Thursday, 15 May 2014

How To Attract Real Estate Investing Cash From Private Money ... | Real Estate Investing

How To Attract <b>Real Estate Investing</b> Cash From Private Money <b>...</b> | Real Estate Investing

How To Attract <b>Real Estate Investing</b> Cash From Private Money <b>...</b>

Posted: 11 May 2014 03:52 PM PDT

As a real estate investor, the availability to attract private money is vital for the success of your real estate investing business. By providing a website explicitly designed to attract and persuade private money lenders and potential investors that your business is the best to invest their money in is therefore mandatory.

But you must have the suitable private money investor website in order to meet this need a website that is clean, professionally designed and laid out, and most importantly, one that leaves no doubt in potential private money investors minds that their money is best invested in your business.

Finding the appropriate web site is therefore critical. Firstly, why must you have private money sources?

1) Do you like the deal? You are funded!

Can you employ regular funding for a deal with creative financing (such as taking over payments)? Even if such a deal can make you $100,000? Very fanciful!

No financial institution will lend you money unless it is a straight traditional purchase; not in my knowledge.

With a ready source of private money you can turn to in at a moments notice, you may transact all the real estate deals you can get; if you like it, you got it.

2) Close more transactions

With private money, you call the shots. As such, you can do deals that other real estate investors would not deal with simply because you have money in the bank from your private money lenders.

With private money you can close on real estate deals any time, even with time limitations. Regular banks generally take at least 30 days to finance a deal, and come with tons of under-writing conditions.

Hard money lenders lend only on real estate transactions under certain conditions (like 70% minus repairs) . With private money real estate loan conditions, such stipulations do not exist.

3) Private money is less costly

Interest charges of hard money loans are at least 16% plus points. Ordinary loan sources will not even consider any transaction unless these deals are straightforward.

4) It is not necessary to spend your own money

Hard money sources demand the first month interest as well as additional points before. Hard money lenders will not advance rehab funds, so you need a good bank balance even for a small real estate deal.

Conservative lenders will ask for counterpart funds from you, most times about 10%-20% . Private money does not have those preconditions.

Real estate investing websites for attracting private money

With a professional real estate investing private money lender website presenting you as a successful real estate investor, private money investors can trust you with their money. As a result, you can tap private money resources to finance your real estate deals others can only wish for.

You should have a private money web site specially crafted for drawing private money sources interest to back your business. Naturally, you will not wish to appear haphazard to potential private money investors and financiers.

So the website should portray you as a successful businessman and real estate investor who is knowledgeable and top notch in his field. The website portrayal should make you as a knowledgeable, professional real estate investor who is successful and a leader in his field that private money investors can count on.

The content of the private money investor website should be professionally written to persuade private money lenders that you are the best real estate investor for their cash. It should also be fully optimized for search engines.

Selecting the correct private money lender website in pursuit of this aim is hence a vital requirement for your business success.

Americans Believe <b>Real Estate</b> is BEST Long-Term <b>Investment</b> <b>...</b>

Posted: 09 May 2014 04:00 AM PDT

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HowStuffWorks "How REITs Work"

Posted: 20 Mar 2014 05:48 PM PDT

Investing in income-generating real estate can be a great way to increase your net worth. But for many people, investing in real estate, particularly commercial real estate, is simply out of reach financially. But what if you could pool your resources with other small investors and invest in large-scale commercial real estate as a group? REITs (pronounced like "treats") allow you to do just that.

REIT stands for real estate investment trust and is sometimes called "real estate stock." Essentially, REITs are corporations that own and manage a portfolio of real estate properties and mortgages. Anyone can buy shares in a publicly traded REIT. They offer the benefits of real estate ownership without the headaches or expense of being a landlord.

Investing in some types of REITs also provides the important advantages of liquidity and diversity. Unlike actual real estate property, these shares can be quickly and easily sold. And because you're investing in a portfolio of properties rather than a single building, you face less financial risk.

­REITs­ came about in 1960, when Congress decided that smaller investors should also be able to invest in large-scale, income-producing real estate. It determined that the best way to do this was the follow the model of investing in other industries -- the purchase of equity.

A company must distribute at least 90 percent of its taxable income to its shareholders each year to qualify as a REIT. Most REITs pay out 100 percent of their taxable income. In order to maintain its status as a pass-through entity, a REIT deducts these dividends from its corporate taxable income. A pass-through entity does not have to pay corporate federal or state income tax -- it passes the responsibility of paying these taxes onto its shareholders. REITs cannot pass tax losses through to investors, however.

From the 1880s to the 1930s, a similar provision was in place that allowed investors to avoid double taxation -- paying taxes on both the corporate and individual level -- because trusts were not taxed at the corporate level if income was distributed to beneficiaries. This was reversed in the 1930s, when passive investments were taxed at both the corporate level and as part of individual income tax. REIT proponents were unable to persuade legislation to overturn this decision for 30 years. Because of the high demand for real estate funds, President Eisenhower signed the 1960 real estate investment trust tax provision qualifying REITs as pass-through entities.

A corporation must meet several other requirements to qualify as a REIT and gain pass-through entity status. They must:

  • Be structured as corporation, business trust, or similar association
  • Be managed by a board of directors or trustees
  • Offer fully transferable shares
  • Have at least 100 shareholders
  • Pay dividends of at least 90 percent of the REIT's taxable income
  • Have no more than 50 percent of its shares held by five or fewer individuals during the last half of each taxable year
  • Hold at least 75 percent of total investment assets in real estate
  • Have no more than 20 percent of its assets consist of stocks in taxable REIT subsidiaries
  • Derive at least 75 percent of gross income from rents or mortgage interest

­At least 95 percent of a REIT's gross income must come from financial investments (in other words, it must pass the 95-percent income test). These include include rents, dividends, interest and capital gains. In addition, at least 75 percent of its income must come from certain real estate sources (the 75-percent income test), including rents from real property, gains from the sale or other disposition of real property, and income and gain derived from foreclosure of property.

We'll look at the different types of REITs next.

5 Things No One Told Me When Getting Started In <b>Real Estate</b> <b>...</b>

Posted: 15 May 2014 09:20 AM PDT

5 Things No One Told Me When Getting Started In Real Estate

May 15, 2014   //    5 Things No One Told Me When Getting Started In Real Estate

When I first got introduced into Real Estate, I went in with unrealistic expectations. I thought I was going to be retired in the next couple of years and was going to quit my fulltime job in no time.

The good news is… I was able to quit my full-time but…. it wasn't a walk in the park and most of the time wealth is built slowly and Real Estate is no exception. If you are thinking about getting into Real Estate Investing, here are some things you need to know.


Real Estate Is Harder Than You Think
Here's the bottom line… Real Estate Investing takes work. The infomercials late at night promise a life of riches, fame and glory with no money down and no work. To reap the rewards you have to be willing to put the work in. Now… it doesn't have to be in the form of swinging a hammer, but there is lots of time and energy that goes into putting deals together. Work hard now so that you can reap the rewards later.

Every Single Market Is Different
Before jumping into a certain area to invest, understand the market. Buying a townhouse in Barrie is different from a townhouse in Whitby. When I'm selecting my target,  I'm looking for 3 key factors. Vacancy Rates – You don't want to be the investor that has that property that can't get filled. Going to stats Canada is a great resource for this type of information. Infrastructure – Pay attention to things that are being done in the community. Will it attract new families to the area? Are they expanding or extending the Highways? Are they improving public transportation to make it more convenient. Household Income – Understand the household income in a community is important. If you are buying a higher end starter home you need to know if you can rent it out at the higher end of the scale, will there be a demand for it? Again, stats Canada is a great place to find this information. Real Estate is truly a local game.

Find a Mentor or Real Estate Club in Your Local Area
The best thing to do when you start out in this industry is to find a mentor or a real estate investing club, such as Smart Home Choice. Why make the costly mistakes in the beginning when you can learn from others mistakes? There are lots around the GTA and surrounding area and many of them will be Free or charge monthly membership fees from $20 to as high as $200 a month. I get it… I didn't want to pay these fees in the beginning either but once I did, it's the best thing I ever did. The education and the networking I continue to get from these clubs are priceless.

Don't Quit Your Fulltime Job too Quickly
This is probably this biggest mistake I see many people make in the beginning. Getting so excited that they quit their full-time jobs too quickly. Trust me, once you leave your job it's not easy to get qualified for mortgages. In many cases its can be next to impossible unless you hand over your first born. Map out the next few years, determine how many homes or joint venture partnership you need before making the move.

Treat This Like a Business NOT a Hobby
When you get your first investment property treat it like a business. Act as if you had a boss watching your every move. You can reap some HUGE rewards from Real Estate investing -so be organized. The tax man wants his share of the pie too, so make sure you file, and get yourself a good team of accountants, lawyers, real estate agents, mortgage agent… etc. Treat your business with respect and it will treat you back even better.

We value your feedbacks, let us know what you want you like or would like for us to improve on.

Until next time…. Make The Smart Choice.

Gary Hibbert
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