Commercial Real Estate Investment Articles

[This article is Step One in the series “10 Steps to Subject to: Get Paid to Buy Pretty Houses in Nice Subdivisions.”]

The Real Estate Professional status is a designation given by the IRS based on the number of hours that you work in real estate activities versus other activities. It doesn’t mean that you have to become a real estate sales agent or broker. You don’t need to drive around showing people houses or putting out “for sale” signs.

Many real estate investors determine the value of an income property by using the capitalization rate, aka cap rate. It is probably the one most misused concept in real estate investing.

If you had the chance to start over again, knowing what you know now, what would you do differently the second time around? This question cuts to the core of the essential lessons of a lifetime of real estate investing. Here is my six-part answer to this question.

A compilation of the recorded documents relating to a parcel of land, from which an attorney may give an option as to the condition of title. Also known in some states as a “preliminary title report.”

This article is Step Two in the series “10 Steps to Subject to: Get Paid to Buy Pretty Houses in Nice Subdivisions.”Seems simple, doesn’t it?

I’ve seen a lot of investors miss out on huge profits because they just don’t understand how far banks will go NOT to take back a property. Banks don’t want to own real estate. Banks don’t want to have bad loans on their books. All they want is people to pay them on time and take care of the house.

It is virtually impossible to complete a successful short sale without dealing with the loss mitigation department at the bank. So, how do you deal with loss mitigation successfully? We can shed some light on that.

When you are buying a house on a lease option, you must protect yourself from paying your rent payment to the seller, but him not paying the lender.

I was speaking on financial intelligence a while back to a group of university professors in Singapore. At the end of the talk, one of the professors asked me:“Where did you learn about business and why do some people make more money than others?”

The “due on sale” clause is probably the most talked about, most feared, and most misunderstood topic in real estate investing.

A compilation of the recorded documents relating to a parcel of land, from which an attorney may give an option as to the condition of title. Also known in some states as a “preliminary title report.”

Each of us resides in at least one of the four Quadrants of the CASHFLOW Quadrant. Where we are is determined by where our main source of income comes from. Many of us rely on paychecks and are therefore employees, while others are self-employed.

This story has been a while in coming, so forgive me if I tend to be a tad bit wordy. Yes, the title wasn’t just a headline to get you to read this story. Indeed, I am totally physically blind. No, the blind are not magic people. We don’t hear better than others, have better senses of smell, or anything else the media would have you to believe. We live the same lives you live–just in the dark.

I did three lease option deals in Alabama (although I live in California) in just a few months’ time with over $70,000 in equity! Deals #1 and #2 were bank REOs that I bought through an agent. The third came from a painter I called to give me estimates for work.

I have been investing for about 30 years, so I have lots of stories about making money on rehabs. This was an interesting one. It was a four-plex in a good location, but had been owned by a law firm. They had bought it for a tax shelter, but no one wanted to deal with repairs, managing it, or showing vacancies.

I would like to share this success story because it has been six years in the making! I bought the Ron LeGrand “Wholesale/Retail” course in 2001. Prior to that I had done some “research” into flipping houses.

Like many people that have come and gone and like some that still post on the mobile home forum every now and then, I bought Deals on Wheels and Making Money with Mobile Homes over a year and a half ago. I read them once; they made a lot of sense; but they went right back onto the bookshelf.

Everyone who reads these success stories is lucky to have found a site like this to help them out. I learned most of my strategies by trial and error over the years and still don’t know them all.

“Low income” doesn’t mean “low profit…”My wife and I got into the real estate investing business with the intention of doing two things: 1.) We want to retire early and see the world, and 2.) We want to teach our 11-year-old son from an early age the value of investing wisely while working hard to achieve his goals.

In January 2008, I purchased a 1996 mobile home for $5,500. It was a bank repo that needed interior work. I sold it “as is” within two weeks for $12,500 cash.

I have been waiting a long time to tell a Success Story, but here it is! I have purchased a couple rental properties conventionally, but this was my first creative real estate deal.

This deal is a little more creative than my last deal, We Turned a We Turned a “Don’t-Wanter” into Monthly Income. But like I said before, every deal is a good deal if the price and terms are right.

Back again with another “I can’t believe that this fell into my lap!” Success Story. When we retired to Tennessee, the first property we bought was a 1949, 2-bed, 1-bath farm house on an acre within the city limits with a 600 square foot loft barn in good condition. The house was in good condition, and we thought that we wanted to make it our primary home by adding on and renovating.

I sent out 250 postcards to out-of-state property owners in one zip code. Several people called back, and this one was an old 1955 Spartan mobile home in a “55 and older” mobile home park, completely set up. The guy lived in Texas and said he had power of attorney to sell it for his dad who inherited it.