Creative short term real estate investing also requires flexibility. Often, you will be required to literally sell the idea of creative real estate investing before you actually are able to begin the transaction. For example, many of my colleagues who are presently looking for properties to buy, sell or flip are constantly discussing ways of working with motivated sellers in a way that will make the process faster. This is not usually because the actual process is all that time consuming, but because the seller themselves has trouble coming to terms or conceptualizing the process.

If you want to be successful at creative short term real estate investing, then you need to be good at two facets of the deal. You must be able to convince the seller that it is a good idea without devoting weeks or months to the process. One great way to get an idea of how to explain creative financing integral to short term real estate investing, such as buying subject-to or using seller financing, is to read home study courses or ebooks about the process. The same explanations that the writers use to show the readers that these courses of action are viable and profitable will often help you make the process more clear to a seller, though you will need to tailor your explanation of benefits to that seller’s specific situation.

Once you have a good “sell” on the process, you need to have a good contract. Probably the best way to get a solid short term real estate investing contract is to hire a real estate attorney for a few hours and tell them exactly what you want and need out of the contract. They can then create a document that you will be able to use time and again that is tailored to your specific requirements. Of course, these contracts are also for sale from many “gurus” and real estate experts. However, I would generally prefer the peace of mind that comes from knowing that my contracts were written to my specifications, just for me so that I can use them for precisely the types of deals that I do best.

Once you have mastered the explanations necessary for creative short term real estate investing and you have a contract that meets your needs, it is just up to you to go out there and find those deals. These days, even realtors are offering deals clearly in real estate investor’s terms, so if you like short sales, for example, then just go out there and start by looking for properties labeled “short sale.” Then, use your knowledge and ability to find a way to make that deal happen.

However, it may surprise you to find out that good credit really is not all that crucial to your success as a real estate investor – and this is particularly true when it comes to short term real estate investing. Now, do not get me wrong. If you take out a loan, you should pay it. Period. You should never default on your word. However, it is a fact of life that even the best credit scores suffer in the real estate investing business simply because qualifying for multiple loans hurts your score – even if you pay them on time and in full. And in today’s economy, people’s credit scores are hurting for more reasons than just their loan applications.

If you have a less-than-perfect credit score, you may think that real estate investing is not an option for you. However, there have never been more opportunities for successful short-term investing than now, and in many cases, your credit will not be an issue at all. Here are a few ways to invest in real estate short-term without factoring in your credit score:

• Flip contracts rather than properties
  Probably the shortest term real estate investing option is to flip contracts. Many real estate investors charge a flat or percentage-based fee for deals. They set them up using a contract that is only binding if they locate a buyer with the ability to make the purchase. Then, the initial investor sells the contract to the investor who will actually be buying the property. A real estate investor with a good list of contacts can easily make good money flipping contracts, and their credit never enters the picture because they are not making the purchase themselves.
• Look for creative financing options
  Because it is so difficult to get a loan these days – and even people who can still have to come up with a 20 percent down payment – more and more sellers are offering seller-financing, subject-to deals and lease-options. In many of these transactions, your ability to pay far outweighs your official score indicating your likelihood of paying. There are a lot of sellers who still will want to see your credit, but in these cases, questionable credit does not equate to the end of the deal.
• Be a business partner
  Many people who would like to invest in real estate do not because they simply do not have the time. Several of my very successful colleagues actually got started from the “dead-broke” level with terrible credit by partnering up with an investor who had the means and the inclination, but simply lacked the time to be involved in short-term real estate investing, which yields big rewards but sometimes requires periods of concentrated effort.

If you are interested in short term real estate investing, your credit score should not be a major factor in your decision to get involved. Your ability to spot good deals and turn them into profitable transactions will enable you to successfully invest short term whether your credit record is spotless or in need of a good “wax and polish.”

So let’s take a minute to accentuate the positive.

I’ve seen a lot of successes in long-term real estate investing, and one of the reasons that this is one of my favorite strategies is because in a lot of ways, it’s hard to really “lose” when you get involved in this type of real estate. Here is my favorite success scenario:

You decide to invest in some real estate for the long term. You evaluate a number of properties, and eventually settle on one that appears to have a lot of potential in terms of location, flexible use and design. At first, you focus on finding some tenants for the property so that you can get that bill off your desk – after all, why pay the mortgage yourself when someone else will thank you for letting them pay it for you? Once you find some good tenants, you install them in the property and start putting the money you are saving by renting the house to them away in case of emergencies. This is stage one of winning in long-term real estate investing.

Over the years, you track the progress of your investment. Your tenants come and go, and eventually you hit a spell where you have trouble finding tenants for your property. (Don’t worry, this happens to everyone every once in a while, and that is why you saved up some money while they were in there!). Since the property is empty anyway, you take the opportunity to check out local values of competing real estate and spot some small things that you could do to update the property and make it more attractive. You make these adjustments – and take the economic benefits that come with them thanks to incentives provided by the local government – and soon find a new tenant at a higher rental rate. You attract that tenant with a lease-option transaction, but, as often happens, the tenant ultimately decides to move out after 3 years instead of make the purchase. So you still have the property – just like you wanted – and it has been well-maintained because that tenant looked at the house as his own.

Finally, after about 20 years, you think the time has come to sell. You picked a good area with good schools, and it is easy to find a buyer because the property has been well-maintained and has a number of desirable amenities and eco-friendly adjustments that keep the utilities down. You sell, and take your money happily to the bank.

As you can see, that scenario had the potential for trouble any number of places. However, with careful planning you avoided all of those problems and ultimately walked away a winner with money in your pocket. Thanks to the duration of long-term real estate investments, this is one of the best areas in which to be creative and flexible, and there were always multiple options available to you because you picked a good property to work with and prepared for the best and the worst. As you can see, comprehensive planning yields win nearly every time.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

When it comes to long-term real estate investing, the worst-case scenario is generally agreed to be that the property did not appreciate or that you cannot exit ownership of the property when you are ready. I think you will agree that both of these scenarios sound pretty bleak. However, there are several ways to plan for them to make sure that you come out on top.

We have already spent a fair amount of time discussing how to creatively exit long-term investments, so we will not address that further in this article. Instead, let’s discuss some other ways that you can plan and prepare for the worst:

• Plan for the worst when you are renting out the property
  Try to set a rental rate that not only covers basic expenses, but that will allow you to put a small amount back every month into a “security blanket” account. Ideally, this account will remain untouched for years, and it should not be part of your general emergency fund. Putting as little as 25 or 50 dollars into this untouchable account for years will help you establish an emergency fund to use for upgrades, marketing or simple maintenance in the event that you are not able – or not willing – to sell the property when you planned to.
• Set some low expectations
  You probably don’t hear that from your mentor very often, and do not get carried away with this advice right now, either! All I mean is that you need to determine not only the ideal scenario for how much you want to make off your property, but also the least that you can live with. Be pessimistic for just a minute, and determine what amount of money would enable you to accomplish whatever goals you had for the property or yourself when you bought it. If times get dire, remember this amount when you are negotiating a sale, and use it if necessary to help you make the decision to sell even if the situation is not ideal.
• Do your investigating ahead of time.
  While you own the property, do biannual (or more frequent) checks to make sure that you are still using the property in a way that generates maximum wealth. Not only will this help you maximize your investment, but it will also help keep you abreast of changes in the status of the property when it comes to zoning and other issues that could be red flags signaling you to get out early before disaster strikes.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

It is a common story these days:

A real estate investor bought a property 10 or more years ago, planning to sell it for a big profit when they got a little older and were ready to retire. Now, they want to sell, but find that the property has a market value of literally half – or less – than what they paid for it. They are stuck in a quandary, because they want to sell and get the cash out of it, but they are taking an enormous loss. Even worse, in many cases these properties are not selling at all, so you cannot get the cash even if you are willing to take the loss.

Even in Atlanta, where most investors report that the housing market has not been hit quite as hard as in other areas, we’re seeing neighborhoods where the houses were valued well over 200,000 just a year or two ago, and now the properties are selling for 60 or 70 thousand. While this is great news for buyers, it’s obviously killing the comps and property values are plummeting.

So what to do if you have a long-term investment that you just can’t get out of right now? Do you just keep making the payments and hoping something will change?

Absolutely not. You have a lot of options. You just have to know how to use them. Here are a few of my favorite success scenarios from people who thought they were “stuck” in a long-term investment:

• Maria offered owner-financing on her home and sold it for triple the market value to a couple who loved the location but couldn’t get financing and were happy to get the home at the appraised value even though the interest rate was about 8 percent, thanks to their lousy credit. Maria didn’t want to service the loan, so she sold it to a note-buyer for a percentage of the value and walked away with nearly double what she could have hoped for if she waited for a conventional buyer.
• Doug did some minor renovations on his own time (painting, changing fixtures, and general polishing and dusting), then rented out the property to a new tenant with a family using a lease-option transaction. In three years, if the tenants have made all their payments on time, Doug will give them the option to buy at his price point using owner-financing and a portion of the past 36 months’ rent as the down payment, or they can try to finance the loan on their own using more conventional methods. Doug now has great tenants that will make the property more attractive if they do not decide to buy, and he has a pretty good shot at keeping the property well-kept, occupied and generating cash for the next 3 years.
• Lonnie checked out the tax codes with his accountant and discovered that his home was eligible for all sorts of tax breaks if he made some fairly minor changes to the windows and doors. He’s keeping the property now because it is such a great tax deduction, and he was able to raise the rent he was asking significantly because the utilities are so much less.

Of course, these are just a few of the options that you have with a long-term real estate investment when it looks like you have no options. As we’ve discussed before, it’s all about flexibility and thinking creatively.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

When you start thinking about real estate investing and retirement, the first thing to do is consult your attorney and a financial advisor. In most cases, if you work for a company that offers retirement plans, buying real estate will not be included in those plans. As a result, you will need to decide whether or not you want to take money away from those retirement options in order to buy real estate, or whether your real estate retirement portfolio needs to be entirely separate and additional to your other options. Sometimes you may also be able to find ways to use tax exemptions and deductions to help fund your long-term real estate investing for retirement. However, these are all legal and financial issues that should be worked out with your expert advisor.

When you are buying property for a retirement portfolio, then generally your plan will be based around the idea that you will hold the property for 10 to 30 years, and then sell it for a large chunk of cash. During this time, most experts agree that even economic downturns and other real estate market “problems” will resolve themselves and level the playing field, leaving you with a property that has a net appreciation since you bought it. However, in the current market, this is patently untrue for many people, and the result is that long-term real estate investing for retirement now requires a bit more planning than it did in the past.

Now, when you invest in real estate for retirement purposes, you need to do everything you can in the interim to turn that property into a profitable enterprise. In the past, simply making the payments and doing upkeep was sufficient. Presently, though, in order to really get the most bang for your buck, your buyers need to feel that they are not just buying a property, but that they are buying an opportunity.

There are several ways to do this without becoming a full-time property manager (don’t worry!). First of all, when you buy, check out current zoning regulations and zoning history on the property. If there is a good chance that the property could be used for more than one thing, then it could be far more valuable in the future if local and federal governments continue to encourage “multi-use” developments with monetary incentives and tax breaks. In addition, if the property needs energy retro-fitting that is not particularly complicated; this is a great way to make it more attractive to a tenant and to get potentially high-dollar tax breaks for one or more years to come. Of course, one of the best and more traditional ways to make a property increase in value is to install a long-term tenant in your long-term investment. If the property comes with a reliable tenant that is already generating an income and taking care of the property, that deal will be nearly impossible to beat – and you may even end up keeping it for yourself as a wealth-generator long after you have retired.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

In this case, we are going to discuss how to handle long-term investing in a strong economy that has led to a seller’s market. Of course, right now, this seems like a distant possibility. Right now, if you know “the moves,” you can find incredible deals on great properties and get those properties at pennies on the dollar. But it never hurts to think about the future…

At some point in time, the market is going to change again. When it does, the sellers will be back on top. Ideally, you will have used this “weak” or “bad” economy to get your hands on some really good deals, so that when the market does change, you are not still trying to get property, but instead involved in selling properties for the highest dollar and the greatest profit possible. However, just because ideally in a seller’s market you will be selling, this does not mean that good deals on long-term investments cannot be found in a strong economy. On the contrary, strong economies are the best times to invest in improvements on properties that will make them worth more, and they can also be a great time to snag distressed properties that may have been neglected and therefore are not attracting as much attention as their “prettier” counterparts.

You may be familiar with a colleague of mine who espouses the idea that you should “glam up” a property before you sell. This means not only cleaning it up and throwing out a welcome mat, but it also means giving the fixtures a little pizzazz and adding some trendy, inexpensive customizations such as an interesting paint job or a stylized bedroom theme. During downturns in the market, these types of customizations turn into a big gamble, because buyers may not be interested in paying for them when they can get by without them. However, they can mean big money if you are selling off your long-term investments in a strong economy.

If the economy is booming, then you may feel like you cannot find good deals on real estate. However, you just need to look a little harder. There will always be good long-term real estate investments out there for pennies on the dollar, but you may have to “kiss a few frogs” (that is, look at some pretty ugly houses) to find them. Just remember, when it comes to long-term investing, what that house looks like now has very little to do with your future profits.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

and any economist would agree with you

However, you may not feel like you have that money to spend. Perhaps you are hesitant to sink your nest egg into a long-term real estate investment that all signs indicate could be complicated to get out of. This is not paranoid or gun-shy, as many real estate investing “gurus” would like you to believe. This is just plain common sense. Do not spend what you cannot spare. Fortunately, this does not have to mean that you have to pass up on the long-term real estate deals of a lifetime just because you do not have hundreds of thousands to spare in the bank.

If you want to invest long-term in real estate when the economy is bad, you will need to be flexible and informed. Creative financing is at its peak popularity right now because traditional loans are so hard to come by, which will make your flexible thinking a little easier to swallow for many sellers. So do not be shy about suggesting creative financing alternatives for purchasing properties. Do not forget that you have many options, including seller-financing, subject-to transactions, lease-option transactions and private money, to name a few. In addition, you should plan to spend a lot of time working on the down payment that your seller requires, since there may be a lot of upkeep or repair involved in the property that you are interested in. The down payment is certainly not a thing of the past, but unless you are buying with the help of a bank, a 20 or 30 percent down payment is unreasonable, and many sellers are settling for little or nothing or installment down payments just to get their properties off the market and off their backs. You need to think flexibly so that your seller can be flexible too.

Once you have the flexibility down, work on getting informed. If you are clear about the options that you can present a seller, then you will save yourself a lot of time and effort when you are tracking down deals. For example, if you know that you can put down 2000 dollars on a house but no more and that you want a subject-to transaction with a fixed interest rate of 5 percent or lower, then you will be able to target deals that appear to fit these criteria. Being informed about your options lets the seller know you are serious and will help them take you seriously even if you are suggesting things that they may not feel comfortable with.

In a lot of ways, I think this is the best market yet for real estate investors – whether they have cash to spend or not. Being educated and flexible is the key to real estate investing in any economy, but these traits will skyrocket you over the rest when it comes to snagging the good deals in a bad economy.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

One of the things to look out for in subject-to deals is the terms of the mortgage. If you planned to only own a property for a few months or even a year, for example, then a second mortgage with an ARM, a short term on a fixed rate or a balloon payment might not be that big a deal. However, if you are in it for the long haul, then those lousy terms become your problem, and you should steer clear of mortgages that do not have fixed, low rates – even if you think you can refinance, because unless you have the new financing in place already, nothing is certain right now in that arena.

Once you have made sure that the terms of the loan are acceptable, start thinking about things that will make this investment to your advantage. Most subject-to sellers would like to include in the terms of the sale that you will refinance the property after a certain period of time – often 3 to 5 years at the outside. Again, if you were going to flip this property, then this would not be a big deal. However, if you are going to own it for the long haul, you do not want the seller showing up 10 years down the road saying that you failed to keep up your end of the bargain because you were not able to refinance. Make sure that you can keep that mortgage and that interest rate for the life of the loan if you wish.

Finally, check on any other regulations having to do with the property. For example, many real estate investors like to rent out their long-term real estate investments. However, many homeowners’ associations (HOAs) prohibit this. A seller is not likely to tell you this type of thing even if they know about it because it could discourage you from purchasing the property. It will be up to you to check zoning, HOA regulations and any other legal requirements that are involved with the property because these issues are going to be your issues once you purchase the property.

Finally, make sure that the seller does not have any outstanding liens against the property. These liens can and probably will become your liens, even if the seller signed for them personally. If the seller has borrowed money against the property from a private lender or even an acquaintance, you must get the terms of that loan renegotiated before you buy in case at some point the seller fails to make those payments and the note-holder comes after you and your property to satisfy the debt.

Buying subject-to properties in the current market is a great way to add to your real estate investing portfolio without a large outlay of cash. Some particularly motivated sellers will sell for no down payment at all just to get out of their mortgages, and even the most stubborn sellers often can be negotiated down to down payments that are extremely small – particularly in today’s credit market.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.

When you are investing long-term, you will have a lot to think about. You should determine how you will pay for the property, a variety of options for making the property generate money, and at least 3 different exit strategies (long-term ideal, short-term ideal and emergency) to make sure that you are always able to make your long-term investing situation work for you.  Once you have determined that the property is a good buy and a good fit for you, however, you need to also investigate options for making that property worth more in the short term and the long term.

When you buy a long-term investment property, you will want to factor in improvements that will help its short-term productivity as well as its potential in the long-term. This means that while remodeling the bathroom might improve the value of the home, if you can get away with changing out the fixtures, then spending the remodel money on something that might really appeal to your tenant demographic (for example, a swing set or a sandbox for the backyard if you are trying to attract families), then this might be a good place to make a short-term investment in order to increase the attractiveness of the property. Anything you can do in the short term to help your tenants see themselves in the property long-term has multiple benefits:

• It increases your likelihood of attracting responsible, long-term tenants
• It increases the odds that if you needed or wanted to do a lease-option agreement at some point, you could
• It can help you fill up your property fast
• It will keep your property in demand

Of course, some short-term investments will be more significant than a swing set. For example, you might need to do some serious work on the exterior of the house in order to make it more durable in the event of inclement weather.  While this may not be as obvious to your tenant as you wish it were, in 5 years when everyone else is repainting and repairing hail damage, you will be patting yourself on the back. Another good way to get money back out of a property in the long term is to make sure that it is energy efficient. As more and more government regulations on energy consumption go into effect, homes and properties that meet the requirements are expected to receive benefits for meeting these standards.

Peter Vekselman has been successfully investing in real estate since 1996.  He has completed over 1200 real estate deals, owned a construction company, been a private lender, and owned a property management company.  Peter currently works with clients all over the US helping them achieve riches in real estate.

If you are interested in talking with Peter further about his private real estate coaching program please email him directly at peterv@pvretraining.com with your full name and all your contact information along with “why you need a mentor / coach”.