Now let's look at some tips on how to invest in real estate

Should you invest in real estate?

It is a good idea you own one home first before you start investing in another property to earn money. Financing and mortgage I think is one of the most evil things created in the finance and real estate industry. Buy houses for cash, and buy house by owners as you can avoid paying fees and commissions.

Once you own your first home, you will probably want to get another house. It is a great opportunity to make some money and have along-term investment. Because housing market is in shit right now, it is a good time to cash in on foreclosed properties. Don't let the economy scare you. Be confident in what you are doing because real estate prices will bounce back today or tomorrow, it doesn't really matter as long as you can get a good deal.

Although financing isn't that easy like it used to be, you still can get a mortgage if you don't have the cash for it obviously. Interest rates have been dropping to promote the economic bounce-back, and there is a lot of expectation that it will continue dropping. Since foreclosure rates are going up, the supply of houses increases and drives housing prices down.

Finance Smart!

Once you decide to invest your money in real estate, your first objective is to figure out to finance foreclosed property that you put your eye on. The problem here is not like with any other business. You can't buy a house and expect to resell it at a higher rate right away.

Make sure you know your clear goal and expectations from the property. Answer these two following questions first:

1. Do I want to keep this property as a long-term investment and rent it out?
2. Do I want to flip this property and make some cash fast?
   

In the second case, get an adjustable interest rate mortgage, find your buyer, and sell your house fast! The reason you want to get adjustable interest mortgage rate is that for a long-term investment it will create a lot of problems (like what we are experiencing with our real estate market now). But if you are confident that you will flip the property fast and find the buyer, do it before mortgage adjusts! Make sure you pay only interest, because then the buyer will be responsible for it when the buyer buys house from you.

For longer-term real estate investments, fixed mortgages are better because they allow you to plan your cash flow accordingly and get by when things are tougher.

Here is just a list of some banks and companies that you can apply for mortgages:

www.LendingTree.com
www.QuickenLoans.com/Mortgage
www.mortgage101.com
www.mortgage.com
www.mortgage.chase.com
www.MortgageLocators.com
www.wellsfargo.com
www.usbank.com
www.suntrustmortgage.com

***I really have no idea which one to go with best, just try to look around for the best deal

When you buy your property and plan to subsidize your mortgage with rent money, make sure you don't spend a lot of money on remodeling because tenants will mess it up anyways. If you have a rush to pay off your mortgage go ahead and pay it off. But really there is no point to stress about your mortgage, because your tenants are paying most of it and so you won't have to worry about making those payments. If you are an aggressive investor, go ahead and pay your mortgage off and then enjoy rent money. If you have a rental property, make sure you are also leveraging all of the tax benefits of depreciation and expenses.

Do it yourself where you can, and save yourself some bucks!

When you made your real estate deal, you may have made $20,000.00 dollars but paid an attorney $2,000; $7,000 to a contractor for remodeling and fixing; your real estate agent took $6,000; your attorney took $3,000, etc etc. and you end up not making anything or even loosing!



Take a look at this property here:

Remodeled Suburban Home in Toronto for resale

When you end up buying your real estate property, improvements can really add some value to your property and benefit you in many ways. New cabinets, landscaping, tiling, furnishings, etc. are among and part of interior design additions that will help your property gain some value. Hire contractor only if you need it. if NOT - DO IT YOURSELF!!!

You can change locks, plant plants, painting, etc. are things that you could probably do yourself. But don't be stupid! If you don't know how to do sheet rock - DON'T DO IT! You will waste time and money yourself, and then you will end up hiring a professional again. It will be quiet astonishing to see how much you can save by doing things yourself. If you really feel like you are helpless in this stuff, make sure you budget the right amount and do not go over. Real estate is tricky, don't get caught in your own mess.

One last thing - Know your market!

Sometimes it may feel that you are on top of things, but later you will find out that real estate is extremely competitive and difficult to survive in. A lot of guys out there have in this business far longer than you have, and they can squeeze you out of business just with a snap of fingers - watch out! Do price research, look up classifieds, property listings in your area, estimates, projections, you can save a lot money doing this. The more you know, the better deal you can negotiate. Knowledge prevents you form under-pricing or overpricing - so do your research!