Crafting a Purchase Offer

When crafting a purchase offer, it is first important to understand the several truths of the real estate sale.

It is important that all buyers remember that Homes will generally sell at market value.

Market value is determined by what a buyer is willing to pay.

Market value is not a fixed, rigid price, but instead is a range of value.

This is because no two buyers are alike. While one must have a pool, another will consider a pool a liability.

Bottomline, you the buyer are the market.

As in many areas which are continuing to experience declining home prices, we see the "low-ball" offer becoming the leading offer (new pink) for Spring buyers.

The term low-ball (price), generally defined as the deliberate underestimation of cost or value. In real estate, the low-ball offer means an offer significantly below a seller's asking price.

In the current real estate environment, there are two distinct categories of buyers.

One includes the traditional buyer looking for a good home at a good "value" today, because today is when they are shopping.

The second is a buyer with less concerned with timing or even suitability of the property and much more concerned with value, not only in the context of value today but in terms of anticipated value tomorrow or next year.

Regardless of the category in which you fall, keep in mind that both buyers are in the market at any given time.

Unless your goal is to accumulate a scrapbook of rejected offers you will one day share with your grandchildren, it is critical to remember that you are offering to purchase a home.

A home, unlike a share of stock, a gallon of milk, or a commercial office building, is inherently emotional.

So, it is helpful to keep in mind a few dos and don'ts when creating your offer:

1. Don't offend. Unless you are offering on a property which has been held purely for investment, the seller is emotionally invested in his property.

Do not try to trash-talking the seller's shelter is not a winning strategy.

Statements like "This offer reflects the fact that the premises will require professional cleaning with a blow torch prior to possession" may just get you and your offer kicked to the curb.

2. Do get personal. Write a cover letter summarizing why you believe this is the right home for you.

On many occasions, I have seen sellers accept a lower offer because they felt a connection with the buyer.

The seller has a dog? It never hurts to mention that your own pet, who has been on Prozac since moving to your current top floor studio apartment, is (or soon will be) "digging" the large rear yard.

The seller raised his children in the home? Why not mention something about anything personal within your circumstances that may sway an acceptance, it my not help but it couldn’t hurt.

3. Don't defend your offer the wrong way. As in, by saying it is all you can afford or that you are basing it on what you believe values will be during the next lunar cycle.

This approach will likely leave the seller with the notion that there is a buyer out there, one who isn't you, who can afford his home and at the price it is worth now.

4. Do know the seller's circumstances.

Does the seller want to move or does he need to move?

Does he need to be out of Dodge by sundown, or is he just toying with the idea of relocating to the mountains if he can get "his" price ?

Circumstances will dictate whether there is a bargain on the horizon, and knowing this in advance can save everyone the aggravation of a long trip to nowhere.

5. Don't preach. Your agent has given you information on comparable property sales.

Beating the seller over the head with your 16-column spreadsheet will not endear you to him.

He has set a price, presumably after having taken this same data under consideration.

You may believe his price to be high, but it is his price. Insulting his intelligence will not further your cause.

6. Do be prepared to negotiate. No buyer wants to think they paid too much, and no seller wants to think he sold out.

Expect to go a round or two. "Take it or leave it" offers are rarely met with excitement from the seller, regardless of the price and even in this market.

In negotiations, everyone wants to feel like they were in control and that they prevailed.

7. Don't be unreasonable.

There is value, and then there is crazy-talk. If a home is offered for X, and you are willing to pay 10% less than X, do not offer X minus $1 million and then ask the seller to throw in his bedroom furniture and a pony.

You will not be taken seriously.

Today's real estate market is teeming with opportunities for the buyer. Great values, values relative to prices a year or two or more ago, are plentiful.

But, insanely great "deals" are still needles in the haystack, because market value will always be determined by what a buyer is willing to pay.

This buyer might be you, but if you are unrealistic or even simply careless with crafting your offer, it will probably be someone else. rtwb

Defer the Down Payment - No Mortgage Payment

There are endless variations of how seller financing could be arranged.

Here is one example, which could prove useful under certain circumstances.

A seller of a free and clear real estate property who needed cash down only to build trust in his real estate investor might be induced to forego rental income for a few months while the real estate investor accumulated enough to put together the required down.

It is not a common opportunity. But it has happened in the past and will happen again in the future - perhaps to you.

This technique, together with the other seven described and illustrated in this section, should stimulate creative real estate investorss to take advantage of seller flexibilities in financing.

Seller financing after all, is one of the major sources for down payment capital.

Everyone should try to obtain seller financing prior to obtaining normal bank financing.

It never hurts to ask, maybe you will get lucky.

Remember, it may take awhile for someone to agree but if they do agree with your offer, then you will have a deal come true.

Good luck with your offers.

Habits that make Millionaires

I have added this little tidbit of information as a modivation for you to focus your intentions.

Keep in mind that you must have a target and the tools (knowledge) to get you there.


According to a study of college students more than 50 percent of these young leaders expect to be millionaires within their lifetime.


What's more, 5 percent of them expect to hit the million-dollar mark while in their 20s.

Earned Money vs. Easy Money


Easy money usually comes from inheritance or luck, such as winning the lottery.


The track record of people who get their money through the lottery or other windfalls is usually very different from those who created their wealth themselves or who planned for an expected inheritance.


Lottery winners are often a sorry lot; more than 90 percent use up their winnings within 10 years -- some go through their money in weeks or months.


But there are some consistent patterns among those people who earn or plan to inherit their money, and these five strategies may be worth emulating.


1. Avoid the Earn-to-Spend Mentality


Point out that to increase wealth, it's essential to emulate millionaires who view money as something to save and invest, rather than income to spend.


Many wealthy people live quite simply, he points out, choosing less pretentious homes than they could theoretically afford and opting for financial independence over material showmanship.


2. Focus


Resisting the impulse to be scattered in your efforts and interests: "Winners focus; losers spray." And goals that are clearly written down are easier to keep in focus.


3. Do Whatever Is Necessary to Meet Your Goal


People who earn their millions are able not only to focus but persevere in the pursuit of their goals.



One single mom entrepreneur, started her first business, a health and safety consultancy, when she had a young son.


While en route to her goal of becoming a millionaire by age 35, she and her son ate lots of pizza, did homework late at night and often slept at the office.



She is now a chief executive for a global business consulting firm.


4. Take Calculated Risks


You have to take strategic risks to earn and grow money. A little rebelliousness seems to help too.


One interesting study found a majority of male millionaire entrepreneurs had been in trouble with school authorities or the police during their adolescence.


5. Be Generous


Why doesn't it surprise us that millionaires are often very generous?


Sometimes it's for the tax breaks, obviously, but often it's not. One Swiss millionaire, for instance, gave $5,000 in cash to a waiter at a Jerusalem café who foiled a Palestinian suicide bombing.



Among the most generous of millionaires are those from North America, who are, two to five times more likely to give to causes they value than their European counterparts.


These five habits are a pretty good prescription for living happily even if you're not a millionaire.
It's not so unusual to be a millionaire. As of 2004, there were 8.2 million households with a net worth of more than $1 million.


Are the folks in those households happy ? Yes.


The happiest among them, he says, seem to be "highly educated, well-paid women who have jobs."


How much money does it takes to be happy ?


"About $1 million, give or take a little."


Get Happy Now : Seek Knowledge - Stay Focussed on Target

Real Estate Strategy: "The Balloon Down Payment"

An investor in Milwaukee recently bought a small rental home for $45,000 by putting on a new first of $25,000 and having the seller "carry back" the rest (no payments, no interest) after a small down. The seller would do so only after the real estate investor agreed to pay out the indebtedness after five years.

The real estate investor of a $235,000 6-plex in Lake Worth, Florida, assumed the existing first and induced the seller to carry back the remainder of his equity after the $50,000 down payment (obtained from a partner) in the form of a second at 12%. The seller agreed, but only on the basis of a ten-year payout of the balance of the second. Both of these investors were using the technique referred to as a "balloon mortgage".

It is not uncommon for seller-financing arrangements to include provisions for a balloon payment in the future.

In fact, balloons are an important inducement to get the seller to play the part of the lender in the first place. Knowing that the major part of his equity is coming in the near future, the seller is willing to carry the financing at rates below the conventional market.

Occasionally a seller is willing to amortize the entire amount of the carry back over a long period of time - fifteen or twenty years or longer. Most of the time, however, the seller wants to be paid off sooner, in fact, as soon as possible.

That is the danger the real estate investor must beware of - short-fuse balloon notes can rob the real estate investor of health, sleep, and sometimes the real estate property itself.

In theory, the time of the balloon payment should be far enough away to take advantage of interim appreciation. real estate property values and rents must grow enough to permit a refinance solution to the balloon payment.

What if local real estate property values - particularly during a period of sustained high interest rates and sluggish real estate sales - do not grow as anticipated?

The real estate investor may be forced to sell the real estate property, or another piece of real estate in his control to pay off the balloon.

He may have to bring in an equity-participation cash- partner to bail him out, thus giving away important benefits.

The worst case, he might have to give the real estate property back to the seller and lose all his investment.

Despite the risks, the balloon payment technique can be a valuable way to get into a real estate property for little or nothing down up front.

Real estate investors should resist pressures to accept anything less than five years for payout seven years or more would be preferable.

Real Estate Contract: "Raise the Price, Lower the Terms"

Seller financing has already become a convention for real estate transactions in the decade of the 80's on.

Currently nearly two-thirds of all home sales involve contract sales or assumptions with owner carry-back second mortgages.

Tight money conditions always foster seller financing of this type.

Yet even though the concept of "seller as lender" is no longer foreign to the American way of real real estate property transfer, there are variations to the game that give creative real estate investors the advantage over the competition.

One such variation is the important technique called "Raise the Price and Lower the Terms."

Simply put, this calls for the real estate investor to offer the seller more than he is asking for the real estate property in exchange for flexibility with the terms.

For example, one investor we know of recently took an interest in a Jacksonville, Florida, estate house with adjoining triplex.

He offered to raise the sales price by $8,000 if the seller would lower the down payment requirement and accept payments over 10 years.

By using this technique, he out aced the competition and won over the seller despite the hue and cry of all the relatives in the background.

Contract - Wrap Around Mortgage Stratagy

An California investor recently bought a duplex for $68,000 by putting down $1,000 and having the seller accept a contract for the remaining $67,000, 10.75% interest for 30 years, and payout after 12.5 years.

The contract wrapped around a small underlying first mortgage.

Similarly an investor in Oakland, California acquired an $80,000 free and clear single-family house by putting a small sum down and having the seller carry back the rest in the form of a contract.

These are variations of the technique referred under various names such as "contract, wrap-around, or owner carry back".

This technique is one of the most frequently used creative finance tools.

It is the foundation of seller financing. Rather than refinancing the real estate property or formally assuming the existing mortgage.

The real estate investor uses a contract as the purchase instrument.

He does not get title to the real estate property until he has performed according to the provisions of the agreement. He says to the seller, "I'll pay your equity off in installments over time.

As soon as I have paid everything off, you will give me the deed for the real estate property, and it will be mine.

In the meantime, I will act as the owner by taking over the management and getting all the tax benefits and the appreciated equity above what the real estate property is worth at the time of purchase.

Of course, all the expenses in the meantime are mine as well."

If the real estate property is free and clear at the time of purchase, the seller pockets all the installment payments on the contract if there are existing encumbrances on the real estate property.

Then the contract is referred to as a wrap-around contract or wrap-around mortgage.

It "wraps around" the existing first and subsequent mortgages or trust deed.

When the seller receives the installment payments, he has to first make payments on the existing notes before he can pocket the rest.

The advantage to him is that the interest rate on the total wrap-around contract will be higher than on the underlying loans.

He will be making an interest spread on the underlying part of the note - not a bad deal for a seller-turned-lender.

In addition, he will be able to spread his capital gains profit out over time rather than receiving all of it during one year.

The tax advantages are considerable.

With the recent liberalization of installment sale provisions by the IRS, sellers have great leeway in how contracts are set up for maximum tax benefits.

A competent tax accountant can spell out the detail.

The advantage to the real estate investor is that he does not need to come up with a large cash down payment Frequently a moderate amount down will close the deal.

In addition, the interest rates acceptable to sellers are usually far below conventional market rates for new financing.

A contract sale is bandied by an escrow company, which holds the pre-executed deed from the seller in favor of the real estate investor until the latter satisfies the terms of the contract.

The escrow or title company will also hold a quit claim deed made out by the real estate investor in favor of the seller, which is to be released to the seller in case of default.

It is in the best interests of the real estate investor if the escrow company is also empowered to receive his installment payments and take care of making the payments on the underlying loans before disbursing the balance to the seller.

That way the real estate investor can be assured that his money winds up in the right places.

An alternative form of the "contract wrap" technique is the situation where a real estate investor takes title subject to the existing financing (agrees to take over the seller's obligations) or goes through the formal procedure of assuming the existing financing (qualification, credit checks, transfer of title).

The real estate investor then signs a contract with the seller for the equity above the existing loans and makes payments according to a mutually agreeable schedule.

The seller's equity is covered by a note secured by the real estate property itself.

The usual term for this arrangement is "owner carry back".

The term refers to the fact that the seller carries back paper to cover the unpaid equity on his real estate property.

Of course, the terms on the paper are negotiable and vary from case to case.

RT-RGA

Real Estate Strategy - Life Insurance Policy

Offering a Life Insurance Policy. . .

. . . is another strategy the real estate investor can use to persuade the seller to play lender in a transaction.

Trust between Buyer and Seller is the key to all win-win Real Estate Deals.

As seen in the case of the blanket mortgage, the key is building trust. What if you say to the still somewhat incredulous seller,

You might say to the seller,

"Since you are permitting me to pay off your equity in cash over a period of time, how would it be if I took out an insurance policy in the amount of the note and made you the beneficiary?

That way you will feel secure that the note will be paid off no matter what."

This technique is not usually necessary. But it has proven to be the nudge needed in some deals.

Again, it is an inexpensive way to build trust especially when the seller just cannot quite see it your way and needs just a bit more persuasion to agree to your offer.

The cost of such policies are usually small and the costs can be redeemed at a later time if you flip or refinance. Thus the term, "Nothing Out of Pocket" Deal sometimes called 'Nothing Down' Deal.

We all know there is no such thing as 'Nothing Down' as there are always cost involved in Closing, Transfer of Title, etc etc.

Don't get me wrong I have done a Nothing Down deal with money take out at closing, so I can say I was paid to buy the property.

(This Advanced Technique to be covered at a later time).RT-RGA

Buy Nothing Down using the Blanket Mortgage

Another Favorite Method I have used many times in the Bay Area of San Francisco.

If it works there it should work anywhere or at least most anywhere.

The key to using the seller as lender in a real estate transaction is trust.

The seller has to trust us to pay him his equity according to the terms of the agreement we work out with him.

The conventional way to "Buy" trust is to give the seller a large cash down payment that way he knows that we will not likely walk away from the real estate property.

We are going to stay around and take care of our obligations.

The seller will be able to take back the real estate property, and we will lose not only that big cash down payment but also any appreciated value above the seller's equity.

But how do we develop trust when there is little or no cash put down on the real estate property?

How does the real estate investor make the seller feel secure in such cases?

Often the real estate investor can develop personal trust with the seller simply on the basis of personal qualities and win-win attitudes.

In such cases, the equity of the subject real estate property itself is sufficient to close the deal.

In some instances, a little extra is needed to remove any suspicions on the part of the seller.

That is where the blanket mortgage comes into play.

In any Mortgage or Trust eed arrangement, there are two basic documents that are prepared.

One is a note given by the real estate investor to the seller setting forth the terms for converting the equity to cash, the other is a security agreement in which the real estate investor says to the seller . . .

"If I don't perform according to the terms of the note, then you can take back the real estate property."

In a cashless or a near cashless transaction, the security of the subject real estate property may not be enough to satisfy the seller.

The real estate investor may choose to secure the note with additional collateral - not only the subject real estate property but also additional real estate property (equity) he may have in his real estate portfolio.

The note itself stays the same, but the security agreement is changed to increase the collateral and build trust with the seller.

Naturally, the real estate investor will want to arrange to have the seller release the additional collateral as soon as the subject real estate property appreciates to a predetermined value or as soon as the real estate investor has proven himself to be dependable and prompt in making his payments.

The blanket mortgage technique is not among the most frequently used in creative finance.

The real estate investor hopes to build trust without having to tie up his other equities.

Still when a seller needs that extra bit of persuasion, the blanket mortgage technique can come in handy.

For example, one creative investor we know of recently acquired a nice four-bedroom, two and half-bath home for $85,000.

The investor put a new first on the real estate property (which was nearly free and clear) and had the sellers move their remaining equity ($45,000) to another real estate property owned by the investor.

To build trust will the sellers, the real estate investor granted them a blanket mortgage that also included his equity in another rental real estate property he owned.

Although the real estate investor did not put any of his own money into the deal (the bank provided all that was needed), he was able to persuade the sellers to agree on the basis of his neck being on the line with the blanket mortgage.

Remember there is not really any True Nothing Down but this is as close as you can get as we know there are always some expense involving Escrow, Closing and so on but that will be covered at a later time.

My favorite “Nothing Down Real Estate” Investing Methods #1

Method # I Taking Paper Out (Seller's equity is converted to paper)

A real estate investor back East was able to acquire a $47,000 4plex from a banker who not only arranged for a new low-interest first mortgage, but also carried back virtually all the remaining equity in the form of second at below-market rates.

Another real estate investor, picked up a single family home for $67,000 by putting on a new first and having the anxious seller carry back all the rest of his equity ($37,000) for five years, no payments, no interest.

Both of these investors were using the technique known as - "Taking Paper Out".

Here is how it works.

When we are talking about buying or selling a piece of real estate, we are really talking about the problem of defining and dealing with the seller's equity.

Equity as a concept is straight forward enough.

Everyone knows that it represents that portion of the value of a real estate property that is not encumbered, that belongs lock, stock, and barrel to the owner.

Equity is a fluid concept.

It can be specified only in relation to that mysterious and shifting quantity called the "Fair Market Value."

The owner has dreams about an equity to be such and such - usually an optimistically high number. The truth of the matter is market forces determine his equity by determining how much his real estate property is really worth at any specific moment in time.

The members of the "Market Value Club" - gang up on the poor old seller and say collectively, "You have a nice little place, but we've taken a vote around town, and the best we could come up with is this price I have given you in the contract to buy which is such and such."

At that moment in time, the seller's equity is defined, and the problem now becomes how to transfer to him value equal to the equity involved.

The majority of sellers, of course, will want to hold out for a selling price at the high end of the scale. They want their equity to be lot higher because they think or heard it should be higher.

No one can blame them for that but among the army of sellers in the marketplace at any given time, there are always a few - perhaps 5 percent or less - who say to themselves . . .

"We like our equity and want to keep it and derive some benefit from it, but we are very anxious to sell, so we might give up some of that equity in order to get rid of the real estate property quickly."

These "Don't-Want" sellers might be thinking - I really don't feel like discounting my equity for a quick sale, but I would be willing to wait until later for a part or all of my equity to be converted to cash."

That is the issue when it comes to "Taking Paper Out" deal. After the seller and the real estate investor have determined what equity is involved, the next step is to decide how soon the equity is to be converted.

It all boils down to a matter of patience.

The seller with infinite patience (and infinite desperation) will say, "Here's my equity, take it all and just get me out of this place."

In a case like that the selling price is equal to the liens. Such cases are rare.

The next best situation is the case in which the seller says, "Here's my equity, pay me for it when you can. Let's work out the schedule."

That is the technique referred to as - Taking Paper Out". All of the seller's equity is converted to paper before it is converted to cash.

When the buyer takes over the real estate property, he gives the seller paper for his equity and obligates himself to redeem the paper according to mutually agreeable terms.

Not all sellers will agree to an "Taking Paper Out" but creative real estate investors should always ask. You never know exactly what the seller is thinking or how anxious he really is to sell.

Perhaps only one seller in twenty will be willing to enter into a nothing down deal and of these, perhaps only one in ten will agree to an "Taking Paper Out"

That means that Method # I will show up in only one out of every 100 creative deals. But which one the first or the last one, it is never known until you get in there and ask the questions and derive the reasons for the sale and the sellers point of desperation. Yet . . .

It does happen from time to time - much to the surprise and delight of many creative real estate investors.

Try it and see for yourself. I did and it worked for me in San Francisco and Hawaii and those are top end properties which were able to put into a break even and positive cash flow conditions due to the correct structuring of the sales agreement to meet my needs as well and the sellers.

Results. Win - Win Deal.

Always the best way to go.

There will be another Method called the " Blanket Mortgage". . . coming soon to this blog.

Keep an eye open, you never know, it might be exactly what you have been looking for in your investment strategies.

RT-RGA

Finding Good Deals in this Market - RT-RGA

I think the Key to Successful Real Estate is finding motivated sellers.

When I look for Real Estate, I look for DON'T WANTER CONDITIONS.

These are conditions that create motivated sellers...(RT RGA)

D - Divorce
O - Obsolescence of property - needs major fix up
N - Negative cash flow
T - Transfer from job

W - Wrong management approach
A - Arrears in payments
N - Negative location
T - Taxes
E - Estate situations (death)
R - Retirement

C - Competition with neighboring properties
O - Out-of-area owners
N - Neurotic fears
D - Debts
I - Ignorance of investment principals and market conditions
T - Time constraints
I - Investment capital - needs capital for another investment
O - Ornery partner(s)
N - Need for status symbols
S - Sickness

These are the majority of the reasons for motivation and your goal is to find properties with sellers in these unfortunate situations. Using Win-Win Philosphy

You now become a problem solver as you attempt to solve these personal problems. Keeping in mind you are trying to offer a solution that will require little to no money down. The challenge is finding them.

There are several ways of finding good deals.

Here is some idea’s when it comes to finding deals, especially in markets like this one. Getting Good Deals In Any Market It is getting harder to find fixer properties.

Secondly, some markets are still hot . . . and some are cooling down. But fixers are still hard to find.

We are still at a point that many cash buyers have to settle for less than perfect properties. This puts upward price pressure on fixers and takes minor fix-up houses off the market. The home buyer will take on paint and paper level problems.

So secret number one in this market is . . .

Be willing to go beyond filthy houses. You will need to be willing to tackle some construction problems if you are going to find the profits you want. (Yes, deals will get better over the winter, but this is still good advice.)

To do this, you need two things:

Either you need to really know construction, or have a good property inspector you can count on. (I have been a general contractor, but I still hire an inspector now and then, and I always get a second opinion of someone in the trades.)

You will either have to hire a permanent construction person, which I have done, or develop a special relationship with one.

The third problem is here. Since real estate is hot, contractors and their subs are very busy. If you think you can get someone to show up THIS MONTH to do a small fix up job, forget it.

If they know how to use a hammer, they are working twelve hours a day now if they want.

The only other alternative is to know how to do it yourself. But that is about ten percent or less of the investors I know.

If you cannot solve those problems, you might consider just flipping (buy sell without holding) the fixers you find, and stay out of doing the repairs in the fixer market until you do. Cash is not really a problem now.

There are lots of investors to partner with. They will loan you money at high rates, or take a piece of the deal, or both.

The problem is finding the deals and getting the work done. Here are two examples to prove there are good deals still out there:

The first was a "For Sale By Owner". The owner is a contractor. It would seem a contractor would not be selling a fixer, but he lives 50 minutes away, and he has many houses under construction.

His subs figured $18,000 to fix the house. I figured $10,000 or less. He figured the value when completed at $173,000. I figured it at least $182,000. He said he would sell at $152,000 and he was firm. I got him to close at $149,000 plus some "give-me's".

Give-me's included six months of no-questions-asked financing at a very low interest rate, etc. Now that is what most people would say was the story. That is not the story. The story was that his sister had been living there for 16+ years.

He had been fighting with her over rent the entire time. She was behind. She would not pay. He would not fix. On and on. That was his motivation.

Unless and until you find the real motivation, you will be lacking the key tool to get the deal. We finished it, and the house down the street--which looks identical--is on the market for $95,000! It house recently been appraised for nearly $200,000.

The second deal was a cat infested house. You could smell the cat urine OUTSIDE the house!

That was the quickest inspection I ever did! The second time in the house I filled my nose with Vaseline or something before I went in!

It was listed for $170,000. The neighborhood was at $195,000. It was a pigpen. It would have to be gutted, dry walled, bleached etc.

My kind of deal, but I waited and made no offer at that time. It was listed, and the listing agent was a match with the owner. The owner offered for me to go around the agent at $99,000. My kind of people! I refused. But...

A month later the listing had a few days to expire, and I prepared a contract. I had $1,000. Ten brand new $100 bills. The contract called for a closing in 7 days. The proper day to present came and slam, we signed.

To be safe the contract was signed at an attorney's office. Later, someone might say she was off her rocker and did not understand what she was doing.

She was more than a little strange; the 15+ cats would be proof of that. But, she did know what she was doing. She had to quit work because of nerves.

The purchase price was $85,000. I liked that. But the real story was not the cats or the smell. That is why no one else would buy the place. That is not what is important. The reason she wanted to sell the place is because her money ran out.

Spending $20,000 for fixing the property, but sold it for $204,000. Not bad. The good deals are still out there, but if you want the big equities and big profits, you may need to roll up your sleeves.

As for myself, I have begun to start buying with the intent of holding two or three years. I may buy them in need of repairs, but in any case, I want to be positioned to wait out the economy for maximum profits.

If someone comes along and offers me too much, I just might take the cash.

Another method is a Short Sale. This is a situation where the homeowners have no equity.

The market has been softening, lenders have been very lenient on loaning to practically anyone and now we have properties going into foreclosure at an astounding rate as the market crashes.

A short sale is where you can negotiate the purchase price of the home for a fraction of the loan amount. It's a fantastic strategy especially in this market.

I will discuss more about this kind of market and foreclosures in a future article.

RT-RGA

First-Time Home Buyer Tax Credit: Q's & A's

1. What exactly does “monetizing” the tax credit mean?

The term “monetization” is defined as the act of converting something into money. In the context of the first time-home buyer tax credit, monetization means to treat the payment of the credit as if it was cash and allow its use as a payment for certain closing and down payment expenses.

2. What is a “bridge” loan?

A 'Bridge loan' is a type of loan that is intended to be outstanding for a very short time period, often only a few days or weeks. Bridge loans are use to provide funds in situations where the borrower is expected to receive funds, such as the payment of this tax credit, within a very short time.

3. What is a state housing finance agency?

A state housing finance agency, often referred to as an “HFA,” is an organization that provides funding for a variety of loan and grant activities related to for-sale and rental housing. HFAs are also typically responsible to distribute grant funds from federal agencies, such as the U.S. Department of Housing and Urban Development (HUD).

4. How do I find out if my state housing finance agency is providing this service?

The best way to locate information about your state’s HFA is via the Internet. The National Council of State Housing Agencies (NCSHA) maintains a directory of state HFAs at: http://www.ncsha.org/section.cfm/4/39/187

5. What kinds of lenders are doing this? How can I find a list of lenders who are providing these short-term loans?

Many state housing finance agencies are either running or sponsoring programs that will use a tax credit for a downpayment. These programs often place a second lien on the home as collateral to secure the eventual repayment of the tax credit funds. Some state HFAs lend directly to home buyers while other HFAs work through networks of state-approved lenders.

In addition to state agencies, FHA-approved lenders may be offering to purchase a first time home buyer’s tax credit in conjunction with an FHA-insured mortgage loan. Interested buyers should check with area lenders, home builders, or real estate agents for the names of participating lenders.

The Federal Housing Administration (FHA) also has an online tool to find FHA-approved lenders: http://www.fhaoutreach.gov/FHALookup/

6. What types of loans qualify?

Any lender could offer a program that would permit a first-time home buyer to apply the tax credit to funds needed for a loan that is obtained in conjunction with a home purchase. At this time, however, only the Federal Housing Administration (FHA) has issued guidance regarding the monetization of the first-time home buyer tax credit in conjunction with FHA-insured mortgage loans.

7. Can this short-term loan be applied to the minimum 3.5% downpayment required by my FHA loan or is it only available above and beyond the initial downpayment required?

If an FHA-approved lender or state housing finance agency is purchasing a tax credit and therefore making a short-term loan that is secured only by the repayment of the first-time home buyer tax credit, these funds cannot be applied to a downpayment in lieu of the home buyer’s funds. A home buyer still has to provide the 3.5 percent downpayment from his or her own funds.

The money from the short-term loan can be used to pay closing costs and prepaid expenses, such as escrows for taxes, insurance, and community association assessments. These funds could also be used to make a larger downpayment or to “buy down” the interest rate on the mortgage loan.

However, many HFAs are offering tax credit loan programs that offer home buyers a short-term loan backed by the anticipated tax credit and secured by a second lien, which in general will be paid off after the homebuyer receives their income tax credit from the IRS.

The proceeds of these loans may be used to satisfy the 3.5 percent downpayment requirement for FHA-insured loans. The National Council of State Housing Agencies (NCSHA) maintains a list of such tax credit loans programs at: http://www.ncsha.org/section.cfm/3/34/2920.

8. Who should I contact at my state housing finance agency to urge them to participate in this program if they don’t already do so? What should I say?

The best way to locate information about your state’s HFA is via the Internet. The National Council of State Housing Agencies (NCSHA) maintains a directory of state HFAs at: http://www.ncsha.org/section.cfm/4/39/187

Most state HFA web sites include phone numbers and email addresses by which they can be contacted.

9. Is this an interest-free loan or are there fees associated with this type of short-term loan?

If a governmental agency, such as a state housing finance agency, or an FHA-approved lender purchases a first-time home buyer tax credit, they are allowed to charge no more than 2.5 percent of amount of the credit.

10. How can I tell if the short-term loan on the tax credit is being offered by a reputable company?

If the organization is a unit of state government, it is safe to say that it is reputable. Otherwise, a home buyer may want to check with their local Better Business Bureau or through a state or local government’s department of consumer affairs.

Foreclosures Boom or Bust ?

I'm sure you are aware that foreclosures right now are exploding with interest because people are finding out it is a better, safer,and more secure way to make a living. It's no secret that foreclosures are at a 30-year high.

Why? Some may feel the economy is to blame. Still others say it could be due to unemployment. Yet others speculate that it could be the leniency in the lending business.

Whatever you choose to believe, the fact still remains that foreclosures are at record highs. This is wonderful news to the investor. This just means there are plenty to go around and several to search through so you can find that "diamond in the rough".

Most people have heard that foreclosures are or can become a great investment. So why doesn't everyone do it? Is it because it's hard? Too time consuming? Takes a lot of money?

These are all good answers, however none are correct. Through our research, we have discovered that most people just lack the motivation, desire, and knowledge.

They are stuck in what some call a "comfort zone,"satisfied with their surroundings, living from paycheck to paycheck.Foreclosures are not new by any means. During the depression, savvy real estate investors were making all the money investing in Real Estate.

They would buy houses dirt cheap, then sell them for a little more than what they paid for them. So why do the rich keep getting richer?

They know where to find the money. Foreclosure is just one of those areas. It was Robert Allen who said "More bargains are available in the area of foreclosures than in any other area of real estate."

Foreclosures to most people automatically imply the word"discount," which is great.

This is exactly what you are after. You are after properties with discounts, which means you are looking for homeowners in distress. You are looking for people in desperatecircumstances, who are motivated, who want peace rather than money.

Are there people out there like that? Absolutely...Without question! Now more than ever.

There are several reasons homeowners become delinquent on their mortgages. It could be because of a job loss, divorce, death of a spouse, illness, job transfer, economic conditions and so on.

These are all unfortunate situations, but the truth of the matter is these situations happen all the time. It's now your goal to help this homeowner get out ofthis situation. You are trying for a "Win-Win". You want to make money; they want out of their unfortunate situation. Most people have a lot of pride in their home; therefore, the biggest challenge they face is embarrassment.

They don't want their friends, family and neighbors to know they are about to lose their home. So they would rather take a loss -- "sell the home" and start over from scratch. So how do you find these homeowners in distress?

Next time I will share with you a few secrets that will help you find homeowners before all your competition.

Some Ways To Make Social Media Work For Your Business

Owning your own business is difficult enough without having to worry about finding the perfect balance of marketing strategies.

Stick solely to traditional marketing strategies and you will find yourself potentially missing an enormous demographic.

Try to milk the internet for all It is worth and you will find yourself completely overwhelmed by the number of tools and application available for internet marketing.

But what if you used social networking sites as a happy medium between traditional and hard-core internet marketing strategies?

Using this one tool could make a huge difference in your business without overwhelming you altogether. Here are 5 ways to get started using social media in your marketing strategy.

1. Create a Strategy. Your competitors have already created a strategy for using social media, so chances are you are already behind. This means thinking intentionally about how to use social media instead of randomly opening an account here and joining a group there.

Spend some time determining the kinds of sites available and evaluating what role they might have in your marketing strategy. Then make a plan to use them consistently and effectively. If you just go with the flow you will be wasting your time and effort.

2. Brand Building. Social media marketing is like having one enormous billboard advertising your company. Everything you post, every tweet you write, and every comment you make should be treated as a chance to show your audience what your business is all about, what you value, and what you stand for.

The first step to consider is creating a business blog.

Chances are you have employees who are already involved in social media in one way or another, so ask them to post some articles to the blog.

Be sure your blog includes your logo, a picture of yourself, and any other tools that will help you promote your brand.

Use your company’s colors as background on your blog and as wallpaper on your Twitter profile.

3. Choose Wisely. Do not feel like you need to use every single social media site available. Stick with a few and spend time using them to your advantage.

Choose sites that help you connect with your target demographic, that help you show off the components of your business that interest potential customers, and that will be most helpful in connecting potential customers to your business.

4. Find the Right Balance. Social media is so popular that it might initially be difficult to find the right balance between it and traditional marketing strategies. In the end, they should all work together to serve your business effectively.

Start with LinkedIn and create a business profile where you can post testimonials and make connections with your customers.

Then create a Facebook group tied to your industry or product.

Finally, use Twitter to create a village of those with interest in your industry.

Connect traditional strategies with online strategies by printing your Twitter ID on business card and make a place on your website that shows visitors where they can connect with you using social media.

5. Mobility. Many platforms allow you to communicate in real time by downloading applications to your phone.

Imagine what you could do as a business owner attending a conference. Sharing with your readers what you are learning, as you learn it, is a great way to build rapport with and interest in your customers.

Overwhelming or not, young people are exchanging information and making decisions based on social media sites.

If you are interested in connecting with them as they age, procure more discretionary income, and spend money on things that interest them, then you need to find a way to connect with them now.

And you need to make sure you are defining your business online rather than waiting for others to define you in your stead.

Get connected online and let the world know who you are.

AVOID A LEMON: KNOW WHAT TO LOOK FOR WHEN BUYING A HOME

Whether you are considering buying a house or selling one, conducting a 'rundown' of property items could make all the difference in the world.

Although not all things will require costly repairs, some might, which is why it's important to be prepared.

Before you head out to look at homes or before you put your home on the market, check out these items to ensure they are in proper working order:

Look for settlement cracks on the wall, floor, or ceiling. Every home, at one time or another, will get a settlement crack, so if you find a few, there's no need to panic.

However, if you notice major cracks, this could be a sign of structural problems. Mark down the location of where you find cracks and make sure they are pointed out to the inspector to determine the degree of damage. If they are small cracks, they can easily be filled with plaster and repainted.

Look for any leaks. If you notice any water damage marks on the walls, floors, or ceilings, this could simply be from a bathtub or toilet that might have overflowed, or, it could be serious and be due to a leaky roof or poor plumbing.

Also, check the tile in the bathrooms and kitchen for any indication of behind the wall leaks, such as mildew or loose tiles.

Open and close all the doors and windows. Listen for squeaks or sticking. In most cases, this is simply a matter of spraying some lubricant such as WD-40, but it could also be another indicator of settlement.

If there is an outside deck, check for rotted wood, which could be a sign of termites or it might just be old wood needing to be replaced.

Check all of the electrical outlets. You can simply take a working nightlight with you to plug in. This will tell you if any of the outlets are not working properly.

Check the garage doors, if applicable. Make sure they run smoothly on the track and that the openers are in good working order.

Look for pests such as termites or ants. The best place to look is around the foundation, wiring, pipes, and doors or windows.

Look at the grading of the yard, both front and back, to ensure that run-off water flows away from the house.

Look at the gutters to ensure they are properly installed and that water flows out adequately.
Check the driveway to look for crumbling concrete, pockmarks, or holes that would need to be fixed.

Have the roof looked at by a professional. Make sure the turbans are installed correctly to eliminate any leakage and that no portions of the roof need to be fixed or replaced.

Carefully check out the heating and cooling systems. These can be high dollar expenses so it's important that they are running properly. Often, these items are covered under a warranty so if there is a problem, see if you have warrant coverage is tansferrable to the new owner.

If there are any fireplaces or wood-burning stoves, make sure that the chimneys are clear of debris and that the flues are working properly.

Caulking and weather stripping are important as well. Improper coverage will cause air leaks into the home, raising utility bills and causing unwanted drafts.

The good thing is that everything can be fixed. The bad part is that some items are costly, which is why it's so important to ensure you keep operating systems of the home in good working order.

If you are buying a house, a good inspector should find all of these items and work with the seller to ensure most or all are taken care of.If you are selling your home, having these things working properly will put you in a much better position of getting a good price out of your home.

Coming Soon, Dynamic Wealth Strategies

New Dynamic Wealth Strategies on 'How To Buy Real Estate Coming soon, keep an eye out it .

FIRST TIME HOME OWNERS - MUST KNOW FACTS!

If you are interested in buying your first home, don't allow myths to dissuade you from trying.

The truth is that home prices are decreasing with the recent downturn of the economy but it is only a temporary condition and the reality is its increasing in some area's and for those area's experiencing the downturn, it will bounce back, so it is best you buy now.

It is a little more difficult for the first-time homeowner simply based on price.

However, with so many options available, that doesn't mean you can't qualify for a mortgage loan. You just need to know what to plan for and what questions to ask.

Studies show that many potential homeowners believe they can't buy a house when in fact, there is strong possibility that they can.

Close to 15% of people living in the United States state they would like to buy a home within the next few years but believe from a financial perspective, they won't be able to.

Another 10% state they can afford a home but for other reasons, probably won't buy for a while.

Here are some myths:

In order to qualify for a house, you need 20% down

Lenders are required by law to provide you with the best possible rate for your loan

You can't qualify for a house if you've been with your current employer less than five years

Your credit must be perfect

Mortgage interest is not tax deductible

The truth is these are just myths.

Now for the truth:

More and more innovative mortgage packages are being created, offering the borrowers options between 3% and 5% down. Some lenders offer zero down, if you have excellent credit.

For first-time buyers, it's in your best interest to do some serious comparison-shopping.

Every lender works with its own rates bases on their standards as well as the type of loan being considered.

Rates change literally every day so once you've made the decision to buy a house, check rates with more than one lender and check on a daily basis.

Job stability is important but the five-year rule is merely a myth.

For example, if you have worked in public relations or some other industry for 10 years but have had three jobs in that time, because you've stayed within the same business, lenders will often consider this as continuous employment, especially if you've made advancements.

In addition, solid credit and a larger down payment can compensate for work history in some instances.

It's true that credit is very important when qualifying for any loan.

However, if you have been out of a bankruptcy for two years and can provide a good letter of explanation to the lender, they will usually accept that.

If your credit is in real bad shape, consider a credit counseling service to help you get back on track. Generally, this can be done in as little as 12 to 18 months.

As you make your comparisons of the financial benefits of renting versus owning, be sure to consider tax deductions. When you buy a home, the closing costs, mortgage interest, and points are all tax deductible.

The best things a first-time homebuyer can do are conduct research and ask many questions. Remember that buying a house is never easy for anyone.

However, interest rates are currently lower than they've been since the 1960's so if you can buy a house, this is probably a great time.

With being a first-time homeowner, there are many questions you'll want to ask. It's easy to focus in on the size of the rooms, the structure, the lot, but there are other options to consider - things you need every day to live.

Here are some examples:

Public transportation - If you depend on public transportation then you need to check into what options are available in the area you are interested in looking.·

Aging parents - More and more families are taking care of elderly parents, therefore, you should think about any special needs as you start looking.

Public safety - What is the crime rate in the preferred area? How close are public services such as police, fire, and hospital? · Parking - Will there be any issues with parking? If the house you're interested in doesn't have a garage, is there ample off-street parking?

Utilities - This is an important finance to look at. Usually the seller can provide copies of the past few months for you to review, giving you an idea of what you would need to budget for.

New communities - If the area you want is in an entire new community, what recreational amenities are offered? Is there a clubhouse? Pool? Playground? Exercise facilities?

Property taxes - Some tax rules provide special benefits for veterans, elderly citizens, and even long-time residents. You should inquire what these benefits are and whom they cover.

When you get to the point of being serious about buying a house, these are the steps to follow to make the qualifying and purchase as easy as possible:

Establish good credit habits and cleanup any unfavorable reports.

You should start saving for the down payment, closing costs, and extra for any hidden expenses. Don't forget about utilities, moving expenses, and items needed for the home.

Research and read. Go to your local library and read up on as much as possible about financial management and home buying.

Start looking at various areas where you might be interested in living. Go to some open houses and do some comparison-shopping.

Meet with a reputable real estate agent and start the preliminary process.

Just remember that there is no reason to be afraid or intimidated when it comes to buying a house. The main concern expressed by couples is that they aren't sure where to begin.

There is also the fear of rejection when it's very possible that the credit situation isn't as bad as they believe.

Home buying has become increasingly easier thanks to the Internet. Years ago, people hated the one-on-one approach of determining if they qualified for a loan.

The Internet has made it so much easier where people can now go to various lenders, provide some information, and be notified online whether or not they qualify.

In addition, mortgage advice is also readily available.

Whatever questions you have can easily be asked from the privacy of your own home.

Responses are accurate, thorough, and always confidential. Contact us anytime by email : reo.asia@gmail.com for properties in California and Hawaii .

If you are interested in foreign investment we have properties located in Costa Rica and Asia.

HOW TO CHOOSE THE REALTOR THAT FITS YOU BEST

Finding the ideal Realtor doesn't just happen by accident. It takes some research on your part.

An important rule of thumb is to shop for the Realtor first, the house second.

First, you want to talk with several Realtors from several companies to learn about the different options they offer. If you aren't completely satisfied with what one has to offer, talk to another.

The important thing is that you want a Realtor who will represent you to get the best home for the best money if buying, and if selling, provide a smooth transaction for the best offer.

One proven method for finding a qualified agent is by using referrals. If you have a friend or family member who recently had a positive experience while shopping for a house or selling their home, get the realtor's name and number.

However, even if you meet with a referred Realtor, you should make sure that Realtor is right for you.

Keep in mind that the real estate market has two very distinguished sides - the buyer's side and the seller's side. If you are selling your home, you are represented by a listing agent while if buying, you are represented by a selling agent, also known as a buyer's agent.

The selling agent seldom lists a lot of homes and focuses primarily on people buying homes.

These real estate agents are the ones that sell homes on the Multiple Listing Service (MLS), by the listing agent.

In most cases, an agent is on one side or the other, although some do split their time between the selling and buying sides.

One question is what happens if you find the perfect Realtor to help you buy your home. They have the same focus and priorities as you, they are very professional, and exactly what you've been looking for.

Great! Now what happens if this Realtor has a house for sale - the ideal house - everything you want? The bottom line is, this Realtor is working for the seller of that home to ensure the seller gets the best deal. Should you use this Realtor or find another one?

Unfortunately, this situation sets up the potential for a conflict of interest. Since the Realtor is under contract with the homeowner, they have an agreement to use their negotiating skills in selling the home. This can be done, but it's a little tricky.

If you should run into this situation, the agent would become more like a transaction facilitator than that of an agent and could work on behalf of both parties, however, this is not the ideal situation and should be considered carefully to ensure both seller and buyer, get the best representation.

Keep in mind that even when you find the "perfect" Realtor, there can, and will, be challenges.

Very seldom does the sell or purchase of a home go flawlessly. So be prepared to be met with obstacles and be patient as the Realtor works them out.

WHAT YOU SHOULD EXPECT FROM YOUR REALTOR

Working with a reputable Realtor is a huge advantage. Unfortunately, there have been many horror stories of first-time homebuyers being promised the greatest deal ever only to discover that the "Realtor" isn't even licensed or qualified to sell homes.

Although many people are successful in finding the perfect home on their own, most aren't. A qualified Realtor knows and understands the industry and therefore knows how to negotiate the best deal for you.

Their role goes beyond just helping the buyer find a nice home. They also act as a "sanity check" to ensure right decisions are being made and things are in order before, during, and after the deal.

Realtor's areas of expertise include:

Advertising

The Realtor can advertise properties if you're selling your home, for the buyer, the Realtor can show you listings on the Multiple Listing Service (MLS) as well as other media.

Marketing Strategies
Based on accurate information and specific properties, a Realtor will create marketing strategies.

Open Houses or Home Tours
The Realtor will hold a minimum of one, possible two open houses.

Recommendations
Throughout the process, the Realtor should be open to making recommendations and offering information.

Documentation
This covers the negotiations, contract, handling appraisals, closings, etc.

Keep in mind that when you decide to work with a Realtor, you aren't just working with one, you're working with thousands. Realtors network together, which strengthens the position of both seller and buyer. If you're buying a home, you won't just be looking at houses being handled by your Realtor, but the whole network of Realtors, thus increasing your odds of finding exactly what you want at the price you need.

A good Realtor will help you in setting up appointments with lenders as well as meet you at the appointment. They can offer great expertise in this area and will be a huge assistance. Once you locate your home, your Realtor can help you locate housekeepers, gardeners, and babysitters. Their work doesn't stop as soon as the closing is done. Good Realtors will remain in contact with you over the years should you ever decide to sell.

Additionally, below are some important guidelines you should follow when selecting your real estate agent:

Talk with your friends, neighbors, and co-workers who recently sold in your area. Whom did they work with, and were they happy? Would they use this agent or company again?

Go to open houses in your area and observe the listing agents. Do you like the way they are marketing the house? How knowledgeable are they about the house and the market? Are you comfortable with the answers they have to your questions? Are you impressed with their professionalism?

Take note of SOLD signs in your area. This is a sure indication of an active, successful agent.
Interview at least three agents. Try to find out as much about each as possible. Because you will be working closely together, you want to be absolutely certain that you are comfortable with your agent's style of doing business.

Here are some very important questions to ask your agent

1. What are your qualifications, experience, and education?
2. How long have you been selling real estate? How long in this area?
3. What is your track record? How many houses have you sold in the last three months? Will you supply three references from these sales?
4. How will you find buyers for my house? May I see a marketing proposal? Are you connected to a relocation network?
5. What if I'm not satisfied with your service?
Make sure you ask these questions to ensure you are working with a good agent.

DO YOU NEED A REALTOR ? - THE TRUTH !

You are selling your home, and you want to get the best price you can to maximize your profit.

Do you need a Realtor?

Can't you sell it yourself and save on the commission?

It's best to have an agent on your side who will coach you through the process, be your advocate in negotiations, advise you on preparing your home for sale - and provide access to the most powerful home-selling tool of all.

That tool is the database of homes for sale, locally called the MLS.

You can find property or even have your own property listed on the MLS through a Realtor.

What's an MLS? When you hire a Realtor to sell your house you sign a contract to sell the home, and your home is "listed." Locally, most of these are exclusive arrangements, meaning the sale of the home will result in the Realtor getting paid.

A multiple listing service (MLS) is what it sounds like - a collection of thousands of listings in one database. The service allows Realtors to see what's available throughout a region. Moreover, such Internet sites as Realtor.com offer nationwide listings, exploding the power of the MLS.

How can a sign in your yard and some ads in the newspaper compare with thousands of Realtors seeing your house in that database?

How are all the potential buyers working with buyer's agents going to find out about your house?
Today's market is very hot, and it does favor sellers because of the low number of listings and the large number of sales each month.

So you might be able sell on your own, but for how much and after how long?

The advantage of the MLS is exposure. By letting a large number of people know about your home, you are more likely to get a good price for it in a reasonable amount of time.

But is it worth 6 percent? Sellers pay the entire 6 percent or 7 percent commission on the sale of a home, which consumes $12,000 of the profit on the sale of a $200,000 home. So, is it worth it?
Well, what if you didn't sell the house at all? You might try in vain month after month to sell, and miss out on that great home you wanted to move up into, just so you could save a bit.

Worse yet, you might buy that perfect house assuming you would sell yours soon and wind up paying two mortgages for awhile.

Many gotcha's could surface after the sale without a Realtor's and Escrow Company's support and assistance.

Who Pays the Commission?

Besides, the commission is really paid by the buyer. How can that be possible? It winds up in the seller's column on the settlement sheet, but buyers pay commissions in a certain sense.

Consider this: An automotive manufacturer sells cars to dealers, who then sell them to consumers. Consumers pay for the car, plus they pay the dealer. The dealer's profit is built into the price listed on the window. This practice is so common, we don't think we are paying the cost of the car plus the dealer's profit. We just consider the price vs. the value of the vehicle and, after a little negotiating, pay for it.

In a similar way, the 6 percent or 7 percent commission is really built into the price of the home. Because Realtors' fees are such standard practice, a 6 percent commission probably was included in the price of your house when you bought it 10 years ago. Now you are selling it, probably for a fair bit more, and that 6 percent is still built into the home's value and price. And it is the buyer who pays that price, which includes the Realtor's fee.

Finally, if you want to sell your home quickly, safely and for a good price, nothing beats listing it with a Realtor.

Contact reo.asia@gmail.com for information regarding properties in Costa Rica, Vietnam, Hawaii, and California.

ARE YOU MAKING THE RIGHT DOWN PAYMENT?

Okay, you're getting ready to look at houses to buy.

You have a pretty good idea what price range you need to look in, but what about the down payment?

How much will you need to be prepared to put down and what should you put down?

The standard in buying a house is between 5% and 10% down payment. For example, if you were looking to buy a$100,000 house with 5% down, which would be $5,000, the remaining$95,000 would be financed with a mortgage company. Let's say you have owned that house for one year and the property appreciates in value by 10%, making it's value at $110,000. What that means is that you have gained $10,000 on your initial investment of $5,000. That is considered high-leverage and is a great return on borrowed money.

However, with any investment, especially real estate, profits can go up and down. Going with this same example of a $100,000 house and a 10% down payment, if the value of the house goes down in that first year by $10,000, you now own a house worth $90,000, meaning you have lost 100% of your investment. Just remember, that if value does go down, there are several factors that can just as easily bring it right back up.

The more you put down, the less money will be financed in your mortgage, meaning your monthly payment will be lowered. If you can put more down, the better. However, not everyone is in that position so rather than putting yourself in a tight financial situation each month, you might consider waiting another year to save a little more.

Remember, if your down payment is minimal, the choice of loan problems will be limited. In addition, if you are using a gift as your down payment, there are other limitations, and if you need the lender or seller to help cover some or all of the closing costs, there will be even further limitations. Finally, if you plan on using money from your 401-K or retirement plan, there will be different loan programs and rules.

In addition, be sure you account for all your expenses. Whether you buy a new or used home, there will be expenses once you move in. For new homes, there are appliances, draperies, and for used homes, there are usually repairs. When deciding the amount to use toward a down payment, just keep in mind that you should have a little tucked away for those other expenses.

If you aren't sure about which direction to go, you can always take some time to meet with a loan officer or financial consultant to determine how much of a down payment is best for your specific situation.

Interesting Facts about Vietnam

Vietnam Introduction

Capital: Hanoi

Total Population: 85,140,000

Annual growth rate: 1.2%

Density: 275 inhabitant/km²

Urban population: 27.4%

Population of main cities excluding suburbs: Thanh Pho Ho Chi Minh City (5,200,000); Hanoi (2,100,000); HaiPhong City (825,000); Danang City (670,000).

Ethnic Origins: There are more than 54 ethnic minorities throughout the country, but the Kinh are purveyors of the dominant culture. Most ethnic minorities, such as the Muong, a closely related ethnic of the Kinh, are found mostly in the highlands covering two-thirds of the territory.
The Hoa (ethnic Chinese) and Khmer Krom are mainly lowlanders. The largest ethnic minority groups include the Hmong, Dao, Tay, Thai, and Nung.

Official Language: Vietnamese

Other languages spoken: English, French and Chinese are also spoken.

Business language: Vietnamese, then English and Chinese. French, Japanese and Korean are also spoken.

Religion: Buddhists 85%, Christians 8%, Others 7%.

Legislators favor lifting of housing limits for Viet Kieu

Many National Assembly deputies feel every overseas Vietnamese citizen, has the right to own more than one home in Vietnam and deserve rights to their houses that equal that of local residents.

The debate continued Tuesday over draft amendments to the Housing Law and Land Law that could expand house ownership rights in Vietnam for overseas Vietnamese.

Several deputies said the right of overseas Vietnamese to buy houses should not be limited, so that an open environment for property trading is created and that there is equality between them and local residents.

“We suggest that the National Assembly (NA) considers allowing overseas Vietnamese to have the same rights as locals when it comes to buying houses,” said deputy Pham Xuan Thuong.

Thuong said the nation’s constitution and Citizenship Law states that every Vietnamese citizen living abroad but holding Vietnamese citizenship deserves the same rights and shares the same responsibilities as local residents.

Tran Thi Dung, meanwhile, said the expansion will contribute to improving the investment environment, and encourage Vietnamese expatriates to return home and serve the cause of nation building.

The current Housing Law, which took effect in 2006, allows only certain categories of Viet Kieu to own houses.

These include: individuals with permanent resident status in Vietnam; those doing long-term business in Vietnam; those recognized as contributing to national development; scientists and cultural experts wanting to conduct research in Vietnam for national development; or individuals who have resided in Vietnam for 6 months or more.

The draft amendment broadens the categories to allow any Viet Kieu with Vietnamese citizenship to buy houses here. It would also grant home ownership privileges to overseas Vietnamese currently working in Vietnam with special skills deemed necessary to meet domestic demand; those that currently have a Vietnamese visa exemption and permission to reside in Vietnam for 3 months or more; or those having a Vietnamese spouse currently living and owning a house here.

Ngo Duc Manh, vice chairman of the NA’s Committee for External Affairs, said many Vietnamese expatriates want to maintain strong links with their homeland and that allowing more Viet Kieu to buy houses in the country will facilitate their doing business in the homeland.

“If we recognize three million Vietnamese expatriates, especially those holding Vietnamese citizenship, as an integral part of our demography, we cannot discriminate against them,” said delegate Nguyen Ngoc Dao from Hanoi. “We have no right to limit anything, including the scope and number of beneficiaries, and house ownership rights.”

Some deputies also said the right of overseas Vietnamese to buy homes could create an open environment for property trading.

According to the draft amendments, overseas Vietnamese have the right to lease or authorize others to manage the house, and the land it stands on. However, they are not allowed to use the house as financial contribution or as a valued property in other deals.

Tran Du Lich proposed that Viet Kieu be granted the right to get compensation if the state revokes their land, while Tran Van Tan said Viet Kieu who own houses in Vietnam should be allowed to use the houses as collateral in deals under local laws.

VIETNAM VISA EXTENSION / RENEWAL

If you are in Vietnam or intending a trip, you will require a visa for entry.

If you have a visa and want to change the visa type or extend a visa, please contact : reo.asia@gmail.com

1 month Tourist Visa
3 months Single and Multiple Visa ( extend and renew) Business
6 month Single and Multiple Visa ( extend and renew) Business
1 year Single and Multiple Visa ( extend and renew) Business
Resident Visa available *

Processing time:
· It usually takes 1 week to get the approved visa code depending on visa type tourist / business.

Price:
· Each kind of visa varies in price depending on time allotted and type.

* Restriction may apply

Key Property, Ben Tre city, Vietnam available

Divorce forces sale of large lot in key location. Ben Tre, Thi Xa Vietnam.

Lot is located on paved road which will be expanded to a blvd which will connect to the nearly constructed bridge which interlinks the city of Saigon to Ben Tre.

One of the last choice properties* available in this area and for sure no way to lose, it is only an inflationary investment.

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* some restrictions may apply

New From Costa Rica. Views and more

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Reply to: REO.ASIA@gmail.com

Date: 2009-04-16

Surround yourself with the wonderful Mountain views and sunsets of Grecia, Grecia is a blooming market in Costa Rica and it is still affordable, it is a fast growing town and everyday Americains, Canadians and Europeans discover this great part of Costa Rica. Therefor you can consider your purchase as a safe investment.

This is a 3 bedroom, 2 bathroom home, nice kitchen, living room ,dinning room, garage and patio. The property is 2475.72sq feet or 230 sq meters including construction, it is a very lovely Costa Rican style home, it is for sell by owner and would like to see it go to someone who will love it as much as we did.

Grecia is less than two hours away from the beach, it has shops, movie theaters, great weather, restaurants, banks, a hospital and peace... and it's the cleanest town in Costa Rica with very low crime levels.

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