We spoke to Mike Simmons of Return On Investments, LLC, a real estate investing company located in Michigan, and he provided some insights on how to successfully buy and sell houses fast. Read on below for a brief summary of our conversation.
There are many reasons why people start looking into real estate investment. It might be to earn some extra money for the sustenance of your family or to improve your living conditions a great deal by having life altering income. Whatever be your reason, if you take out a home mortgage for investing in real estate, it is better that you are well equipped with enough information as to how to make your real estate investment have worthy returns. Since the investment market is quite volatile the right kind of leverage is really important. Read on to know the two pillars on the understanding of which the success of your real estate investment lies.
Finding out properties and evaluating them – As an inexperienced investor in real estate, most of the times you fail to understand which property would be worthy enough to invest in. The only experience you perhaps have had on looking at homes and evaluating them is when you bought your own property. However, you should keep in mind that buying an investment property is nothing similar to buying a house for yourself. The purchase of your home was based on your emotions, your personal likes and dislikes, however, you cannot base your investment on your emotions. What you need to do is observe the property as a product. Among the things that you need to consider are the comparables selling for in the area, the stack up of the current price of the property, how much repairs would be needed to fix the house for maximum value and so on.
Finding the money for funding – You will find out that most of the homes you want to buy as an investment property don’t qualify for FHA loans. Hence you have to take out a traditional home mortgage for them. You have to approach hard money lenders or private money lenders to help you finance your investment. Also, a huge snag that you will face is that finding money on credit. The biggest challenge you will face is finding an investor who would agree to give you a loan with no cash down, credit requirement, job history requirement and so on during the initial term of your loan. Although difficult to find, such lenders still exist.
Along with the above two pillars, you need to know how to make your real estate property sell. In this way, you can also pay off your home mortgage and successfully gain profits from your investment.