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Real Estate Investing & The California Wildfires

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on Thursday, 26 October 2017
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Recent California wildfires have displaced thousands of residents. What help is available? How can real estate investors lend a hand?

The latest round of CA wildfires have dealt what may be one of the most catastrophic seasons on the state, with new record costs, and thousands forced from their homes. According to the state government website, 2017 has seen almost twice the average amount of acreage burned, with damage that could cost at least $1B, if not close to $5B. This includes around 8,500 residential homes which have been damaged or burned down.

The IRS has responded by extending some tax deadlines for those affected until January 31st, 2018. Victims may also be eligible for FEMA of up to $34,000 to help with funeral costs, emergency hospital bills, and housing expenses. There are also going to be a variety of agents and real estate investors looking to help house those displaced, and to offer quick sales for those who don’t want to, or can’t hang on and rebuild their homes.

A new report from UpNest shows data that suggests recent years of fires have not have much impact on the state’s property prices or demand. Yet, there are clearly many property owners who have lost everything, are still struggling to get back on track years down the line, and whose land is still badly scorched. The most immediate impact for real estate appears to be even worse lack of available housing, and rocketing rental and housing costs.

There is a huge need for fast acting real estate investors who can go in and help owners liquidate fire damaged homes, as well as for rebuilding and renovating them. Real estate wholesalers can play an urgent and much needed role in this, by finding, contracting to buy, and providing inventory to other investors who have more time and capital to reposition, remodel, and build. While fire damage and burnouts can typically be a roadblock for traditional mortgage financing, wholesalers can use Best Transaction Funding to acquire and flip these houses to cash buyers and those with flexible credit lines, that don’t rely on property inspections.

Summary

Data suggests that California housing prices are not likely to be slowed by recent fires. There is a big need for housing, and funding is available for fast flips. Wholesalers can help out by getting product in front of those with the time, money, patience to rebuild or rehab, while giving sellers the quick cash they need.

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Real Estate Financing Trends

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on Thursday, 27 April 2017
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What’s trending in the real estate financing space now?

Here’s what’s changing in the market as we roll through the second quarter, and into the second half of 2017…

Rising Loan Volumes

The Mortgage Bankers Association, analysts, and individual lenders are expecting loan volumes to rise this year. Commercial real estate loans are predicted to hit new highs in 2017 and 2018. That’s following RealtyTrac’s annual house flipping report which shows far more flippers are now using financing. Buy and hold real estate is still popular too, yet many rental property investors have most of their capital tied up in equity and will need to use leverage to expand their portfolios this year.

Higher LTV Financing

Lenders are expanding loan programs with new higher LTV options. In addition to 100% transactional funding, VA and USDA loans, private lenders and rehab lenders are also moving closer to offering 100% financing for fixing and flipping houses and small multifamily properties.

Declining Credit Score Requirements

Various efforts are being made to reduce credit scores used in underwriting. How much relief this provides to investors will depend on how front line mortgage originators adopt them. Many are still being far more stringent than the secondary market demands.

True Stated Income Loans

Alternative documentation loans have been on the fringes of the market for a while. Now we are finally seeing more lenders offer stated income loans for investors that don’t require tax returns, or even bank statements.

Equity Sharing Loans

Lenders are bullish on the market continuing to grow. More are wanting a piece of that rising equity, in addition to interest and origination fees.

JVs

Savvy investors and lenders are increasingly partnering up. This can be a great strategy for expanding, while minimizing risk, increasing diversification, and gaining access to more lucrative investments.

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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How Will New TRID Rules Affect Real Estate Wholesalers?

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on Thursday, 08 October 2015
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New TRID mortgage and closing rules threaten the biggest shake up in the industry so far. How will they affect real estate wholesalers?

A new set of rules went into effect on October 3rd, 2015. The TILA-RESPA Integrated Disclosure rules a.k.a ‘TRID’ are the most notable changes to the industry since at least Dodd-Frank. The head of the Mortgage Bankers Association warns that these new commandments of mortgage lending and real estate closings will impact everyone from loan officers to Realtors to individual home buyers and sellers. Some companies have reportedly spent millions on restructuring to be prepared. Others still may have little clue what they mean for their transactions.

There is sure to be some closing mayhem ahead. Whether these new rules and forms will really make a positive difference will have to be seen. Much of that depends on whether the rules are followed. After all, the previous issues that the Consumer Finance Protection Bureau is reportedly attempting to fix with these changes, were in reality a lack of following the rules and forms that were already in place. Unfortunately it could be the end consumer who is hurt worst as normally happens with regulatory changes like this.

TRID rules which are meant to simplify the mortgage and closing process with 2 new documents have 2,000 pages of guidelines. So no one should be surprised if there is a lot of confusion over the next few months.

The four main things you need to know are:

  1. The amount of paperwork lenders can collect upfront is being limited
  2. The old Good Faith Estimate is being replaced with the ‘Lending Estimate’
  3. The old HUD 1 Settlement Statement is being replaced with the ‘Closing Disclosure’
  4. There is now a 3 day waiting period between receiving the final Closing Disclosure and actual completion of the transaction

Real estate wholesalers can be better prepared to navigate TRID challenges by; building extra time to close into real estate contracts, requiring copies of buyers’ official loan commitments faster, making sure all parties for both transactions have their Closing Disclosures 3 days in advance, and by working with title companies that are on top of new TRID rule implementation.

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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2014 Real Estate Trends To Watch For Property Wholesalers

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on Thursday, 10 April 2014
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New 2014 real estate trends reports and forecasts pinpoint where the most active markets will be this year, what buyers really want, and who has the money to buy them…

This data is critical for real estate wholesalers who are serious about scaling their businesses in 2014 and beyond. Those wholesaling and flipping houses may work fast enough to be able to make a profit in any market cycle and anywhere. However, to go big, requires being a little more strategic.

So what 2014 real estate trends should wholesalers have an eye on?

1. Going Green

Going green is increasingly not just wanted, but clearly more profitable. In the U.S. street trees alone are reportedly adding $52M to property values. Now Fannie and Freddie are launching new green rated securities, while bigger investment firms push ‘green’ bonds.

2. Urban, Urban, Urban

It winning in real estate investment is all about “location”, in 2014 it’s all about urban locations, infill and redevelopment. Some may mistakenly allow themselves to be led into the idea the ‘burbs’ are dead for good, but there is no question downtown is the focus of the moment.

3. Mixed Use

For many reasons mixed use properties are being pushed hard from all angles. This should not be underestimated. Some may find this class more challenging, but those investors which embrace it first and find their angle stand to win big.

4. Capital Flow

If property investors thought there was a lot of money floating around over the last few years, it’s only going to get greener in 2014 and beyond. Aside from private equity jumping into the mortgage business, BestTransactionFunding.com offers virtually unlimited access to capital for fast flips and legitimate double closings. At the same time top trends reports and surveys from the urban Land Institute and PwC which surveyed over 1,000 of the most influential industry leaders, suggests capital flows are increasing with much of it flowing out of Asia. With London topped out and Hong Kong bursting you can bet the U.S. is a top pick for those seeking both yield and safety.

5. Demographic Shifts

It’s not just Generation Y driving trends into urban areas to keep in mind this year. Senior analysts also comment on aging Boomers also relocating to find warmer weather and better and more convenient health care solutions.
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A Second Chance For A Failed Real Estate Investor?

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on Monday, 08 July 2013
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Does the new housing boom create a miracle second chance for real estate investors that have flopped in the past? Is flipping houses the best chance for the kings of realty to get back on top and regain the reins to their financial futures or is it just too late?

There is No Denying the New Housing Boom

Even the most pessimistic analysts are having a hard time spinning anything negative about the U.S. housing market right now.

Check out the facts &and figures according to the National Association of Realtors (NAR) latest press release on June 20th:

· Existing home sales rose 4.2% in the 12 months to May 2013

· Median existing home sales price jumps 15.4% year-over-year to $208,000

· Buyer traffic has risen 29% in the last year

· Median days on market dropped to just 41 in May 2013

On June 2th Bloomberg ran coverage of the new Mortgage Credit Availability Index from the Mortgage Bankers Association showing U.S. home loan lenders loosening up access to mortgage loans which will only further fuel home sales.

It isn’t just existing home sales that are performing well either. The real signal that the new housing boom is officially opening its gates is new home builders like KB Homes announcing a 74% increase in revenues as of the 2nd quarter 2013.

Based on historical real estate cycles we are now entering a new boom era that will last another 10 to 15 years, during which home values will double.

10,000 Donald Trumps Looking to Rebuild an Empire

So is this new era of plenty in the U.S. residential real estate market the signal that real estate investors and investor groups should jump back into the game and flip more houses once again?

There are many, many real estate investors that completely flopped when the bubble burst. Many lost businesses, homes, expensive sports cars and even saw their families fall apart. So why did it really come to this for so many individuals and is this really their chance for a do-over?

The single biggest cause of failure among the real estate investment crowd when the bubble burst was being overleveraged. Many found themselves in negative cash flow and equity situations. Some are still recovering, others have cleared the debt and are seeing their credit scores gradually rising again.

For most the failure experienced wasn’t anything to do with personal ability, talent or a fault in the housing market. Too many just rushed in without investing in their real estate education or kept gambling on the market even though they knew an end to the run was coming.

A large percentage of this group was turned off to real estate investment and never went back, but now are green with envy as they see others banking big on distressed properties and rapidly rising values. One thing that they all recognize is that there are few if any other alternatives for regaining wealth, status and their previous lifestyles as flipping houses or building portfolios of rentals. And no one can deny if there was ever a good time to get in, this is it.

So if you are a member of this group can you bounce back and hit the big time again by investing in real estate a second time, and how can you prevent failing twice?

It’s entirely possible. Just look at Donald Trump. According to his bio on Wikipedia he once sank to a low of being $900 million in personal debt and some $3.5 billion in business debt. He certainly made a significant comeback and now boasts new developments all over the globe in addition to his stint on reality TV with the ‘Apprentice’.

Few of those reading this are anywhere near that deep in debt. So if he could do it, you can too. So how can you get back on you’re a game fast?

The Inside Scoop on the Next Real Estate Hotspot

The one thing that real estate investors who have ridden the recent housing roller coaster certainly respect is knowledge. So how can investors tap into the best data for identifying investment opportunities and targeting their marketing for maximum effective and ROI?

As predicted ‘Big Data’ has become big business in 2013. The government has recently jumped into the game amidst a variety of scandals. Bloomberg has been criticized in the New York Times for journalists’ tactics and on revelation the conglomerate owns more than 30% of the $25 billion plus financial data services market. Now real estate related firms are bulking up on acquisitions too with news of CoreLogic acquiring DataQuick for $661 million and Fidelity buying back Lender Processing Services for $2.9 billion.

Some of these firms provide valuable information to the real estate investment community, but can also drip out misinformation via faulty calculations, stale figures that do not reflect current trends or data designed to move money to their clients benefit.

So while the news can be a good barometer to keep an eye on, savvier investors will zoom in on more local data using sources like RealEstate.com’s Local Info and Market Analysis tools, as well as conducting their own market research via social media and word of mouth.

When it comes real estate marketing investors have never before been so spoilt with in depth insights for targeting and maximizing ROI on cultivating buyer and seller leads. Information giants like Verizon and Google now open the door to masses of information on consumers for enhancing marketing performance, while other companies cut to the chase and provide direct access to exclusive real estate leads.

Tips for Building Momentum Fast

While many would no doubt love to jump into investing in real estate again most can’t afford to go months without a paycheck today. So how can you get back into the game and see results fast?

5 steps to investing successfully the second time around:

1. Recognize the mistakes of the past (and put them behind you)

2. Get wired into blogs like this and other sources of good data and emerging trends

3. Start networking to build contacts and lead sources

4. Set up effective, proven systems that help avoid pitfalls and improve time management

5. Make the leap of faith and go for it

A new entrepreneur publication featured on Yahoo Finance and Reuters, G-Code Magazine, suggests that some of the best growth hacking moves small business owners and independent real estate entrepreneurs can make include taking the time to understand their customer, then engaging in guest blogging, building affiliate networks, becoming a member of local coworking office spaces and even paid search for immediate results.

Excellence = Rewards

Finally, commit to doing it right this time around; no shady short cuts, keeping eyes on the main objective and doing it for the right reasons. Real estate investment may be the fastest path to a handsome income and great wealth but it comes with so many other benefits too.

 

Commit to excellence in every area of you new venture and the rewards will come. You will build and hold a substantial legacy for your loved ones, help to improve the economy and have a direct positive impact on revitalizing communities and bringing new hope to others too.

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Where To Find More Distressed Homeowner Leads

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on Tuesday, 09 August 2011
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There are many places to find homes to flip today. You can often find deals among short sales, HUD homes and REOs. However most of the best deals are those that aren’t already listed. These are the distressed or motivated homeowners who haven’t taken action yet but need help and a way out of their homes. So where do you find them?

Credit Bureaus
You can actually get leads right from the credit bureaus with information on 30, 60 and 90 day late payments. However, legally this information is only to be shared if you are able to offer them a per-approved credit offer. So be careful if tempted to use this type of lead list.

Lead List Providers
Lead list companies and data compilers can tailor almost any combination of filters to allow you to hone in on potential leads. This can be done by LTV, mortgage amounts, lender and more. These lists are normally sold from anywhere between 2 cents to $2 dollars per name depending on the criteria you select.

Some companies you may want to check out include:

  • DMALeads.com
  • ListSource.com
  • US Data Corporation
  • Info USA


Attorneys
Probate, divorce and bankruptcy attorneys often have access to the best leads on distressed homeowners and others who want to sell quickly. They have privileged information on properties that have small or no mortgages and where the sellers are desperate to sell. Though do expect them to want to do the title work.

Title Companies
Title companies have huge databases of potential leads. They have data on when adjustable mortgages will come up for adjustment, who paid cash for their properties, who is delinquent on their taxes and they know who other cash investors are in your area who may be great prospects for flipping your properties too. Again they are going to want the title work in exchange for giving you these leads.

Loan Officers
Bank loan officers have a constant flow of leads. They take inquiries all day long from those who can’t qualify for refinances and they know who is behind on their mortgages and of course who have big bank balances too. These loan officers don’t make very much and will either be happy to exchange referrals or look for some type of referral fee.

Be sure to come back next week to read some of the best ways to capitalize on these leads....

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