Almost all professionals sometimes consider ‘moonlighting’, as an option to make some extra cash. However, in the real estate business, this would mean making appointments and a bazillion phone calls and doing everything in your power to meet them during your evenings and weekends when you should be resting and getting ready for the next day at work.

Since this is twice as hectic as compared to most moonlighting opportunities available, this is why most people in the real estate business suggest that you do not try it.

Here are some reasons why:

1) Most brokerages do not employ people part-time as they think that freelancers will not be able to keep with the latest legal developments in the industry which is crucial to avoiding mistakes that can lead to legal complications.

2) The real estate business is a complex one, where every real estate agent learns something new every time a deal is made. Since part-timers only spend half the time, this means that they have half the opportunities to learn, and therefore, might not be able to keep up with the fast-paced demands of the industry.

3) Since clients need to reschedule meetings at different times in the morning, afternoon or evening, working part time only narrows the timeframe within which you can meet clients, due to the demands of your day job. Needless to say, this is a big disadvantage.

However, if you’d like to work as a real estate agent with money not necessarily being your only motivation (which means taking on just a few clients) like housewives, retired folks and school teachers who have their summer vacation, then it wouldn’t be too bad an idea.

To most folks, inner financial peace means a lot and therefore one can opt for refinancing even when the conditions are less than ideal wile making deals with mortgage brokers who are not necessarily honest. Of course, not every one of them are like this, so it is important to know who you are dealing with before signing anything or paying any kind of upfront fees (in the case of foreclosures).

However, here are a few things that you can consider before trusting anyone completely in matters of refinancing:

1) Understand why you are refinancing your mortgage.

Mortgage brokers and banks will always be biased to their products/ clients even these options may not work out to your advantage, but theirs in terms of commissions. So it is obvious that the loan they are offering you is their best interests and not necessarily yours. Just remember that there are always pros and cons to a refinancing loan, and it is in your best interests to check their loan offers with a trusted financial advisor.

2) Adjustable Rate Mortgage

Most folks would opt for an ARM type loan that might help meet your short-term needs in terms of cash flow. However, even though your monthly payment can drop in opting for one these loans, it will be hard to handle when the rates increase after the low-rate introductory period is over.

3) Numbers, numbers, numbers

One should consider several factors before opting for a refinancing loan apart from the old approach which was taking a refinancing loan if the rates dropped at 2 %. Three factors such as prepayment penalties, closing costs and fees of a new loan as well as property tax should also be taken into consideration before going for a refinancing loan.

In determining the value of any property, it’s obvious that the location of the property matters. However, in addition to that, there is another factor that is in the form of zoning laws and ordinances that define and restrict how you can use your property.

This is done in order to ensure that the land, no matter how big or small, is used for the collective good, and thus these developmental standards are set, so it important that if you are working with a builder, or intend to become a land developer or an investor yourself.
Some of the classifications for land use in general are:

1. Residential
2. Mixed residential
3. Mobile home
4. Commercial
5. Shopping center industrial
6. Office
7. Conservation

As most folks have a particular reason for buying a property which could involve building property that could any one of these classifications, it is important to first check with the zoning laws to see if they match your purpose for that property, by gaining access to a zoning map or zoning planning documents that is made available at your nearest county office or the local town. In most cases, these documents will have a legend or reference information that will explain what each zoning type in the area will allow.

These documents (with the zoning laws) also provide further information regarding standards and requirements that must be adhered to such as the minimum lot size and width, building coverage, height restrictions and dimension of setbacks.

So, if you own property in the ‘zone’ or are planning to make any changes, be sure to not omit this important step of checking the zoning laws as it will save you a lot of time, energy and frustration.

Almost anyone who is interested in investing in real estate and is just getting started will find that although it is one of the best ways to accumulate wealth, they often fail to understand the basics that will help them succeed.

Sources of information such as article in publications, books, real estate gurus do not necessarily provide accurate steps by which one can take little baby steps to making their first successful offer. Some real estate investors do not even know what questions to ask in order to get started. And can you blame them?

So, here is one of the simplest methods that one can use to determine his motivation, action and direction when starting a real estate business by asking the W-H questions.

Why
Understanding your purpose will help you go the distance when things are not necessarily hunky-dory financially or otherwise.

What
Among the several ‘what’ questions that need to be answered, determining what your goals, your criteria for buying property, techniques to locate good property investments and which methods will you use to determine optimal amounts in offers for properties.

When
Some important ‘when’ questions could include when will you buy your first investment property, when will you devote time and efforts to tasks in the investment process and when will you spend the time to study the amount of knowledge that is required to be successful in this business.

How
This one could begin with asking yourself how you will fund property purchases; find the information required to make informed offers, market your properties after the purchase and so on and so forth.

Where
This question could help you determine where you could have your office or education materials that you will need to study or answer to the questions you might have and most importantly, where will you find the help to run your business.

Who
This question might help you determine ‘who’ will be involved in the different aspects of the real estate business that you have in mind.

Looking at this list, there’s no doubt that there are a lot of personal questions to be answered before you go out looking for advice from experts and the like. Get started!

If real estate investors were asked to pick between traditional borrowing methods and hard money lenders, the latter would be their choice as deals in real estate often occur in a short period of time leaving the former as a method to obtain funding. If the investor does not have a decent credit standing, this does not help his ability to borrow money from banks even when a deal does not have to be closed on a tight deadline.

So, for all practical purposes, keeping a list of hard money lenders is the best thing you could do when it comes to the financing the purchase and rehabbing of real estate properties. Actually, if one carries a pre-qualification letter while visiting real estate agents who are dealing with distressed properties that are owned by financial institutions, your offers will carry more weight as opposed to those who do not do this.

Most real estate investors do not necessarily have cash with them to buy property that you are offering, so if you do have a list of hard money lenders, you can point them in the direction of obtaining that money while also selling them the property.

However, for this to really work, one must scrutinize their buyers and their ability to pay mortgages on time and at the rate specified before referring them to the hard money lenders that you have in mind. If you can do this successfully, you will have a lot of investors who will be interested in buying from you because you not only have the property but also sources of money that they can borrow as well.

Perhaps you’ve been interested in having a real estate business of your own but without the resources that normally associated with it such as good credit and large savings one might be discouraged to even try. However, it is not important for you to have these resources to get started in finding financial independence.

And your first step into real estate investing could start with pre-foreclosures. What this term signifies is the period between which the house on which the bank has filed initial foreclosure papers and the sheriff or trustee sale that is yet to happen. And if you think this is not doable, think again!

Reason #1: No one is making any payments on the house during this period, which can turn out to be a big advantage for even investors who are worried about holding costs.
Reason # 2: Since this is a very well-defined market, just by focusing on conducting adequate marketing campaigns and following through on standardized processes can ensure that deals are closed, with you smiling your way to the bank.
Reason #3: Talking to sellers who are losing their home and need to get the banks off their back can help you get a good deal on the house and is not as difficult as you think.
Reason #4: Buying these houses helps you to create large equity spreads.
Reasons #5: Large discounts can be negotiated since lenders would rather liquidate the loan rather than repossess the property.
Reason #6: Getting bank financials normally for property discourages people to buy property but with pre foreclosures no qualifying is needed as you just take over the financing in place, while enjoying all the financial benefits as well.
Reason #7: You won’t have to maintain large reserves in cash in order to bid at the auction, as you would have bought over the house long before it even happens for discounted rate.

Most folks who are starting off in the real estate business would know that hard money lenders are often the best way by which one can obtain finance for a short term investment property. And if you are familiar with the terms ‘flip’ and ‘rehab’, you’d understand that capital that has to be raised quickly are only possible if one can find a hard money lender. So, the obvious question is: Where can I find hard money lenders?

Here are a couple of places and people that you can ask:

1. Settlement or Closing attorneys who normally prepare documents for hard money lenders. And in some cases, these attorneys are hard money lenders themselves.
2. Accountants are also a good option as most of their clients have money, and need their advice to know what to do with it.
3. Mortgage brokers can provide you with leads to find a hard money lender as they work with investors time and time again.
4. Make a list of homes that are undergoing renovation and then a little trip to courthouse will help you track the money lenders involved with these projects. At least one of them will be a private lender.
5. Agents who sell hazard insurance policies particularly with investment properties, and since they know who the ‘loss payee’ is (the lender), they should be able to give you a few tips as to the names of some of these private lenders.
6. And the easiest of the lot: look on the internet for your county’s and secretary of state’s records of houses that were sold by banks to private investors, not individuals but corporations or partnerships. You can easily take it from there.

In the business of providing loans to people, you can always take the easy if you have good credit, or you can take the hard way by availing hard money loans that are given out a much higher interest. Just from this statement, any one could tell that this has nothing to do with banks that are very careful when it comes to giving out loans according to government regulations.

For one, hard money lenders are actually private lending companies that offer a specialized type of real-estate backed loan. What this means for its user is that these short-term loans require collateral (usually in the form of real estate) to insure the loan just in case something went wrong. So, the amount of the loan is only based on the current value of the property, and no more.

And if that’s not enough, hard money lenders charge a higher rate of interest as opposed to federally regulated banks, which has an upper limit that has been set to protect the consumer. And it is here that the risk is, as once the customer defaults, the rate of interest can go up to atrocious levels with no protection from the government or laws that have been put into place.
In some cases, rather than funding the business or individual with an upper-limit of 65% of the property value, one can also include the business or personal assets in order to get more funding. Therefore, some borrowers add additional property to increase the value of the loan, which is known as cross-collateralization.

In a dog-eat-dog world, due diligence is crucial to a successful real estate business which involves investments. Very simply, the definition of due diligence is ‘the investment and verification of certain details of the investment’ in question.

This can be done in several ways, and of course with some of the old players, this is done by running around looking for information that could either damn or support the investment. Normally, how one conducts due diligence before purchasing a property is by looking at service contracts and agreements, verifying income such as rental histories, calling local authorities to check for any record of violations as well as doing an exterior and interior inspection of the property as well.

But with the internet, information that could take ages to gather only requires a few minutes of searching from the real estate investor’s point of view, especially in state in the US where property tax rolls are online.

If you do intend to run a search using this method, you will find that sites contain information such as property, ownership, sales, tax assessment, environmental, economic, crime and demographic records.

Now there is also a checklist that one can use to complete a thorough ‘due diligence’, and here are some of the things that you must look for such as Property records, Property tax records, Comparable sales, Neighborhood crime, Flood zone map, Hazardous waste, Demographic and economic data and Code violation search.

With information on all these factors available on the internet, one can accurately determine whether or not the property he/ she intends to invest in is truly worth the money or time.