How can I buy real estate without much cash?
I don’t have a whole lot of cash to use as a down payment. How can I stop renting and buy a place of my own in the near future? Is this even possible without signing on for a ridiculous interest rate?
You can get 100% financing and typically have the seller contribute up to 3% of the selling price of the house to your closing costs. The only requirement would be that you’d have to have $500 of your own money into the transaction. The interest rates are very comparable to 80% or less financing; there is a .5% charge 97% & 100% financing (usually an 1/8 or 1/4 more in interest rate). The tough part at the high LTV’s can be mortgage insurance. The ways around this is:
1. VA programs and paying the funding fee (good deal)
2. 80/20 loans, usually a savings in payments over MI
3. Community Mortgage programs — This is a great secret that most of us lenders have available. If you take a home buying/home owning course I have programs that I can offer that have reduced MI. The savings can be big.
How To Buy Bank Owned Real Estate
Tips you need to know to save you Money, Time and Stress when buying a Bank Owned property. Bank Owned real estate is a perfect investment for the First Time Home Buyer as well as the Real Estate Investor and Move Up Buyers. Learn how to find properties eligible for $100 down FHA Financing or to inquire about the special FHA Rehab Loan for Bank Owned properties. I can be found online at http://tucson-fha-loans.com or at http://usdaruralhomeloans.com
Duration : 0:6:21
Why Buy Real Estate?
Are you looking for an investment? Do you need a place to live? Are you trying to reduce your tax bill? Is income producing property for you? Is this the right time to buy? Are property values going up or down or staying the same? There are lots of questions but where do you get the answers? Do you talk to a realtor, accountant, lawyer, financial advisor, uncle Bill or Suze Orman?
The answers to each question will vary from person to person, depending upon each individuals current situation. Why are you considering a property purchase at this time? Your specific objectives and your situation are the primary concern. It is not important why someone else is buying, that’s their business, but what will a real estate purchase do for you? When I travel I usually rent a car for a day or week. It doesn’t make much sense to buy a car for a few days or a week, but when home it is much more convenient and cost effective to own my car and I can accomodate my tastes and prefernces for continual use. Buying or renting a car are both expenses, but with real estate you add the dimension of investment and the possiblility of appreciation.
Real Estate is a commodity much like any other commodity. Prices generally fluctuate up and down based on supply and demand fundamentals and production costs. Remember that fluctuations in supply and demand precede fluctutations in price. Prices appreciate most rapidly when demand is high and available supply is less than the demand. When supply far exceeds demand, then prices will decline. It is important to thoroughly research the market and exercise due diligence before making a purchase decision. You can usually rent a place to live, the decision to purchase should be well researched and timed to maximize your return on investment.
Real Estate is primarily local in nature. If demand is high in Las Vegas and availability is low and prices are rapidly appreciating, does not mean than the same will be true for Boston or Phoenix or even Lake Tahoe. You have to research your target market and get some historical prospective on changes in the market conditions. What is the available inventory level now versus 3 months, 6 months, 1 year or 2 years past. What have prices done during that periord? What were average marketing times for properties sold. Lots and vacant land prices, while related, do not necessarily equate with completed homes or condos. (There may be an excess of condos while a shortage of lots or homes.) This type of information can usually be obtained from a realtor but be sure that the data is statistically accurate from MLS reports or property tax recordings and not an opinion or sales pitch by the agent.
In a perfect world you would always buy low and sell high. In real estate other conditions are also important. Some buyers never plan to sell. Location, convenience or features may be more important that the investment aspects of a purchase. Whatever your situation, do your homework, understand the local market and use that knowledge to your benefit. If there is lots of inventory and you are one of very few buyers, be patient and negotiate for the best possible deal. If the inventory is tight and you are competing with other buyer’s for a property, you may have to pay a premium; just remember that it may be a while before you can turn the property.