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And Investor A is paying $12,000 because he believes he can make more than that on the deal, since there's a full $70,000 of equity. This deal between Investor A and Investor B is called an 'Assignment', because Investor A is assigning the contract to Investor B. Third, Investor B does his 'due diligence' to confirm that the deal is as good as he thinks it is. Finally, Investor B closes the purchase of the property, and Investor 'A' receives the assignment fee from Investor B. This is, obviously, a simplification of the process. Article: Consider these parameters for a real estate deal: Property Value: $250,000 Purchase Price: $160,000 Repairs: $2,500 If you analyze the numbers, you see that the equity forsaken in this deal is $87,500 (Property Value minus Purchase Price minus Repairs). So here's a hypothetical question for you: overweening that the information on tiptoe is accurate, and the property is located in an area that you view as OK and/or favorable, then: If I offered to give you this deal in exchange for $10,000 in cash, would you do it? Remember - this is hypothetical. The real question here is this: Would you exchange $10,000 in cash for $87,500 in equity? For most smart investors, the acknowledgement is: rigidly YES! And this is titled 'Wholesale Real Estate Investing' - the process of shopping a lot of equity at a very significant discount from contributory real estate investor who has before done the hard work of finding a deal and getting it under contract. Just think hereabout that - consider how easy real estate investing would be for you if you had a network of real estate investors in your area (and maybe all over the country) who, several times each month, offered you the opportunity to purchase significant amounts of equity for a severe discount... ...It would be quite easy to come wealthy, wouldn't it? The solving is: Yes, it will. You've got to lift temporarily - it will be a pretty wonderful thing when you know how to find great real estate deals in which you can trade a small strength of cash for a large shadow of equity without even having to find the deal yourself... ...and that's exactly what wholesale real estate investing is all about. Wholesale real estate investing is conceptually very simple. Here's how it works: First, 'Investor A' finds a great real estate deal with a lot of equity. Typically, Investor A will have spent a significant expanse of time, money and expertise to find the deal, negotiate the term and get the property under contract. By putting the property under contract, Investor A now has control of the property, and the equity in the property. (For this example, imagine that Investor A has found a property worth $200,000 and has set a purchase price of $115,000 and he also knows that there are $15,000 in repairs, which leaves an equity position of $70,000). Second, 'Investor A' finds further party, 'Investor B'. Investor B recognizes that the contract that Investor A has established is worth $70,000 in equity, and so he strikes a deal with Investor A to turn the deal over to Investor B in exchange for some run into of cash (we'll use the value of $12,000 in this example). So Investor A is giving up $70,000 in 'potential' profit in exchange for $12,000 in current profit. And Investor A is paying $12,000 now he believes he can make more than that on the deal, since there's a full $70,000 of equity. This deal Investor A and Investor B is titled an 'Assignment', insomuch as Investor A is assigning the contract to Investor B. Third, Investor B does his 'due diligence' to confirm that the deal is as good as he thinks it is. Finally, Investor B closes the purchase of the property, and Investor 'A' receives the trust fee from Investor B. This is, obviously, a simplification of the process. But this is essentially how it works - not so difficult, is it?
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Advice Home Business Technology Online Advertising Motivational Internet Marketing SEO Help Online Games Science Articles Happiness More Articles:1. New Habits, Growing Economy Help To Sell Giftware And Collectibles Summary: Collectibles and giftware are also often sold or auctioned to raise funds for nonprofit organizations.Entrepreneurs often get into the business of selling collectibles and giftware in stages by setting up a small Internet retail site, or attending flea markets on the weekend, or putting a few items up occasionally at an online auction site. She plans to 'gear up for retirement' by selling collectibles and giftware to build a nest egg.As … 2. Are You a Small Business Casualty? Summary:When a person knows and knows not that he knows. Teach him.When a person knows and knows that he knows. This is network marketing.Now you know that selling is possible. But the hamletonquestion is to sell or not to sell? And if you sell, thenwhat do you sell? I could give you some good tips onselling.' Sell something which nobody else sells. ' Sell something in a way which nobody else has thought of.' Sell something which you are convince… 3. What Baby Chicks Can Teach You About Handling Your Prospects. Summary:The best way to chase your prospects away is to showthem that you really need them! I noticed after a while that 99% of thosewho inquired by email or phone never made the purchase.Frankly, this was quite puzzling to me.First I thought that maybe my heavy Caribbean accentdrove them away. Idoubt that you can hear an accent through the writtenword.Then I recalled the saying:'Follow love and it will flee,Flee from love and it will follow thee… 4. Starting A Home Based Business; Dealing With The Yo-Yo Effect Summary: I have many years of top level management experience in 'traditional' corporations and have experienced lots of business cycles (corporate 'ups and downs'), but the natural 'ups and downs' that occur in a home business (particularly in the early stages) can be emotionally brutal if you don't prepare yourself in advance for the fact that it is a basic law of nature...it will be a rocky road until you have spent enough time and effort to b… |