I’ve written 5 important points that you need to be aware of when getting into real estate investing.

1. Don’t confuse an appraisal with a home inspection – you need both! An appraisal determines the worth of the property by estimating the market value of the land and building. A home inspection inspects the adequacy and condition of the building and all major systems.

2. Place conditions on your offer. Conditions provide you with the flexibility of withdrawing your offer if you are unable to obtain the necessary financing, or if the inspection reveals structural problems with the property. Even with pre-approval, Investors who make an offer without conditions do so at their own risk.

3. Understand closing costs. When buying a home, it pays to be informed about closing costs, which can represent up to three per cent of the purchase price, including: land transfer tax, lawyer’s fees, appraisal fees, title insurance and home inspection fees.

4. Have a firm strategy for a bidding war. In a competitive market, it is not uncommon for vendors to hold offers off until a particular date. This means you could be bidding for a property along with several other parties. It’s easy to get caught up in the emotion of the bidding war, so know your maximum price before you bid and stick to it!

5. Don’t do it alone – explore the benefits offered by mortgage brokers. Mortgage brokers act as a one-stop shop for planning advice and the best rates

Hans

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You may think you’ve found your dream house but what we see with
the naked eye can sometimes be deceptive.

This is why it’s important to have critical inspections done before anything goes to closing!

Your so-called “dream house” may be the money pit when all is said
and done and inspections can save you money and prevent you from
making an ill-advised investment!

Once you have a contract, it’s time to get inspections ordered and
completed in a timely manner!

Canadian Foreclosures

You’re probably just like I was when I was just starting out.
Absolutely clueless as to where to begin. What kind of inspections do you need?

Based on my experiences, I’d recommended having a termite, property and roof inspection at a minimum! Other inspections may be needed depending on individual circumstances. Different inspections could be necessary based on the property condition and location. Your real estate agent can usually help arrange whatever inspections that you or the lender may require.

I own my share of investment properties and I’ve ordered a ton of
different inspections! I’ve ordered termite, roof, property, pool,
spa, chimney, geological, well, septic, radon, lead, asbestos and
structural engineering inspections. And, in the future, I’m sure
I’ll order another type of inspection that I haven’t even thought
of!

Termite Vs. Property Inspections

These distinct inspections require different skills. The industries
are quite dissimilar. For example, termite inspectors estimate the
cost to cure Section I and II type work and usually solicit
contracts for the corrective work.

Property inspection firms don’t perform corrective work.
The purposes of termite reports and property inspection reports are
not compatible and should not be combined.

Termite Inspection

Most lenders require a termite clearance and most buyers want to
know the house they purchase is going to be free from infestation.
A termite report covers two areas of concern called “sections”.

Section I is concerned with actual termite or beetle infestation
and dry rot, caused by moisture.

Examples: Termites in joists and studs. Dry rot (spongy floor)
around the base of a toilet.

Section II concerns itself with preventive measures that could lead
to Section I type condition.

Examples: Dirt or wood in contact with wooden structures of the
house, allowing termites access. A slow plumbing leak that could
lead to dry rot.

Property Inspection

Along with termite inspections, property inspections are commonly
ordered. Property inspections differ from termite inspections in
that they concern themselves with the mechanical and structural
health of a
property.

The inspection includes a review of all major components from the
foundation to the roof, including electrical, plumbing and heating
systems.

Even if the house looks in good condition, the purpose of a
property inspection report is to evaluate the hidden components
most home buyers cannot properly judge.

Property inspectors typically are trained or have years of
experience in the construction related industries. They know what
looks right or wrong – what looks code complying – what looks
dangerous.

Having a property inspection is like taking a car to a mechanic to
check before you buy. A house investment is much larger making the
inspection more prudent.

Value of Being at Inspections

This is your opportunity to “check under the hood” of your new home inspections for the same day to utilize your time off.
Now is the best time to find where and how to turn off the “mains”
to the gas, water and electrical supply to the house in case of an
emergency.

The inspector can answer questions on the items that are addressed
in the report so you will better understand it.

I’ve had my share of experience at buying properties on the cheap,
sometimes in less than ideal condition, requiring all kinds of
inspections. I can’t tell you the number of times that inspections
have saved me from buying very troubled properties. So, don’t get
upset when this or that inspection is required, be thankful!

To Your Success!

Aiden Win

Mr. Foreclosure

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ForeclosuresTaxSales.com

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Your team of professionals becomes very important when evaluating deals in your area. Your real estate agent will be able to provide comparable properties for the investment property you are interested in.

The real estate agent will use the MLS listings to compare similar properties that have been sold in the last 6 to 12 months. Obviously the closer the comparable properties date is to the present time, it will show a more accurate reflection of current prices.

When doing a comparable lay the information out in front of you and then figure out what amenities one property has that the other properties don’t. You then add or subtract value of the amenity or lack of it.

As an example lets say we have two properties that are very similar. Both properties are the exact same in every way except one has a two car garage and the other has no garage.

The property with the garage sold 6 weeks earlier for $85,000. The other property without the garage has an asking price of $80,000. We now know that a two car garage would give the property an extra value of $5,000 and that the property without the garage is priced accurately.

Make sure you get a home inspection or a very reliable handyman to go over the property and get a preliminary title report as part of you property valuation.

Create a financial analysis of the property. Once you have established the fair market value of the property multiply that amount by 70%, then subtract your estimated costs for repairs. Your total would be the price that you would offer. Try to get a 20% profit (more is okay).

To calculate the offer price on the $80,000 property (fair market value).

$80,000 x 70% = $56,000

Now we will say that the repairs are $6000, subtract that amount from the $80,000.
For this property our offer would be $56,000-$6,000=$50,000. If you put in an offer of $50,000, your profit would be $30,000. A very nice profit.

Hans Anderson

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As an investor you should understand the procedure of how to stop a foreclosure.

Foreclosure assistance is available along with foreclosure training, if you are having difficulty in paying your property taxes do to financial problems. The government will likely place a tax lien on your property if you cannot resolve the problem. The next step that might happen is you are included on a tax foreclosure list. You need to know hot to stop foreclosure proceedings. Avoiding tax foreclosure is possible.

Before you lose your home and it becomes a tax foreclosure case, there are ways that you can resort to Avoid Foreclosure, among which are: continue reading>>.

Hans Anderson

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If you have a success story that you would like to share please feel free. If you purchased an investment property, let us know what you purchased. You don’t have to give all the financial details, just share your success with the other readers.

Use this blog to share success stories that will motivate each other. You will receive a well deserved pat on the back and the admiration of all the investors who read this blog.

Hans Anderson

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