The good ole & # 39; days were refreshing. You could put up with a job in your yard and get paid. Times have changed.
Real estate has become competitive. In some areas, it's a sellers market. In others, buyer's take the pure. No matter what, there are many thousands more individuals in real estate now than there were back then. With investment seminars and flipping shows becoming more mainstream, the real estate pool is growing on a daily basis.
But what are you in a hurry to sell? Does that mean you are motivated? Let's take a look at what constitutes a motivated seller, and / or
- You are facing foreclosure
Times can be tough. You may have had the job and could not replace the income in time. The bank sent you a letter Lis Pendens (the beginning of a foreclosure). You are out of options, and you do not want the foreclosure to end up destroying your credit.
- You are behind on taxes
Just as before, this is an immediate situation that can destroy your credit. Taxes get collected no matter what, so bad credit does not need to be added to the mix. Back-taxes does not just want to eat up your equity, so you'll want to get attached to your future wages.
- You have bad tenants
You are constantly receiving complaints about the tenants in one of your properties. Police are becoming a normal sight in front of the property. Perhaps the renters are turning their investment into a drug. You do not want to deal with the situation and would rather take the cash out of the investment and walk away.
- You are getting divorced
Let's face it. Not many are fair in divorce proceedings. Who is keeping the house? Neither of you? So you have no choice but to sell quickly so you can avoid your soon to be like the plague, and get some cash for a fresh start.
- You are retiring
Whether you are a countrylord who is retiring from the business, or a couple with a home that you've had for years, you just want some cash for your equity so you can move to warm climates and bingo.
- You inherited real estate
You just inherited a house or multi-unit property, but would rather have cash instead. You want a quick sale, and do not want to be bothered with upkeep.
- You are out of the state owner
You thought you could manage the investment property in California while relaxing in your home in Maine. Unfortunately, good help is hard to find and the property managers all turn out to be drunk. The grass is high and you are getting letters. It's more heads than it & # 39; s worth.
- You just want some extra cash
You do not have a need for the property in question and you just want to pad your bank account.
These are all valid reasons that would make you a motivated seller. The only question in this case is … are you greedy?
Outlandish property valuations. A number one killer of real estate sales. The fair market value may be high, but nobody is biting. How is that quick sale going for you? The first step in selling your home quickly is acknowledging that you need to be open minded. If you can open minded about the price of the sale, then the selling almost will be a breeze.
Where are my target buyers?
You have quite a few options. Some want to take longer than others. Probably the number one way of selling quickly is seeking out a wholesaler. A wholesaler is a real estate investor who looks for discounted properties, wrists on offer, then assigns the contract to one of their many cash buyers. Often, the wholesaler wants to have hundreds, or even thousands of investors in their contact list who are ready to buy immediately. Their partners have been engaged in the sale of funds, and they have shown that they have closed.
There are wholesalers that buy properties in multiple states, while other wholesalers are limited to a single state. Some of them even stick to a specific city or regional area. They are known for the use of phrases as "we buy houses, any area, any condition". While many wholesalers stick to deeply discounted properties, others work with low equity deals. These are some of the techniques that you require to be an open-minded seller that is truly "motivated".
Another option for a quick sale is Craigslist and other classified websites. If you are going the classifieds route, you have to be prepared for the & # 39; tire kicker & # 39; responses. There can be a lot of newbie investors, and people are just looking at it. When listing a classified ad for your home, make sure you include as many details as possible in the ad. Leaving out the bedrooms, bathrooms, parking, and other features will take you to the multitude of calls you will receive.
If classifieds are not your thing, you want to find buyers through a more direct route. Go to where they hang out. There are forums such as EquityPaper, and BiggerPockets that have premium subscription options for real estate and other networking tools. These are forums where investors get together to discuss real estate. If you list your home in these professional member areas, or marketplaces, you can get actual quick responses from interested buyers.
Determining property value to an investor
When listing your property, there are some things that potential buyers want to know in addition to the standard property details. ARV (after repair value) is one of them. To find your ARV, go to Zillow, Trulia, and Redfin. On each of those websites, search for your property and write down the estimated value for each of them. Add all 3 of those values, then divide the sum by 3. The result will be your ARV.
After you have your ARV, you want to find out what the new buyer wants to do. If your home is in great condition, you just need to look for things like paint, appliances, and other things related to the buyer's tastes. You would multiply your square foot by $ 10 to get the total credit the buyer wants. Broken windows, doors, etc wants to be $ 20. If the house is a disaster and a complete rehab, then the multiplier is $ 30. Now subtract that number from the ARV.
Whether or not the buyer is a whosaler or a flipper, they need to make something off the deal. This can be anywhere from $ 2,000 to $ 50,000 or more depending on the location, value, and other factors for your property. Many good wholesalers want to stick to the $ 10,000 price point or close to it however. How to take advantage of ARV and subtract the buyer.
Creative financing for a fast sale
Assuming that the final number from the calculations listed above does not come close to taking care of what you owe on the property, then you need to learn to be creative. Some wholesalers and flippers want to take a property with little to no equity.
Subject 2 Financing
Subject 2 is a technique that allows new buyers to take over their mortgage payments and assume control over the property. Sub2 investors are looking for leverage so they can not pay up their credit.
A seller may have a concern when dealing with a deal. For example, what does the buyer do not pay the mortgage and does it end up as a bad credit item for the seller? Well, there are protections that are in place for sellers.
- A single late payment can be a deal breaker. It can be made in this event, the buyer is in default and they loose the property back to the seller. This single possibility is reason # 1 for being a rare scenario. Most subject 2 investors are seasoned. They've been doing it for years, and have done so.
- Limitation clauses also seeks to remunerate the property in their own name within a set period. Let's say that in 2 years time, the buyer is required to refi. By then, they will have accumulated enough equity by paying down their loan for this to be a way through traditional lending methods. Even in the worse case, they can not secure their money.
Contract for deed, or lease option
If you are not in a hurry for a bunch of cash, you can make a contract for a deed, or a lease option. This will ensure that the buyer is liable for upkeep, insurance, taxes, and everything else while giving you a monthly income stream with little risk. With either technique, you are getting a fast sale. The best part is that you retain the deed to the home until the buyer's obligations are met. If they default, you can just evict them and start again with a new buyer. The best part is that you are engaging in the sale.
FSBO does not have to be hard. It can be quite lucritive, and amazingly fast when you learn to open-minded and creative.Immobilienmakler Heidelberg Makler Heidelberg
Source by Brandon Connell