,000, and $260,000. We accepted the one for $255,000 because the buyers had $80,000 down, reassuring us that they had sufficient funds.

As usual, the lender sent an appraiser to review the property. This busy appraiser didn’t take the time to view all the upgrades we put into the custom-built home. Even worse, he used only comps from the local one-mile radius. Because this home is close to a shopping district, there were not many homes sold in this limited area during the six-month period.

The appraiser used comps six months old; during this time housing costs in Southern California appreciated around thirty percent. Sales from six months previous should have gone up in value by $30,000 on a $200,000 home. This means that our home should have been worth $250,000 to $260,000, especially since buyers are willing to pay this price on the open market. To increase the value of this home, at the time there was not another three bedroom home listed in the area for under $250,000 (excluding manufactured homes). However, the appraiser valued our home for only $230,000 — and we would have lost the sale if the offer did not include a sufficient down payment.

Because a low appraisal can kill your sale, finding a buyer with a large down payment provides you with a safety net. You may also choose a buyer with strong credit who doesn’t have to put a large percentage down. If you think that your home’s appraisal could become a problem, make sure you don’t include a clause in your sale’s contract which states “subject to appraisal.”

How to Avoid Low Appraisals

• Hire your own appraiser before the sale. Then ask your buyer’s or lender’s appraiser to review your appraisal.
• Retain the option to approve your buyer’s mortgage lender. Make sure that the buyer doesn’t use a lender with a history of deliberately underestimating property values. A good real estate agent should know which lenders routinely under value homes.
• Keep records of repairs and upgrades, including costs. Take “before” and “after” photographs. Create an organized journal with a listing of expenses and include pictures to show to the appraiser during the appraisal appointment. Stage your home for the appraiser like you do for buyers.
• Secure your own property comparables to make sure the appraiser uses complete information. Call real estate agents with homes in escrow and get the sales prices. Make a list of these properties with the agent’s phone numbers and give it to the appraiser.

What to Do When Your Selling Appraisal Comes in Too Low:

• Ask for another appraisal.
• Protest the appraisal with documentation of your upgraded expenses.
• Have the buyers make a larger down payment.

When you sell or buy real estate, remember that the certified appraisal is just one person’s opinion of the value of your home. The opinion that counts for you is the buyer’s: you want to be sure the buyer values your home above all others.

Copyright (c) 2005 Jeanette Fisher, All rights reserved.

Jeanette Fisher, author of Sell Your Home for Top Dollar–FAST, Staging Houses for Top-Dollar Sales, Doghouse to Dollhouse for Dollars: Using Design Psychology to Increase Real Estate Profits, and other real estate and interior design books, teaches Design Psychology and real estate investing seminars. For information on Design Psychology, visit: http://designpsych.com/. For help selling houses, articles, and home staging tips, see http://www.sellfast.info/.

Appraisal vs. Market Value: How to Avoid Pitfalls in the Sale of Your Home

Why without asking your boss?

Two reasons, one, he or she will most likely say no; and second, he or she will probably have you committed for asking.

So what do you do. Give the raise to yourself.

Impossible you say. Chuck and Sue are crazy. Not at all. Here’s how.

You know we love the Creative Real Estate niche of Lease Purchasing and you know we believe it to be the perfect home-based business.

But, did you know you can use these same methods in your spare time to give yourself that big raise.

Ask yourself, “What would I be willing to do to earn an extra $20,000 in a year”.

The answer may surprise you. And no, you don’t have to become a hit man (or woman) to earn this.

You just have to be willing to take a look at Lease Purchasing.

Some background before you think we’ve completely lost it.

For every 100 calls Sue makes on For Sale By Owner property, she either speaks with or leaves messages for about 60%. That’s about 60 people she puts the concept of Lease Purchasing in front of.

Out of that 60, approximately 10 will develop into true prospects. From these 10, 2 or 3 will develop into property we are willing to take on. The others may become consultations or manual sales.

(Please keep in mind, these numbers will vary a bit depending upon your particular area and current market conditions).

Gee, you say, that sounds like a lot of work. Not really. Consider making those calls over a 3 month period. That’s the equivalent of a call per day. Why a 3 month period. Because you’re only looking to do one deal a quarter.

Next question. How does this translate into a $20,000/yr. raise? Simple.

On a typical single family house, we look for a $5000 assignment fee on average. Well, let’s do the math. 4 x $5,000 = $20,000.

Yup, a $20,000 raise on 4 deals per year.

Is this realistic? Absolutely.

In fact, we may be conservative on that raise for you. You may well decide to do five or six or more deals in a year.

All it takes is knowing how to structure your deals, having the proper contracts and a willingness to want to give yourself a raise. You can find all this information at our website at: http://www.homebusinesssolutions.com/products/products.htm

You’re right. Chuck and Sue are crazy. Crazy like a fox.

Copyright 2000, DeFiore Enterprises

Interested in having your own successful, home based creative real estate investing business? Chuck and Sue have been helping folks start successful home based businesses for over 19 years, and we can help you too! To see how, visit http://www.homebusinesssolutions.com/ for the latest FREE tips and tricks, educational products and coaching in creative real estate investing and home based businesses. No time to visit the site? Subscribe to our “how to” Home Business Solutions Digest, it’s like having your own personal coach: subscribeHBS @ homebusinesssolutions .com

How To Give Yourself A $20,000/Year Raise Without Asking Your Boss

For posting the “Truth” on your website, some FSBO’s will not like you. These prospects would not have listed with you anyway. For Sale By Owners – that can receive sound advice – will appreciate your courage, celebrating by having listed their home with you.

Sometimes, the "Truth" hurts. Yet, being ripped off, raped, or even worse – hurts a whole lot more. Ask any police officer if home sellers should open their doors wide to strangers. Better yet, inquire how frequently FSBOs cry to law enforcement after being robbed, assaulted, or otherwise endangered by persons masquerading as home buyers.

Since many agents – in an attempt to appear professional – resist telling prospects the whole, atrocious truth, all too many FSBOs are not properly informed of the very real risks they are taking. In an effort to put safety of others ahead of a personal profit motive, you can rest assured that you – a true "Professional" – have done the right thing.

It is absolutely the owner’s right to sell their own home – without the assistance of a real estate agent. Yet, more often than not, the dominant marital partner says, "We can sell our home ourselves, Honey, without paying any real estate commissions. We will need those extra dollars ourselves for when we move."

No thought of the danger is realistically acknowledged.

Rather, the man says, "I’ll go get the For Sale By Owner sign. You write the ad for the newspaper. We will save thousands by selling this way!"

His compliant, even if apprehensive, companion places the advertising, is supposed to field the phone, make appointments for – supposedly interested – home buying prospects to come view the "For Sale" property. She wants to be certain that her husband is home – with her – when people come to see their home. If that is not always possible, she likely has enough of an awareness of inherent evil lurking about that she will try see to it a friend is.

Soon, the parade of the unqualified begins. These are the curious "Lookie-Lews." People arrive into the FSBO’s home, eager for their own reasons, not all of which are honorable. For thieves, it is a "Free-for-all." For shrewd real buyers, "It’s Bonanza!" Unfortunately, "Little Joe" Cartwright isn’t there to protect the homesteader’s interests.

Every year, dozens of real estate agents are abducted, robbed, raped, and murdered. The NAR

How much do you really know about investment property? Accurate research and professional expertise applied to the purchase of an investment property builds a solid foundation for financial success. You may want to work with a REALTOR who can help to identify the great opportunities in investment properties in the area of your choice. Or, you may choose to do the work on your own. A REALTOR can provide the inside line on properties with potential in the geographic area where you are looking for property. If you do choose to work with a REALTOR, you will save time, and you may have more choices and opportunities.

Research the Property’s Past and Present

Some essential information must be obtained about the property’s past. For example, do you know the history of the property, or even how old it is? What sort of upgrades have been made to the home? Is the roof waterproof, and is the plumbing and electrical in working order?

What’s the Neighborhood Like?

Once the overall condition of the property has been assessed, tax assessment records must be examined to determine property value trends. A good REALTOR will be familiar with the neighborhood where the property is located and if he or she is not, the REALTOR should check the neighborhood at different times of the day and night and speak to some neighbors. If there is a homeowners association, check the guidelines, assess fees, and be certain they allow rental of properties.

Assess the Bottom Line

For what purposes are you, the investor, going to use the property? To rent? To house your business? Or, to rehabilitate the property and sell it at a profit? Once this is determined, you can assess the bottom line.

Are you paying cash for your investment property? If not a mortgage will have to be paid. Have your REALTOR determine if rent and applicable fees will cover the mortgage, property management and maintenance. Consider property management if you do invest in property. Research fees and services provided by different property management companies, or ask your REALTOR if they provide this service, because many do. If you do not want to collect rents and contract repairs, find a property manager with the skills to negotiate, be your intermediary, and facilitate business in your absence. For investors who rehabilitate and sell buildings at a profit, a decent turnaround is 60-90 days from the time of purchase to the time the property is put back on the market. Three to four contractors should be researched and they should provide written bids with time estimates on their projects.

Document Fund Availability with Your Offer

Once you find that dream investment property, don’t forget that offers need to be accompanied by your financial institution’s statement of fund availability or a lender’s approval letter. This will help make certain your offer will be accepted over other offers that may not come with appropriate paperwork.

There are still plenty of great deals on investment properties in this real estate market, and there are some less than desirable properties as well. Do your research. Or, hire a professional who will do it correctly for you. With proper planning and decision making, your real estate investment should be a profitable and worthwhile endeavor.

About The Author

Elaine VonCannon is a REALTOR with RE/Max Capital in Williamsburg, Virginia, and she manages investment property as part of her business. Her husband Joe is a contractor who collaborates with her on rehabilitation of properties. She has helped numerous clients invest in and make money on property investments in Southeastern Virginia. Visit http://www.voncannonrealestate.com” target=”_new for listings; vonmor1 @ cox .net

How to Research and Purchase a Good Investment Property