Comments for Foreclosure Investing Articles

Comment on Flipping Real Estate or Flipping Paper? by babypocket2005

babypocket2005 — Mon, 08 Mar 2010 12:02:59 +0000

This sounds like a really bad idea.

Worst case scenario - you’re on the hook for mortgage payaments and property taxes etc.

If they really want to do this then they should invest something too. Sounds like you would be risking everything (like your credit rating and financial future) and they are risking nothing. If it doesn’t work and it blows up in their face, what do they loose? Nothing! And where does that leave you?

Bad bad idea
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Comment on Why There Has Never Been a Better Time to Make a Real Estate Investment by Prince V

Prince V — Mon, 08 Mar 2010 12:00:59 +0000

First of all, now is not the time to invest in real estate.

Having said that, if you are still interested read on.

Yes, you can invest in real estate even if you are an agent. However, some agencies forbid it due to ethics and conflicts of interest.

The difference between a licensed agent and an individual is - know how (laws), connections (builders, contractors, interior designers), and experience. Savvy comes with the territory, so agents have the upper hand.

In the case of your friend, you asked, "there must be something I don’t understand." There is, he is lying!!!

The majority of agents are liars, friends or not. There are three reasons why they lie…

First, to impress others to make it seem as if they’re assets are worth more than they actually are.

The second reason an agent lies is to hide something. Weather it is mistakes or miscalculations.

The third and most common reason why agents lie is to dissuade others to go into the field.

When the market was booming, thousands of people started taking classes. Many took lessons and advice from underqualified staff. Anyway, that’s when agents bacame wary of the influx of new agents. More agents = more competition.

If I were you, do a little research on your friend. If he is giving you financial advice, check his bank statements first. See what he’s been up to. Then cross check the advice he gives you… see if it is sound. Then if you must, pull the trigger and invest!!!
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GOOD LUCK!

Comment on Flipping Real Estate or Flipping Paper? by Stefka

Stefka — Mon, 08 Mar 2010 12:00:59 +0000

If you purchase a home in your name be prepared to pay for it should the family member be unable to make a payment as you will be ulitimately responsible for the mortgage. I don’t think a reputable mortgage loan company would loan you the money for the home unless you have your name put on the deed. Make yourself the sole owner of the home so that should you need to sell it due to default on the family member, you can do so without their consent.

Personally, I wouldn’t do this as money has ruined many a family relationship.
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Comment on Why There Has Never Been a Better Time to Make a Real Estate Investment by too expensive!

too expensive! — Mon, 08 Mar 2010 11:58:59 +0000

It is not a good time to invest in real estate though…

In most area of the U.S., housing price stopped going up as inventory continues to build up. It is normal to see a correction as a boom that lasted for several years.

If you are investing new money in to real estate, this may not be a good time as the potential return on investment is small compare to the high risk of lower home price.

If you are doing a side way move, meaning you are selling one to buy another one, then it is acceptable.

Nothing is absolute, but housing market is very likely undergoing a correction and this is only the beginning. Some say this would be a soft landing (0 to 10%). Some say a big crashing is coming (10 to 20%).

http://money.cnn.com/2006/08/24/news/economy/newhomes/index.htm
http://money.cnn.com/2006/08/23/news/economy/homesales/index.htm
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Comment on Flipping Real Estate or Flipping Paper? by nc_thakaali

nc_thakaali — Mon, 08 Mar 2010 11:58:59 +0000

NEVER mix family with business, that’s a great way to destroy your credit and a lot of relationships as well. If their credit isn’t good enough for them to do what they want on their own, maybe that should tell you something….creditors don’t think they’d get their money back if they chose to lend it to them….you should take the same approach.
People make decisions every day. Obviously a new car and new house was more important than this or they wouldn’t have bought them. Let them figure it out on their own….tell them you’d have to feel comfortable making the payments should something go wrong & you don’t feel like you could at this time. They might be upset for a little while, but they’re your family they should understand that they can’t burden you for selfish reasons.
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Comment on Why There Has Never Been a Better Time to Make a Real Estate Investment by alfonso r

alfonso r — Mon, 08 Mar 2010 11:56:59 +0000

I have two brothers, that are in that bisuness. One, buys old houses, fix them and then sells them at a higher market price. Sure he invested money, but now he’s making a kill!!

The other he is a realtor. He buys property, and then he sells it. everybody needs a house. Here is Stockton, the population has been swelling due to the jobs around, the Bay Area, and San Jose.
It’s the Silicon valley!! The work over there, but live in Stockton, Even they have to drive two hrs, every day one way, then 2 more hrs., coming back!
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Comment on Flipping Real Estate or Flipping Paper? by snvffy

snvffy — Mon, 08 Mar 2010 11:56:59 +0000

Nope, don’t do it. Politely decline the offer and say that you don’t consider anything you ain’t an expert at.

Money and family don’t mix.

If they aren’t good credit risks to a lender, what would make them a good credit risk to you ??

Good Luck
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Comment on Why There Has Never Been a Better Time to Make a Real Estate Investment by ken_rph

ken_rph — Mon, 08 Mar 2010 11:54:59 +0000

In short you can do everything either way but as a real estate agent you are bound by more laws and might fall into a trap where a customer of yours says something that will make you want to buy the property and you are in a conflict of interest.

With that being said as a real estate agent you can split the commision of some deals saving you a few percent which can add up.

As for your friend not closing the deal in his name, makes no difference except he will be in more trouble if something goes wrong as it indicates he knew he was doing something wrong. Unless it is for the reason listed in the previous post but in that case he would be the owner or officer of an LLC or Corporation which means it is in his name anyway and the protection could be pierced for fraud and similar illegal activites.

If you are not planning on doing something illegal don’t worry about it.
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Comment on Flipping Real Estate or Flipping Paper? by AuntTater

AuntTater — Mon, 08 Mar 2010 11:54:59 +0000

DON’T DO IT!
Business and family don’t mix…ever.
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Comment on Why There Has Never Been a Better Time to Make a Real Estate Investment by searay092003

searay092003 — Mon, 08 Mar 2010 11:52:59 +0000

if you are a real estate agent and you buy a house that is being sold by a real estate company you can collect 2% from the sale of the house as your fee. That is one upside of being a realtor. The reason you dont want the house in your name is for insurance reasons. You need to protect yourself by forming a company and buying and selling houses under the company name. You will need to have a CPA for tax purposes unless you are capable of doing that your self. You have to keep track of all expenses everything from the cost of the house down to paint brushes and paper towels. The most important thing is turn around. Dont bother with a house that you cant sell in 1 month. If you have to make monthly payments you are losing money. You need to put the house on the market and make all repairs in 1-2 weeks and sell the house before the first payment is due in order to make a profit. There are other ways to make money on real estate such as development, rentals, leasing, leasing with option to purchase, commercial real estate. Good luck, it is one of the easiest ways for someone to make money if you end up being good at it.
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