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Online Marketing Traps to Avoid for Real Estate Investors

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on Friday, 16 March 2012
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Online marketing is clearly one of the most cost effective and rewarding channels for real estate investors searching for buyer and seller leads today but it also comes with many pitfalls. What mistakes and traps should you be avoiding for getting the most from Internet marketing and your real estate business?

1. Not Closing on Social Media Opportunities

Yes, social media is for providing valuable content and attracting followers and a hard sell pitch doesn’t always work as it does with traditional, direct response forms of marketing but this does not mean you shouldn’t be trying to close deals with it or that it can’t produce real leads incredibly quickly. Many others are making big bucks with social media and generating real customers and sales and real estate investors should be too.

2. Underestimating the Importance of Social Media

It isn’t just the immediate lead generation opportunities that real estate investors are missing out on from social media. You don’t have to love or use every form of advertising just because it works. However, the real power of social media for real estate investors is being able to reach so many more prospects for less money and then being able to market to them over and over again for very little.

3. Skimping on Content Marketing

Unfortunately it is easy for new real estate investors to be lead astray with so much bogus and outdated online marketing advice out there today. Most notably this comes in the form of those still selling article spinning software and suggesting the right strategy is just to flood the web with low quality, keyword saturated content. Those who have been paying attention will know that Google has already made several changes in the last couple of years to penalize those using this type of approach and is rewarding those with fresh original content with better rankings.

4. Allowing Online Marketing to Become an Expensive Distraction

Becoming a little savvier about Internet marketing is smart. What isn’t smart is spending the next 12 months mastering it and less time actually flipping houses. What yields the best return on your personal time? Delegate your online marketing to someone who specializes in it and do what you do best and makes you the most money.

5. Poor Follow Up

Once you get a good online campaign running it can be difficult to keep up with all of the leads and phone calls. Don’t let great leads go to waste. Automate your follow up systems and streamline your processes.

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Why Warren Buffett Isn’t Investing in Masses of Single Family Rentals

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on Tuesday, 13 March 2012
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Famous investor Warren Buffett was recently quoted as saying it was a great time to buy a ‘couple hundred thousand’ single family homes and is extremely bullish on the outlook for the housing market and economy over the next few years. So why isn’t he doing it?

There are two main reasons…

1. Property Management

Warren recognizes that while home prices and the current bargains on the market are appetizing, taking on an empire of single family properties can also be a property management nightmare. This means buy and hold investors either need to give up some of their cash flow and profits to pay a property manager or face the frustration, liability and endless hours of doing it themselves.

2. Financing

While mortgage interest rates are certainly incredibly low and probably won’t remain this tasty for too long getting a long term home loan, especially on an investment property isn’t easy. This is not only a challenge for real estate investors buying right now but in case any homes need to be liquidated in the near future.

There is one more thing Buffett has failed to highlight in his recent interview spree. He comments that as the economy improves more relationships are formed and there are more marriages, resulting in new home purchases. However, times have changed from the last few cycles and divorce and separations are much more accepted today, meaning that more people will be able to afford to split too. This will also bring a demand in housing though much of it may be smaller residences rather than ‘McMansions’.

We are in a peak market for flipping houses, with prices rising and more investors getting in. It is time to build a fat pipeline of deals that can be quickly flipped using transactional funding. Just make sure that you stash away a good portion of your profits for a rainy day.
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Preparing to Switch Strategies as Mortgage Lending Gets Tougher

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on Tuesday, 28 February 2012
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Mortgages could quickly become a lot tougher to get. How are you going to maintain the volume of your real estate investing business and enable it to grow?

The headlines have been full of calls to wind down mortgage giants Fannie Mae and Freddie Mac in he last few months with potentially devastating consequences for U.S. borrowers. Even the governor of the Federal Reserve, Elizabeth Duke came out at a hearing today stating there would be “much, much less lending going on,” should they be closed in the near future. These agencies to have issues, including already forking out over $110 million in legal fees to protect executives and Bank of America announced early this month and end to selling mortgages to the giant entities. However, when banks hold onto their mortgage paper in their own portfolio they are far tougher about the loans they will make.

So what does this mean for those flipping houses? Fortunately, this won’t affect acquisitions for real estate investors taking advantage of transactional funding. However, those who have been relying on end investors or home buyers who are using financing to turn their deals over to may need to rethink their strategies and focus.

Those who do not just want to keep up the volume of houses they are flipping now but who want to grow that number may need to focus more efforts on attracting cash buyers. The good news is that there are plenty of them out there, however there is also a lot of competition for them.

The more resourceful investors can be in marketing to and attracting these cash rich buyers the further marketing dollars will go and the bigger the bottom line. Consider how you can work with strategic partners who already marketing to these prospects or whom already have large databases full of them. This could include working with financial planners, tax accountants, attorneys and others. Look for opportunities to network where there are large numbers of cash buyers in attendance like at regional or national property shows both here and abroad as well of course bolstering your web presence.
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Why Wholesaling Remains King in 2012

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on Wednesday, 22 February 2012
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While a new upward surge in the real estate market may be gradually sweeping the country investors may want to think twice before switching their real estate investment strategies. Wholesaling still remains king and here’s why…
Right now many real estate investors are busy and distracted with trying to become rental specialists, moving into property management and even attempting to promote themselves as real estate gurus. These things are fine and may be a natural expansion for some but they surely don’t promise the fast and fabulous money that wholesaling real estate does. That’s OK, let them stir up frenzy in other channels and keep on flipping properties with less competition. After all, they are going to have to turn to someone for inventory, why not you?
Wholesaling has always meant less risk, at least as close to zero risk as you could ask for. Even if the market is picking up it is on much shakier legs than the last bubble. Better to get in, out and paid and let someone else worry about juggling huge amounts of overhead and ducking malicious lawsuits every month. Plus, eminent domain is making a comeback and the last thing you want is for your nest egg to be condemned and seized so that others can make bigger profits.
Of course there is always the financing issue too. While subprime bonds may be making a comeback too we are probably a long way off from seeing the easy financing of the early 2000s. That is with the exception of transactional funding. Why break your brain, lose more hair and risk your deposits on an underwriter being in a good mood? Keep on wholesaling…
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Investors Must Prepare for Major Market Shift

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on Tuesday, 07 February 2012
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There is a major market shift coming that could end the majority of real estate investor’s businesses as fast as the last bubble bursting if they aren’t prepared for it...

Regardless of what the banks and government are doing or proposing to stem the flow of foreclosures a seller’s market is on the way and if the wave hasn’t hit your area yet, it could be a tsunami sized slap to your cash flow.

Real estate investors have enjoyed a free ride for the last few years with endless deals at ridiculous discounts to choose from. Many have never experienced a bidding war or know what it is like to be told not to make an offer unless it is full price. However, this is already happening in many areas of the country. There aren’t weeks or even days to think over whether you should put a property under contract, demands for bigger deposits and Proof of Funds are increasing and even trying to get a return call about an available property is going to be pretty difficult. If you business model isn’t structured right you could be in for a big wake up call and a stall in your cash flow.

Real estate investors need to be building better relationships with wholesalers and agents, be improving their negotiation skills, be prepared for tighter spreads as sellers push up their asking prices and focusing on attracting more buyers.

The one big difference between now and the last boom is the lack of availability of financing. There are lots of cash buyers out there to flip to but with sellers becoming tougher o the window to close and hard money a lot harder to get than ever before transactional funding is going to be crucial to your success. Start preparing for the shift now...
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Real Estate Advertising Trends for 2012

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on Wednesday, 18 January 2012
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Are you positioned to attract the most buyers this year?

Finding plenty of discounted properties to flip certainly isn’t a problem yet and there may be more buyers ready to get into the market but competition for them is heating up too. Will you be the one to win their business? Are you up on the hottest real estate advertising trends of the year?

It doesn’t matter how many wholesale deals you get your hands on and how well you can use transactional funding for no money down real estate deals if you don’t have the buyers. Experts predict a sizable increase in advertising spending this year. Where will your competition be turning up the heat? What advertising channels will you need to defend and which will be left open for you to capitalize on?

It is no secret that offline marketing channels are dwindling but this could make direct mail, TV, radio, display and print easier for you to compete in. Not only are there fewer of your competitors now using these channels meaning a higher ROI on your real estate marketing but vendors are currently much more likely to cut deals.

So where is the most money expected to be spent on real estate advertising in 2012? Search, mobile, social and video. If you don’t think you have the budget to develop your own mobile apps yet at least make as many tweaks to your online presence to make it as mobile friendly as possible. Search and SEO are only going to become more critical with consumers now relying on search engines for their every move and decision. Social media, if you aren’t committed to being great at it or at least hiring someone who is you may want to start surfing the local classifieds for a new day job.

Without a doubt all research and advertising pros agree on one thing and that is video is going to be the hottest item of the year. It doesn’t have to cost you a mint, especially if you do them yourself or have templates created that you can re-purpose but you will need them.
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Is This the End for Short Sales?

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on Tuesday, 10 January 2012
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Have you been making big profits from flipping short sales? They could be about to disappear!

Flipping short sale properties has already been steadily becoming more difficult with banks attempting to eliminate what they call ‘short sale fraud’ and adding tons of new documents and affidavits to closing packages. However, real estate investors using transactional funding for fast flips of these steals have even more reason to question how long they will still be around.

Mortgage giant Fannie Mae has reportedly been sabotaging short sale deals in progress by offering sellers thousands of dollars to execute a deed-in-lieu of foreclosure instead. Many hungry for the cash are obviously jumping on the opportunity.

Recent reports by lenders also show an incredibly low level of interest in short sales from those whom they have been offering up to $20,000 to do them.

On top of this new government and bank plans to stem foreclosures through further relaxing of refinancing requirements, turning properties into rentals and auctioning off bulk REOs could further deflate the motivation to entertain short sale requests from borrowers.

So is this the end to the free ride on short sales? Not likely. The tax break to offset deficiencies in payoffs is set to expire next year but this could well be extended. Plus, short sales have been around a lot longer than most people think. Lenders have often used short sales to unload unwanted loans and homes, even during the recent boom years.

So short sales will still be possible but it is wise for real estate investors, especially those who are flipping houses to diversify their sources of distressed properties now in order to maintain volume and cash flow. Try looking further back on the chain and figure out how to catch pre-foreclosures before they even happen.
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How To Get The Most Out Of Your Marketing Budget

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on Tuesday, 27 September 2011
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Real estate investors, especially those who are starting on a tight budget often find themselves faced with tough choices as to where to dedicate their marketing budgets. So how do you get the most out of what you’ve got?

The biggest problem most real estate investors encounter when planning their advertising is trying to split it between marketing to buyers and sellers. While you of course need both to make money from real estate investing, dividing your budget means decreasing your advertising effectiveness. If you can hone in on one side then you will find that you will get far more out of your budget.

Fortunately with so much inventory still out there between REOs, short sales, foreclosure auctions,  HUD homes and other wholesalers you really need to spend very little time and money on looking for sellers. Choosing a few select sources that can bring you discounted properties every week and getting a few bird dogs out there hunting for off market distressed homes should provide you all the inventory you need. This will allow you to spend more on attracting the most precious commodity of the moment, home buyers.

If you have plenty of buyers you will find flipping houses becomes extremely easy and you will have more investing opportunities than you can handle. By cultivating a large database of buyers first you will also be able to take advantage transactional funding which not only makes turning properties faster but will keep you flush with cash which can be invested into more marketing, helping you to rocket your real estate investing career even further than you imagined.

Types of buyer marketing that you may want explore which can provide maximum reach and ROI on your time and dollars include social media, webinars and cross promotions and joint ventures with strategic business partners.

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Creative Ideas For Flipping More Houses

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on Monday, 19 September 2011
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While some areas of the country may actually be starting to see the housing market turn more in favor of sellers it is still essential to be constantly innovating in order to flip houses quickly and consistently. Don’t copy local Realtors and other investors. Their marketing may not be as successful as it looks and it certainly won’t help you stand out.

So what could you be doing to flip more houses? Those who already have homes and are planning open houses should strive to maximize traffic, not only through invitations but by pulling in as much drive by traffic as possible too. It is a fact that your best pool of buyers often comes from those who have family or friends in the neighborhood already. So have the kids put up a lemonade stand and wave cars in, hire some attractive ladies to do car washes while prospects browse your homes or come up with a creative giveaway for everyone who stops in.

Giveaways are often hotly debated. Forget the gift cards to Home Depot, free TVs or iPads. Come up with a giveaway that will get your real estate investing company in the news. You can write your own press releases or contact journalists from local newspapers with your story. What about giving away free pizza or Starbucks for a year? Or are there any other local businesses who you can partner with, who will donate a giveaway for the free marketing attention?

If you already have a number of properties why not organize a limo or helicopter tour of them to maximize your sales potential in one day. If you are by the water then perhaps even a foreclosure cruise could be a great idea. Plus if you sell enough homes on the spot you can take the next couple of weeks off to relax and enjoy your profits.

Finally, get creative with your financing by tapping into transactional funding so that you can close faster and rocket your volume so that you can sell more homes.
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Transactional Funding For Keeping Your Deals Alive During A Hurricane

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on Monday, 05 September 2011
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Hurricanes not only bring the threat of property damage but can also completely throw your cash flow out of whack if you aren’t prepared with a good transactional funding source.

As soon as a hurricane comes on the radar today home owners and sellers get nervous. Capitalize on this by utilizing transactional funding to close quickly as a cash buyer before a hurricane comes through. The odds are it won’t hit your homes and providing you are reselling immediately it actually won’t affect you either way.

If you already have real estate deals lined up and homes under contract as a hurricane approaches transactional funding can be a big life saver. You can’t afford to go weeks or a month without closing deals if you need cash flow coming in. Forget waiting for approval on a conventional mortgage as they are sure to stall and hold onto your cash by working with a transactional lender who will give you 100% financing. This will help you stay liquid, with plenty of reserves in case you own any other homes that need cleaning up or repairs after the storm passes.

After a hurricane passes any deals you had in the pipeline that relied on conventional mortgage financing are going to be a nightmare as you wait weeks for new appraisals to be done and reviewed. If you have cash buyers use transactional funding instead and keep on flipping those houses. Maybe you can even pick up deals from other investors who now cannot close on their contracts or at least receive a referral fee for sending them to your transactional lender. Also stay poised to jump on motivated sellers afterwards who don’t have money to fix their properties or who fear another hurricane. You may also be able to hook up with a few local insurance agents to get some extra leads during these times.

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Should You Be Worried About Short Sale Fraud?

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on Wednesday, 03 August 2011
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There have been a number of stories about ‘short sale fraud’ circulating in the last couple of weeks. Short sales are of course one of the great sources of discounted properties investors using transactional funding tap into to make big profits flipping houses. So should you be worried as a real estate investor and consider staying away from short sales?

Not at all! According to one Washington, DC attorney and short sale expert in an interview this week ‘short sale fraud’ is mostly a concept dreamed up by greedy lenders who are jealous of the profits real estate investors are making.

So how are some getting in trouble for their involvement in short sale flips? It is important to note that it isn’t the investors using transactional funding to acquire and flip homes for quick profits that are finding themselves in hot water. It has been licensed real estate agents who have been found to have mislead and blatantly lied to the banks in order to get short sales approved that have been the ones catching the heat. Such is the case with the Realtor in Connecticut who just got 8 months in the slammer. It seems she found a buyer and instead of submitting that offer to the bank, had a fellow real estate agent buy the property and then had them flip it to the end buyer for an extra $30,000. Nothing wrong with making a quick profit. The issue was the agent in question clearly abused her position and deceived the bank by telling them the property couldn’t sell for more when the deal was already set up.

Should the banks care at all if the property is resold, who to, when and how much for? No, if they are happy to recoup what they can and complete the short sale that should be the end of the story. Though licensed agents do have a fiduciary responsibility and those required to sign an affidavit confirming full disclosure in the A-B side of the transaction ought to be upfront. However, again full time real estate investors may want to think twice before renewing their real estate licenses again just to avoid the extra potential heat.

Otherwise get out there, lock down wholesale deals, put offers on short sales and use your transactional lender to help you flip homes quickly for some nice paychecks.

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6 Advantages Of Transactional Funding

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on Tuesday, 19 July 2011
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1. No Qualifying
Transactional funding requires no qualifying like you have experienced when applying for a conventional or even hard money mortgage loan. There is no credit check, so it doesn’t matter if you have had a few bumps and bruises in the last few years or you previously went through a bankruptcy or foreclosure. You won’t have to verify your income, how much money you have in the bank or even if you have a job. You don’t even need an appraisal. All you do need is a qualified end buyer who you will flip the property to.

2. Quick Closings
You can get your transactional funding approved and to the closing table in just a few days, which is why it is often referred to as ‘flash funding’. It is great to have as a back up even if you have plenty of cash just in case something comes up so that you won’t miss your closing. Plus many property wholesalers today will only give you two weeks to close if you want to get the deal. So if you want the best bargains and the biggest profits you really have no option but to pay cash or use transactional funding.

3. Act As A Cash Buyer
The speed that transactional funding provides and the fact that there are no underwriting hoops to jump through means that you can really act as a cash buyer and demand even bigger discounts when making offers on properties. This will give you a decisive edge over your competition and allows for either making a larger spread on each deal or being able to flip houses with a lower retail price tag so they move faster.

4. 100% Financing
Transactional funding provides 100% financing of your purchase price plus closing costs enabling true no money down real estate deals.

5. Lower Risk
Having access to a great transactional lender means being able to flip homes quickly and easily, getting in and out without the risks associated with holding or speculating on appreciation.

6. It’s More Affordable
If you have used conventional mortgage financing or hard money lenders to fund your real estate deals in the past you know that hefty junk fees and paying lots of points can seriously dig into your profits and make or break a transaction. You will find transactional funding a lot cheaper, leaving more money on the table and in your bank account.
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7 Tips For Successful Real Estate Investing

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on Tuesday, 12 July 2011
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1. Have A System
Don’t just have a plan, have a system that with enable you to operate efficiently and rapidly grow and scale your real estate investing activities. This way one day you can even begin franchising or sell your business for big bucks.

2. Find A Great Funding Source
Even if you are getting into real estate investing cash rich at some point you are going to want to use leverage to do even more. So find a few great funding sources for your acquisitions including conventional mortgage lenders and banks as well as private lenders and transactional funding sources.

3. Build Relationships & Partnerships
Loyalty goes a long way in real estate investing. Plus the more business you give one company whether it is a transactional lender or Realtor the better deals and more flexibility you will find. You can also bet that having a good relationship with your vendors can also help you pull off even faster closings and flash funding when you really need to get a deal done ASAP.

4. Inspections
You have heard it before, but it really can’t be said enough - always get inspections done no matter how many deals you have done before and how fantastic a condition the property appears to be in. This also applies to walk-throughs. You never know what can happen between the time you sign the contract and you hand over the cash.

5. Don’t Alienate Real Estate Agents
Some real estate investment courses have portrayed real estate agents as the enemy and too costly to deal with. However, in reality they can often find you great deals, save you plenty of time and even help you find the best flash funding sources when you need quick financing to close on your flips.

6. Always Be Networking
Sometimes it is really who you know, not what you know that brings you great deals and helps you get them closed. Your success in real estate investing will directly relate to how many new contacts you can make each day.

7. Keep Building Your Marketing Skills & Knowledge
Today the deals go to those who are great at marketing themselves. So keep on top of the latest trends, embrace social media and mobile marketing and get out there to win the most buyers and sellers.
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Is Transactional Funding Legal?

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on Tuesday, 05 July 2011
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Staying on the right side of the law or at least avoiding extra unwanted attention from the authorities can sometimes be a tricky business when flipping houses. Unfortunately many out dated real estate investment courses and programs provide information that either doesn’t work any more or has become illegal. However, this does not include transactional funding.

Dry closings or simultaneous closings where an investors uses a buyer’s money to fund a double closing and pay the seller are definitely frowned upon and can at the very least get you the wrong type of attention. Plus of course it does pose technical issues with recording deeds in time to satisfy the end buyer’s lender’s requirements which can jeopardize your deals.

Flash funding or transactional funding is different. This type of financing provides you as a real estate investor with the funds to close your A to B transaction with the seller, with real money. Then you can have a separate closing for the B to C side which cashes you out with your end buyer via a cash purchase or their bank financing. This is completely legal, though the mechanics may need to work slightly differently depending on where the end buyer is bringing their funds from.

In many cases you can easily close both ends of your deal within three days often even on the same day. However, in circumstances when the end lender wants to see the recorded deed from the first transaction you may need to wait as long as a couple of weeks. Thankfully the best transactional lenders are now rolling out extended financing options that can give you as much as 40 days to re-pay the loan.

So yes, transactional funding is completely legal and above board, though if course as always it helps to use a title company or closing attorney who is comfortable with this type of real estate deal, knows how to facilitate a smooth transaction on both ends and is familiar with how different lenders require things to be done.
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How Tough Is It Really To Find Transactional Funding These Days?

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on Friday, 24 June 2011
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A few years ago during the big boom in the housing market it was only the real pros who could get access to transactional funding and you often had to be pretty well connected to be able to take advantage of it. However, you could say that the one great thing that has come out of the recent rise in foreclosures is that transactional funding has actually become much easier to get your hands on.

Some people confuse transactional funding with hard money lenders and private mortgage lenders, however it is actually very different in some ways. No doubt everyone has learnt that hard money lenders have become far more cautious and strict on the loans they make than a couple of years ago. It used to be that providing you had a pulse and there was equity in a property that you could get a loan. Today these hard money lenders are often offering very limited LTVs and even require credit reports and proof of income and assets in many cases. This makes it a lot more like trying to jump through the hoops of a conventional mortgage lender or bank than what hard money was designed to be like.

In contrast transactional funding couldn’t be easier to get. You need to be aware that this is not a form of financing that works for those with buy and hold strategies, but it is perfect for wholesalers and those focused on flipping houses. Transactional funding is specifically for those who already have an end buyer and simply need the funds to close on the A-B transaction first.

What do you need to qualify for transactional funding? Virtually all you really need is your purchase contract and your sales contract with proof that your end buyer has been approved for a loan or has the cash to buy the property. There are no appraisals needed, no income and asset verification or credit checks. It is really that easy and you couldn’t ask for a better way to keep a steady stream of deal flowing.
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Real Estate Investor Makes $1 Million Dollars A Month With Transactional Funding

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on Thursday, 23 June 2011
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Looking for a little inspiration to take your real estate investing to the next level and want to know how the pros are really able to make so much?
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