Let me explain. By picking up a house for “Free” I mean we bought a house with no money down and no mortgage liability.

It is in Sullivan County, NY. It appraised at $240,000 in May of 2005!

I know, a quarter of a million dollar house in New York, for free?

Don’t believe me? (See http://MotivatedSellersOnline.com/PL37182)

Here is how we did it and you can too!

The trick is to find someone with a pressing personal and/or financial problem that can be solved by getting rid of their property, a motivated seller, in other words. Example?

I once picked up a house in Coral Gables, Florida, from a man who needed to get rid of it as soon as possible as it was keeping him from relocating to Phoenix, Arizona to be near his mother whose health was rapidly deteriorating.

He had his house under contract 3 months earlier, but his buyer did not qualify for the mortgage and the deal fell through.

He frantically tried to sell the house, lowering the price twice, but could not come down any further because he had refinanced the house to help his mother pay for her treatment.

He felt trapped by his house. Fortunately, he saw our ad on the Internet and contacted us.

We arranged to take over the payments on his $175,000 mortgage. He wasn’t concerned with the $18,000 equity; he realized that by the time he finished lowering the price to get a sale, he would have lost most of what was left to realtor and closing costs anyway.

The key was that we were able to act quickly without having to get a mortgage.

He gladly turned the deed over to me for no money. The mortgage stayed in his name. We turned around and the next month took a $5,500 finder’s fee from a new buyer who was able to refinance the mortgage and got most of his money back!

In the New York deal, a young woman with two children realized that she could not afford to keep her house a year after it was awarded to her in her divorce.

She had struggled valiantly for that year, unfortunately going through most of her savings to pay the $1,800 per month mortgage, including taxes and insurance on top of all her other bills. It was just too much.

She tried to sell the house, but the broker told her that to be able to sell at the Fair Market Value of $260,000, would probably take at least 60-90 days, as the market was slowing.

She desperately did not want to squander another 5 grand or more of her savings as her oldest girl was already in high school and would need the money for college.

She saw our ad and contacted us. Her mortgage was only $205,000, but she wanted out, quickly, even more than she wanted to try to save her equity, although we told her we would give her some money when we sold.

We took over the house, as you saw; a 4 bedroom, 2 bath farm house with a 1 bed, 1 bath studio and garage. It is near skiing, Hunter Mountain and White Lake, a wonderful summer resort.

We are currently negotiating a deal that should give us $20-$25,000 cash, from which we will give the former owner $5,000.

We will then generate about $200/Mo positive cash flow by bumping up the rate on the owner’s mortgage for a few years until the new owner refinances on a lease/purchase.

Why would he pay a higher interest rate, you ask? Because he is getting in with no bank qualifying! He is a Motivated Buyer!

So, you see it can be done. How can you do it?

Run ads saying that you will take over someone’s house payments. When they contact you, sign a contract with them to buy the house if you like it.

Keep it or find someone to buy your contract for a finder’s fee. If you plan to keep it or sell on a lease purchase, you must put the house in a land trust to allow the sale. Check with your lawyer.

With the slowdown in housing appreciation and the impending blowup of payment on millions of interest only mortgages over the next few years, there should be more than enough of these trapped homeowners needing help for everyone!

Copyright, 2006, Bill Young. Bill is a former bank mortgage officer and licensed financial planner. He has been investing in real estate since 1980, and writes and lectures on various real estate subjects such as Land Trusts, Foreclosures and Tax Liens. You can sign up for his Free investment course here: http://301url.com/REProfit If you want to buy property with no bank qualifying, visit: http://SellerFinanceCenter.com

Posted by admin as The Real Estate Brokers Way at 8:00 PM CDT

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A mortgage is a financial investment which involves a large amount of money, and it is important for you to do your research before deciding which company you want to go with. While many mortgage professionals are honest, they are looking for a large commission in helping you obtain a loan, and will often look out for the best interests of their job rather than you. Because of this it is important to take the steps necessary to insure you get the best possible deal.

How Is Your Credit?

The first thing you should do before applying for a mortgage loan is to review your credit report. Errors on your credit history can lead to an increase on the interest rate and cost of the mortgage. This is something you want to avoid. It is also important to understand the terms used in the agreement.

Which Type Of Mortgage?

You should know what type of mortgage you are applying for and how it fits in with your financial goals. Do you want a mortgage with an interest rate which fluctuates, or would you rather have one that is fixed?

Which Mortgage Company?

This is one of the questions you will need to answer when choosing which mortgage company you want to use. You should also know how much money you need to borrow and how much you can afford to pay each month. If there are certain things you don’t understand, you should consult a professional. There are many counseling services which are available to assist you. Like any financial expense which involves large amounts of money, you should shop around to find the best service.

Adding Up All The Costs

Many different companies will have a variety of different closing costs and interest rates. Your goal should be to find the company which offers the best service for the lowest price. Some lenders will try to estimate the cost of the closing, and this is something you don’t want. You want the exact prices, not estimates. If the company can’t give you the exact cost of all the fees up front, it would probably best for you to take your business some place else.

You Can Always Walk Away

It is also important to make sure you aren’t pressured into signing any agreements. Be wary of any lenders who try to get you to borrow more money than you need. If they try to pressure into getting the loan, this generally means they are more concerned with making money than helping you get the best mortgage. Companies like this should be avoided. If you don’t understand certain terms of the agreement, ask that a copy be made of it so that it can be reviewed with a lawyer before choosing to sign it.

Honesty Is The Only Way

Never put false information on your loan application, even if the loan officer urges you to do so. Loan officers who do this should be reported to the FTC. It is also a good idea to avoid purchasing credit insurance which is not necessary. If you feel that you need insurance, contact other companies other than your lender to see what deals they offer. At the closing you should make sure you carefully read the document before signing it. Don’t let anyone rush you into signing it without reading.

If you find that the terms of the agreement have changed, you should have not problem terminating the deal. You don’t want to sign a document which will put you in a financial strain later on. A mortgage is one of the most important parts of your personal finance, and you can’t afford to deal with a unethical lender. Making a mistake when choosing a mortgage can lead to years of financial headaches if you work with a lender who doesn’t have your best interests in mind.

Joseph Kenny writes for the UK Loan Store, visit them here, Personal Loans Store and more information on home loans available on site.

Posted by admin as The Real Estate Brokers Way at 7:11 PM CDT

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Buying your home is one of the largest investments you will ever make. It costs a lot of money to buy a home, and even more if you have a mortgage.

But there are ways to limit how much a mortgage will cost you.

1. Fifteen-year mortgages are your best buy

Fixed-rate mortgages are your safest bet when taking out a mortgage. With a fixed interest rate, you will always know what your monthly payment will be. There are no surprises down the road. Your payment will not change. If interest rates drop significantly, you can refinance to a lower rate mortgage if having a lower rate makes up for the closing costs and extension of the loan term. But with an adjustable rate, you take the risk that rates will go up and your payments will increase.

Most consumers still take out the traditional 30-year mortgage. It seems fairly affordable and is what most banks right off the bat when it comes to fixed rates. Let’s look at how the numbers break down:

$250,000 mortgage at 7% for 30 years = $1,663 monthly payment
Total interest you pay over 30 years = $348,772
Total amount paid = $598,772 (interest plus principal)

$250,000 mortgage at 7% for 15 years = $2,247 monthly payment ($584/month more)
Total interest you pay over 15 years = $154,473

Interest savings on a 15-year versus 30-year mortgage = $194,299

When it comes to the long term costs of your mortgage, the 15-year mortgage is the best buy. But for many homeowners just starting out, the almost $600 difference can be a lot when it comes to making ends meet. You have several options. You can choose a less expensive home and consider moving up when you can afford it, in around 10 years. You could do the in-between and ask for a 20-year mortgage, which doesn’t save as much, but every little bit counts. Or you could take out the 30-year mortgage and make extra payments to it with every bit of extra money you have. Personally, we have a 20-year mortgage but we are paying it off like a 12-year. We’ve never missed our goal of putting extra money to the payment, but we know if things get tight, we have a low enough payment to scrape by if necessary.

2. Putting extra money towards your principal

Putting extra money towards your principal with every payment you make is a wise decision. Even if it is only $100 extra, you are saving a lot of money in the long run. Plus, you will own your property much sooner.

Let’s look at the numbers:

$250,000 mortgage at 7% for 30 years = $1,663 monthly payment
$100 extra per month reduces mortgage term by almost five years
Total interest you pay over 30 years = $291,992
Total amount paid = $541,992 (interest plus principal)

Interest savings on a 30-year mortgage with a $100 per month additional principal payment = $56,780

3. Borrow less and payback less

Okay, that makes a lot of sense. If you are able to put more down on your mortgage, you will save a lot in the long run. I know it is hard to save for a downpayment, but it is worth it. I believe that if you are really frugal, you can save a substantial amount of money for the things that you really want.

Or you could just buy a less expensive property. If you did that and saved the difference, by the time you have the mortgage paid off, you would have quite a nest egg saved up.

Let’s look at the numbers:

$150,000 mortgage at 7% for 30 years = $997 monthly payment

Total amount paid - $358,920 (interest plus principal)

$250,000 mortgage at 7% for 30 years = $1,663 monthly payment

Total amount paid - $598,680 (interest plus principal)

You save $239,750 by having $100,000 less in a mortgage.

When you look at buying a home, look at not only the monthly payment, but at the total cost of the mortgage. There are ways to cut how much your mortgage costs you over the years. Think of how much you can save and invest in other ways.

Martin Lukac, represents http://www.RateEmpire.com, a finance web-company specializing in real estate/mortgage market. We specialize in daily updates, rate predictions, mortgage rates and more. Find low home loan mortgage interest rates from hundreds of mortgage companies! Visit http://www.RateEmpire.com today

Posted by admin as The Real Estate Brokers Way at 1:49 AM CDT

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So you don’t have enough financial strength but would still like to own your own home? There’s no need to worry. The government provides loan schemes that do not require you to produce too many documents and do not question your monetary background too much. These are called FHA loans.

But before we go into details and how you can avail of this plan, let’s ask first: What are FHA loans?

Defining FHA loans

An acronym for Federal Housing Administration loan, an FHA loan is a loan based on an insurance program that enables you to buy a home with a downpayment of as low as 3%. It is important to note, though, that FHA loans are not exactly home loans. If ever you fail to pay it off, your creditor will get compensated by the insurance fund where your loan was set.

FHA loans are best for first-time home buyers and people who are part of the minority sector. This is because when such loans were introduced in 1934, what the US government had in mind was creating a program that would satisfy the housing dreams of many Americans whose financial backgrounds do not easily qualify them for regular loans. Housing conditions in the country have improved since then.

Tracking the Numbers

Of course, while FHA loans make it easier for Americans to own their own houses, it still requires a certain level of qualification. To know if you can afford FHA loans and to calculate how much you can borrow, you need to compute your maximium PITI, or housing costs. Your PITI is determined by combining your property tax, mortgage principal, insurance and interest and multiplying this by 29%. (Most FHA loans require that your housing costs do not exceed 29% of your gross earnings a month.)

So, if your monthly gross earnings is US$3000, your PITI is US$1015.

In addition, your total monthly expenses should not go beyond 41% of your gross monthly earnings. Total monthly costs is determined by adding PITI and long term debts (like other loans and credit card balances).

Therefore, if your monthly income is US$3500, your total expenses for the same month should be US$1435 or lower. If you want to find out the maximum amount you should be paying monthly for long term debt, simply subtract your PITI from your monthly expenses. In this case, US$1435 minus US$1015 equals US$420.

Regular home loans usually accept only those whose PITI’s are under 26% to 28% of gross monthly earnings and those with total monthly expenses that are under 33% to 36%.

Comparing the two schemes, you can say that FHA loans are rather lenient.

The Process

To get approved for FHA loans, you need to have a sound credit history and enough income to ensure that you will be able to meet your payment deadlines. Once you close a loan, your creditor will ask you to place a 2% to 3% downpayment on the price of your chosen home. This will be used to cover charges like homeowners’ insurance, title insurance, title search, loan origination fees and FHA insurance fund fees, among others.

If you are only able to place a downpayment of less than 20%, your creditor will also ask you to pay a fee for private mortgage insurance.

In summary, when you think about it, FHA loans have been significant contributions to the growth of American society. It has allowed more people to own their own houses through less stressful loan programs. This is why US citizens are among the world’s best housed.

Posted by admin as The Real Estate Brokers Way at 4:21 AM CDT

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There are a number of factors that determine how much you monthly mortgage payment will be. These factors include: the amount you borrow, the duration of the loan, the amount of your down payment, points you paid, the closing costs you paid, and the state of your credit.

Your loan amount is the main factor involved in determining the repayment amount. Obviously the more you borrow, the higher your payment will be; however, the amount you borrow could impact the interest rate you pay. If you borrow above the conforming loan limit regulated by the government you will pay a premium interest rate to the lender.

The duration of the loan also affects the payment amount. Mortgages with shorter term lengths come with lower interest rates. The lower the duration of the mortgage the less risk there is for the lender. Mortgages with longer term lengths come with higher interest rates due to increased risk.

The down payment you make affects your mortgage payment amount by reducing the principal balance and affecting the interest rate. Points paid at closing also reduce the interest rate; points are pre-paid interest paid at closing in exchange for a lower interest rate. Other factors that affect the monthly payment include the closing costs. If you take a “no closing cost” deal you are actually financing the closing costs in the form of a higher interest rate. Higher interest rates translate to higher monthly payments.

The state of your credit will affect your payment amount by influencing the interest rate you receive. Your credit history along with your debt to income ratio is used by the lender to determine the interest rate you will qualify for. If you have good credit you will receive a better interest rate and a lower monthly payment.

To learn more about factors that affect your mortgage and how to save money, sign up for a free mortgage guidebook.

To get your free mortgage guidebook visit RefiAdvisor.com using the link below.

Tucson Mortgage Refinance

Louie Latour has twenty years of experience in the mortgage industry as a mortgage broker. He is the owner of Mortgages Refinance Advisor, a mortgage help site devoted to saving homeowners money with a free guidebook “Mortgage Refinance: What You Need to Know.”

Sign up for your free guide today at: http://www.refiadvisor.com

Posted by admin as The Real Estate Brokers Way at 12:29 PM CDT

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Home ownership requires funds, to begin with. If you don’t have the total funds to immediately pay for the property up front, there are other instruments available to you, and one of these is a loan you could apply for with a commercial bank.

Mortgages are based on income-to-payables ratio and, as such, there must be no major disruptions in the figures you had in your initial computation throughout the lifetime of the loan. The bottom-line figure could increase, but should not get smaller. A safe margin must always be present in there for your own protection. Many mortgages were forfeited in their tracks by sheer default of payment, and that would be disastrous for you. The unsympathetic lending bank doesn’t even ask why this happened to you, of all people — it will just go ahead and foreclose your property and, maybe, even invite a sheriff to help you haul your appliances and furniture for you.

What are the factors that could make you default in payment? More common is when, for some unforeseen and unprovoked reason, you lose your job to the nephew of your boss, or some similiar situation like that. That would be a major setback. It is advisable that when you are committed to a big loan, like this one you use to purchase your own home, you try to keep your job or, better still, work toward a promotion with a corresponding increase in your take-home pay. When this latter happens to be granted to you, then you would be blessed with some unforeseen and, therefore, unbudgeted funds and you may be well-advised to use this funds to pay a hefty amount off the principal loan; this would render you in good faith with the lending back and diminishing interest will sometimes be applied to the diminishing balance of your loan.

Another factor that could make you default in payment would be when you incur a new debt on top of the yet-unpaid one for your house. Don’t even doubt that this mistake could happen. For example, you find a nice, red Porsche that would nicely match the color of the external paint of your new house and would fit snugly into its garage. Wouldn’t that be just stylish? Surely, your boss would like your taste and, maybe, would give you that big promotion to assist you in the payment of your loan for all these things. And then, again, maybe not — then, where will that leave you?

Inquire about owner financing; it is a more convenient payment scheme for you. Remember that home ownership is a thing for the responsible person; if you are not that person who can take a responsibility seriously, then don’t even think of going into a loan to start the project. Foreclosure of loan by default in payment does not speak well of a person.

Brian Shelton makes home
buying in the Dallas easy! Visit http://www.StopRentingDFW.com/

Posted by admin as The Real Estate Brokers Way at 5:02 AM CDT

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Consider these parameters for a real estate deal:

Property Value: $250,000
Purchase Price: $160,000
Repairs: $2,500

If you analyze the numbers, you see that the equity available in this deal is $87,500 (Property Value minus Purchase Price minus Repairs).

So here’s a hypothetical question for you: Assuming that the information above is accurate, and the property is located in an area that you view as acceptable and/or favorable, then:

If I offered to give you this deal in exchange for $10,000 in cash, would you do it?

Remember - this is hypothetical. The real question here is this:

Would you exchange $10,000 in cash for $87,500 in equity?

For most savvy investors, the answer is: Absolutely YES!

This is called “Wholesale Real Estate Investing” - the process of buying a lot of equity at a very significant discount from another real estate investor who has already done the hard work of finding a deal and getting it under contract.

Just think about that - consider how easy real estate investing would be for you if you had a network of real estate investors in your area (and maybe even all over the country) who, several times each month, offered you the opportunity to purchase significant amounts of equity for a severe discount…

…It would be quite easy to become wealthy, fairly quickly, wouldn’t it?

The answer again, is: Absolutely Yes, it will.

It is through smart “wholesale real estate investing” that you can increase your net worth by $20,000 to $100,000 on every real estate deal that you do.

…Now the burning question becomes, “Where exactly do I find these wholesale real estate investing deals?”

I know of at least 3 solid sources…

You’ve got to admit - it will be a pretty wonderful thing when you know how to find great real estates deals in which you can trade a small amount of cash for a large amount of equity without even having to find the deals yourself…

…And that’s exactly what “wholesale real estate investing” is all about.

So let’s get right to it. Here are 3 places to find wholesale
real estate deals:

1.) Visit the local real estate investing club in your area.
Almost all of these clubs have networking opportunities to work with other investors who wholesale deals regularly, and this is an easy way to find great opportunities.

2.) Watch for ads in the newspaper, television, and in other media that advertise slogans like, “We Buy Houses”, or “Sell Your House in 9 Days” or anything similar to that. Most of the time, these people are real estate investors, and they are happy to wholesale deals to people like you.

3.) Watch your email-inbox. Why? Because if and when you choose to enroll in various free e-courses online, such as that via tm-RealEstateInvesting.com, you’ll be provided with automatic notification about great local and national deals as they become available. But be forewarned - you’ve got to act quickly whenever these deals are announced, because obviously the response is always significant.

Happy Hunting!

Alain Diza is an Ex-Enron survivor turned real estate investor who, through the careful mentorship of real estate ‘gurus’ Bryan Ellis, Omar Periu, and Robert Shemin, catapulted to rapid financial success. He continually creates multiple income streams with his unique marriage of Real Estate Investing and Internet Marketing.

To see a sample of his strategies in action, go to Alain’s private website at:
http://www.tm-RealEstateInvesting.com

Posted by admin as The Real Estate Brokers Way at 2:21 PM CDT

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Many of us tend to form a relationship with our bank even in these times of big banks. This does not mean, however, you should look to your personal bank for a mortgage.

It is a common misconception for people to assume that their bank will give them the best mortgage. It is a natural thing to assume, especially since people have often been banking with the same institution for many years and they feel comfortable with them. However, the fact is that if you limit yourself to going directly to your bank and getting a mortgage from them without looking elsewhere you are most likely shooting yourself in the foot. You are restricting the possibility of other options that might be better for you and this is never a good thing.

There is no doubt that your own bank might give you the plan you want. There is a chance that they will give you a good offer that would be tough to beat by any considerable margin elsewhere. However, this is just a chance. You will only know if it’s anything more than a chance by actually looking elsewhere. Sure, the comfortable and trust factors weigh in, and these can be major factors since you want to trust the institution that is giving you such a large amount of money for such an important thing, but there are many other trustworthy lenders out there that may have a better offer for you. Keep in mind that your bank will probably sell your mortgage to another lender within the first year.

The first place to go is to other major banks and lending companies which you know of. By going to these first, you are going to major companies which are trustworthy. Most major banks offer fairly similar rates, but it is still worth it to check around. In fact, you would be crazy not to check around. You may get yourself a quarter or half a percentage point off, which might seem small but can actually turn out to saving you thousands of dollars in interest payments. These other banks might also have other incentives or better options that you will want to consider. If you own a business, they may even offer you a better deal in an attempt to pick up that business.

There are plenty of other lending companies you can check with, both major and minor, online and offline. It is to your benefit to check as many as possible and not settle with your own bank just because they are the first place you check. Getting a mortgage is a huge thing and it is important to get the right mortgage plan for you, and this will only be done properly if you evaluate your options.

Posted by admin as The Real Estate Brokers Way at 2:16 PM CDT

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