Real Estate Investors Kick Away $1,000

Those new to real estate investing often fail to take action because they don't have much cash. The truth is that the very best investors got their start when they had little or no money.

When you start at the bottom you have to work harder and smarter. You have to make every penny count... and in doing so you learn how to put together the most profitable deals.

Right now one of the very best ways for newbies to get started is to buy property buy taking over the payments of an existing loan. It's called buying "subject to".

You generate income to make the mortgage payments by quickly leasing the property. Lease payments pay make the mortgage payments.

Here's something most investors overlook when buying "sub to" and why they lose around $1,000 each time they do a deal.

We often buy properties "subject to" the underlying mortgage. That simply means we give the motivated seller a little money (if he is really motivated no cash is needed) and take over the payments of the loan that's already in place.

We have title, but the seller's name stays on the mortgage loan.

This a popular way of buying property from motivated sellers. It allows the investor to buy many properties with very little cash. It also places a severe responsibility on the investor to stay current with the mortgage payments. You must be a good landlord and some the rent payments rolling in.

Here's where most investors fail to pick up that one thousand dollar that is just waiting to be claimed.

When the investor sells that property they often are not aware that they can get a check from the original lender for the cash that has accumulated in the loan's impound account.

That is the money collected monthly by the lender to pay the taxes and insurance. It often adds up to around a grand or more and it's easy to get if you know what you're doing.

When you buy a property "subject to" the underlying mortgage, always get all the owners of the property to sign a Limited Power of Attorney giving you control of anything having to do with the house in the future. That way you don't need their cooperation later, when they've left the area and can't found.

Finally, after you've held the property while it appreciated in value, you are ready to sell and cash out.

When you have found a buyer and you are arranging the close, send the lender a request that any balance in the impound account be sent to you or your company. Always send along copies of the Powers of Attorney so the lender knows you have the authority to make the request.

Sometimes they will honor your request and sometimes they won't.

More importantly, instruct the escrow officer or attorney handling the closing of your sale to ask for the impounds. They will give the pay off instructions to the lender and the lender usually will follow those instructions without question.

On a recent deal we received a check from a lender for the impounds in the amount of $1,357.00. Yeah!.. Happy dance!

Was there a catch? The check from the lender for the impound funds was made payable to the two original sellers whose names were on the loan. It looked like this...

Pay To The Order Of:
John J. Seller,
Paris W. Seller
c/o The Author's Investment Corp.

Was that trouble? No! Remember we had a separate Power of Attorney for each of these individuals. We took the check and the POAs to our bank. We explained the situation and here's what the bank officer had us do...

On the back of the check, we signed the name of each seller. After those signatures we wrote:

By_________________ (and signed our own name).

Then we signed our company name and again (By______) and then we signed our own name and position in the company.

That was it! An easy way to pocket $1,357.00 that too many investors leave on the table.

Now YOU will never walk away from that extra thousand or so dollars!

If you would like to learn more about buying "subject to" look here...

http://digbig.com/4cgpb

About The Author: Mark Walters is an investor and author. You can find his published material at http://www.CashFlowInstitute.com http://cfiblog.blogspot.com/

---

Are You Profiting From O.P.P.?

Are you profiting from O.P.P.? If not, why not? We... Read More

Real Estate Investing: America Rents

Most people in America rent a personal dwelling!Just think how... Read More

5 Rock-Solid Real Estate Investment Strategies

Investing in real estate is more complex than simply buying... Read More

Buying A Home ? Rain, Sun, and Weather Issues

When buying a home, it can be easy to overlook... Read More

Spanish Estate Agents and Inspection Visits

The only way to buy a home in Spain is... Read More

Real Estate: A Strong Investment

Description: Even in uncertain economic times like these, history shows... Read More

Secrets of Making Money from Real Estate - Part 4

Analyzing and finding the right property deals:Firstly read my other... Read More

Understanding the Escrow (Closing) Process

1. What is an escrow?Escrow is defined as a process... Read More

Selling by Owner = Saving by Owner?

According to the National Association of Realtors, For Sale By... Read More

Understanding Opportunity Cost When Investing In Property

While most investors have got involved in property investing because... Read More

Conditions Are Right For Buying The Higher Priced Home You?Ve Always Wanted

Higher interest rates and home prices in the past have... Read More

Dont Just GET THE DEED - The Infamous Kitchen Table Closing

Q: Hi Lou, I have a property under contract that... Read More

Understanding Real Estate Terminology

Purchasing a home can be a complicated and confusing process,... Read More

Investment Concerns for Selling Your Home

Besides the emotional upheaval of uprooting from your home, your... Read More

Property Investing Secrets 4

Property Investing Secrets:How to Sell to 100% of the Market... Read More

How To Create A House Buying Wish List For Your Dream Home

Buying a house is one of the most exciting things... Read More

Lease Purchasing Is The Perfect Home-Based Business

Some call it the 30 second commute. We call it... Read More

Just Give Me Eleven Reasons to Buy in Dubai

Buying overseas property is not always for the fainthearted but... Read More

How To Give Your Home A Face-Lift: The Sellers Guide To A Quick Sell

One of the great challenges to selling a home can... Read More

Real Estate, Real Property and Leased Land; Definitions, Discussion and Explanations

Delaware, and the rest of the original British Colonies, has... Read More

The Secret To Marketing Your FSBO Home For Sale

You're ready to put your home or land (house, townhouse,... Read More

Personal Branding Techniques for Real Estate Agents and Brokers

Branding can be done to any product, or any person.... Read More

Investing in the Baltic Tiger: What Has Estonia Got to Offer?

Estonia's reputation is growing within the property investment market. Rising... Read More

Why it is Important to Hire Just One Real Estate Agent to Buy a Home

In our fast paced and frantic real estate market, buying... Read More

I Already Have an MLS Listing, Why Do I Need an Internet Ad?

In today's real estate market, astute buyers are also looking... Read More

How to Make Money from the California Real Estate Gold Rush

What do the Californians know that we don't?What is so... Read More

Real Estate Investing - Makeovers vs. Flipping

Please don't call it "flipping."Some real estate investors who practice... Read More

NAHB?s Voluntary Model Green Home Building Guidelines

The voluntary Model Green Home Building Guidelines are designed to... Read More

What is a Predatory Lender?

Several months ago, the 3,000-member California Association of Mortgage Brokers... Read More

Build Your Retirement By Investing In Real Estate

Most people buy one or two properties. One is their... Read More

Mechanics Lien on Your House

In many places you can buy a house and a... Read More

Rental Property Management - Ten Questions

Why hire rental property management? Because doing it all yourself... Read More

Seller Financing - Six Safety Tips

Why offer seller financing when you sell? A higher price,... Read More