Every Real Estate Investor Should Master

When you learn about something, when you are interested in new subjects, you also learn a whole new vocabulary you start using. Well, with real estate investing happens exactly the same. If you are a Real estate beginner or an experienced investor, you must understand and master all the terms and words of the investment vocabulary, especially acronyms, so here is a small list of every acronym a real estate investor should know:

1. PITI

Initials for: Principal (P), Interest (I), property Taxes (T) and Insurance (I). Essentially this means, the “bottom line” or the minimum amount needed when you estimate the acquisition of investment property with a loan. Frequently this is estimated monthly.

This amount is what you would might spend in the investment property over the life of the loan. Every and each month is the frequency of the PITI you have to pay in order to be in good standing. Thanks to this you will know how much rent you should pay.

2. GOI

GOI or Gross Operating Income, is related to the annual income that is collected from the property, including: laundry, parking, storage, etc. and consider any vacancies.

3. LTV

Initials for: Loan-to-Value, this is vital if you’re removing a loan on your investment property, it is estimated by dividing the loan by the property’s value; then, that number is expressed as a percentage. For example, to make it easy: if a loan is $200,000 and price of the property is $250,000, then the LTV is 80%.

You will have more equity in your property and negotiate more if the LTV is lower.

4. DCR

Initials for: Debt Coverage Ratio. This is referred to a commonly used term by lenders when they have to deal with underwriting loans for income-generating properties. How it is calculated? You need to divide the NOI (see below) by the total debt. If the ratios is 1.20 or higher, this is considered the average.

5. NOI

Initials for: Net Operating Income, this is the income left over from your rentals after paying all your monthly operating expenses. So, deduct your expenses from your GOI (Gross Operating Income) to get you the property’s NOI. For example, if you take in $20,000 in leases on all the units you have and spent $6,000 on maintenance including supplies, accounting, taxes, insurance, utilities and more, the NOI for the month was $2,000.

If you felt this information was useful and want to learn more about real estate. You can go to our Official Website and see all the incredible ways we have to offer to invest in real estate.

Real estate and how to avoid being scammed

 Last week, the California Bureau of Real Estate made an advisory to help consumers, especially senior citizens in order to avoid fraud on real estate for home loans, rentals, timeshares and property recordings.

Many people know how to trash unsolicited mail with official-looking seals that offer refinancing a home loan, take out a loan and find a place to rent or avoid foreclosure. But many people don’t know that exists a Department of Consumer Affairs where a consumer can recover accounts and present their cases on the California Bureau of Real Estate.

If you are an intentional fraud victim because of a California real estate licensee you can recover actual and direct losses up to $50,000 per business deal, with a total payout of $250,000 per licensee.

Want a tip? You can call the California Bureau of Real Estate at 1-877-373-4542 if you suspect you are a victim of real estate fraud.

In order to prevent those phone calls, we give you 10 fraud avoidance tips:

1) Be alert and don’t feel bad if you are suspicious of unwanted offers, suggestions and calls. Be careful with license numbers on mailings and websites.

2) Be in contact with the state business bureaus. Be smart and look for references. Do a research with the help of Google, Yelp or other websites to have important information about the company, and the most important: to see if they have a relation with other consumer scams or frauds.

3) Do not agree to pay money for a service, and always protect your personal info– specifically your SS number.

4) Avoid paying in advance for home loan or any foreclosure relief services.

5) If you can’t afford a property, never sign the agreement for that transaction.

6) Be totally suspicious if a real estate or home loan agreement is not clear, it is difficult to understand or encloses blank spaces. If an agreement has blank spaces it is easy to be manipulated for a scam artist.

7) Don’t sign your property over to somebody who claims such a transfer can and that he or she will help you with the reparation of your credit.

8) At no time sign a “power of attorney” to give any person or company the rights to your property if you don’t know them or trust.

9) Keep a track and always check the title to your real estate properties, if you detect something suspicious or fraud act immediately. Many signs can be related to: stop getting your property taxes, some real estate documents in the mail for operations you did not make or a notice of default of your home.

10) If you are the owner of an insurance policy on your property, contact the title company and check with them if you are protected against forged deeds or fictitious documents recorded after you bought the property.

Hope this tips help you, don’t hesitate to call if you see something suspicious. Check FCI if you are interested in real estate.

How to obtain your first investment property

When talking about real estate we notice it is a very complicated subject. The problem is that it is very capital concentrated, especially for those who don’t have assets. The truth is that buying a good rental property is hard, but it is also possible.

Steps to acquire an investment property

Step 1: Learn and study everything about real estate

This is the toughest part but if you want to be successful you need to learn how real estate actually works. Read books, even if you only understand half of it, keep working through it and eventually you will understood most of it. If you don’t know a term google it but try a way to learn everything you can.

You will see that the beautiful thing about real estate is that there are different ways to make money (investing, brokering, research, tech, appraisals, renovations, etc.). That is real estate is a huge driver for the US and global economy.

Step 2: Commit yourself to own real estate

This is vital in the process. Not everybody comes from a wealthy family but that doesn´t mean you can own something, to be able to buy properties you have to be committed.

Embrace the fight, use it as motivation. If you are really committed, you will get it done.

Step 3: Develop a strategy

An attainable strategy for most people is to buy a single-family house with an investor and rent it out for income and price appreciation. This is just to start. Focus just on achievable goals.  Your strategy is to have goods that will cash flow. By the end of the year, the outlay must be less than what the property brings.

First, find a property: Go to Fci Exhange or other listing site and look what is on the market. Once you find a deal, make an offer.

Step 4: Find an investor

How? Well, talk about your goal to buy real estate. It can be seen as arrogant or even taboo, but this really works. You need to sound and look smart when talking about real estate and have a plan, people need to see that it works.

Final step: stay persistent

This step-by-step process is simple. You need to be patient in this business, you will have difficulties, bad tenants, renovation but don’t freak out and never quit.

The strategy to building this kind of longterm wealth is having interest work for you, not against you and buying rental property is the most achievable way to do this.

 

How are you preparing for real estate’s new market reality?

You need to start to learn and understand! There are no more days when you could simply hand your clients information, now you need to explain them what are you sharing to them. It is said that there is a large gap between information and actionable knowledge.

Heart of a Teacher: This means that you shouldn’t be trying to convince someone to do something; you can help your clients trying to discover what their options are and let them make decisions that are best for them and their families.

Dave Ramsey says: “When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman”

Strong Visuals: People process visual information 60,000 times faster than text. With attention spams dropping, this can mean the difference between someone seeing and understanding your message versus missing it completely.

Go mobile or go home: Having visuals on your smartphone or tablet is just a way to earn the trust of your clients by confidently answering their questions wherever you are.

Keeping current is vital: In a day when market information and analysis are so important, staying on top of the changes and the impact they will have is perhaps most important.

For more information on real estate, go to www.fciexchange.com or follow us on twitter at @fciexchange

HOME BUYING AND SELLING LATEST TRENDS

 

1. Home Sell fast, no discounts: In most parts of the country the homes are selling really fast and they are being sold near or above the listed price so forget the days of low estimated offers on homes, sit back and wait for desperate sellers. In a latest study by ZipRealty about the market, homes have selling at or above the listing price and that included different states like San Francisco, Seattle and Washington DC.
2. More homes hit the market, but not enough: as home prices climb and more homeowners start to regain equity , home owners will be more likely to list their homes for sale, the number of homes for sale in US including condos had increased in the last months of the year, but you need to have reasonable expectations, price your house at the right price so you can sell it quickly.
3. Mortgage rates rise: the low rates have become part of history; however, rates are heading up and they are unlikely to return to the low levels again.
4. Say goodbye to rates in the 3 percent range and get use to rates in the 4 percent range. This means that as mortgage rise, shorter-term adjustable-rate mortgages may become more attractive to some homebuyers and refinancers.

                         

DO YOU KNOW THAT ONE OF THE MOST PERFECT PLACES TO INVEST MONEY IS ACTUALLY REAL ESTATE?

There is a ton of emotional sellers that you can make money off.

If you are looking to invest in real estate you need to have something clear: you can always find a deal as long as you look for it. If you have some fortitude and some patience, investing in real estate might be an excellent time to invest in real estate.

You don’t need to be experienced to learn about the deals and start connection to be successful. You can understand market trends and bargains so you will be more likely to make money.

You should only be bidding on properties that have been on the marketplace for 6 or more months, and you should always be cash-flow-positive with any property.

Don’t take features like schools districts for granted because homes with these types of desirable characteristics usually sell fast. Plus, homes with good school districts frequently have a lower crime rate.

You should consider another important fact, when you are looking to invest real estate, you are thinking about buying a new property and then selling it. But the truth of the matter is that buying and selling foreclosed properties is far more profitable than dealing with new ones. Why is that? When you buy a new property, you will be purchasing its value as its value market; however, with foreclosure properties you are buying far below the market value.

In conclusion, if you are looking to invest in real estate, there is always going to be an opportunity to you to earn money buying and selling properties. One of them can be find on http://www.fciexchange.com, dare yourself to start new things.