When No Money Down Real Estate Gets Really Expensive

by blogger1
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on Apr 22 in BestTransactionFunding
If no money down real estate investing still really works in 2013 is it really possible that it could wind up less appealing than strategies?

There is no denying that no money down real estate works today between transactional funding and creative deal structuring, but can it actually end up being less profitable and more expensive than putting money down?

The promise of no down payment real estate deals has drawn thousands of new investors to the housing market year after year for decades, but while it has worked well for some, others have been caught off guard by ‘deals’ that weren’t really deals at all.

So what’s the main issue?

A lot of no down real estate investment education programs and gurus hone in on seller financing as a solution for those with no cash of their own to invest and poor credit.

Owner financed property might be a great idea for first time home buyers, those now purchasing a new residence after foreclosure and even some investors but it does come with its complexities and challenges for serious investors.

Seller financing is commonly offered by slick and amateur investors and desperate homeowners. Often they want above market prices in exchange, or demand terms and fine print that make properties much more expensive; shrinking profit margins and making them difficult to resell.

There can also be problems with transparency and seller ability to commit. Sometimes they aren’t actually able to sell on the terms they agreed to knowingly or not. This requires quality due diligence to ensure seller solvency, become aware of any additional liens and potential clouds on title.

All it takes is getting stuck with one dead weight deal you can’t get rid of to begin bringing down your house of cards.

All this can be avoided by sticking to wholesaling and using private, hard money or transactional funding.

This still offers all the advantages of leveraging other people’s money and the potential for zero down payment deals, but without the complexities, risks or digging into profit margins.

So line up your funding and you’ll be able to get out there and make a lot more offers, do a lot more volume and enjoy more income, bigger payday with less stress.
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