How you can use Rehab, Refinance and Cash Out as a long term wealth building Real Estate Investing strategy.

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Today we are discussing a somewhat advanced strategy for you to use after you have been in the creative real estate investing business for a while. I call this “Rehab, Refinance, and Cash Out”. This strategy can lead to true long term wealth and financial independence. This works very well in a buyers market like Memphis where prices have been quite flat for some time. You need to use this to augment your wholesaling for immediate income and retailing for bigger short term profits. Rehab, Refinance and Cash Out is a long term wealth building strategy and will be something you will be glad you did as it is a long term buy and hold strategy, and those are the strategies that lead to true wealth accumulation and financial independence. Let me explain how this works. You find a good middle to low end 3 bedroom home that you are able to buy from an out of state owner or other motivated seller that needs a little work and you buy at 60% of after repaired value. You buy the house using a hard money lender like http://www.pleaseclose.com/memphistrading and do your fix up and have a property management firm manage the property and put a renter in the house. The hard money lender will typically loan you up to 65% of the after repaired value to purchase the house which you use to buy the house and then repair it. Now that the home is repaired you obtain an investor friendly mortgage and cash out by refinancing at 80-90% of after repaired retail value and you should be doing this with properties where this strategy gives you back at least $10,000 at the refinance that you can use in your business any way you need. Do not use this money to live on, use it solely to grow your real estate business. Once you have done this strategy on 10 homes you should be able to keep finding better and better deals because you can close quickly as you have cash in hand to make things happen. More cash equals better deals and more opportunities.

By the time you repeat this strategy 20 times you should have at least $200,000 cash plus about $200,000 equity and 20 homes giving you at least $2000 per month positive cash flow whether you decide to work this month or not since you have a property management company handling things for you. With average annual rent increases, within five years that $2,000 a month should grow to $4,000 a month. In 30 years you should have $2 to 3 million plus in paid off real estate. It’s a good solid long term strategy to add to your immediate selling from wholesaling, retailing and lease options that the extra $200,000 in cash will help grow tremendously.

The rent minus the management fees and all loan and other costs must leave you with positive cash flow or this strategy should be avoided. If you cannot cash out on the property I don’t recommend holding it long term as you want to be able to use your best mortgages to cash out.

You can purchase using http://www.pleaseclose.com/memphistrading if your Equifax credit score is above 550(which is bad credit) or you have a co-borrower who has an Equifax score over 550. A good investor friendly mortgage company will give you good rates if you are at 660 middle score or above and the very best rates if your middle score is 720 or above. Your first 10 investor mortgages in your name and 10 in your spouses name are the easiest to qualify and get the best deals. After those you really need a good investor mortgage company to work with. Take the time to find the real investor friendly mortgage companies that can help you get loans for 100 properties and not just the first ten and let them have the easy ones and the tougher ones. I do recommend having more than one good lender available though, but stick to the ones that specialize in investor loans. Find out from other investors who the most investor friendly mortgage companies are to use to refinance the repaired home.

I do not advocate becoming a landlord as I do not believe this is a valuable usage of your time and energy. I highly recommend asking around and finding a good property management company that will charge you 10% or less to start out with and gradually lower that % as you add more and more properties.

I feel this is an advanced strategy as you won’t see any cash in your pocket from this strategy for 4-6 months after you find the deal which is a long time to work and not see any pay. If you are wholesaling and making consistent money each month then it shouldn’t matter. This strategy will magnify the profits you make in your investing business in ways you might not have imagined. This strategy is a natural progression from wholesaling as you are already helping others find these kinds of deals, now you will be able to get the cash out typical of probably 2 wholesale deals, just paid slower, and at the same time building a nice future nest egg.

About the Author

David Neese is a real estate investing author who offers a free course for real estate investors delivered by email, audio and teleseminar which you can get for free at: http://www.FreeRealEstateInvestingCourses.com You can find more information about David at http://www.DigitalSuccessCoach.com

7 Reasons Why Newsletters Get Good Real Estate Leads

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Newsletters are publications issued by a specific real estate firm or real estate association geared towards a specific readership population, of a certain State, buyer preference or for the general real estate consumer. Such publications contain various information about the industry and its related fields, as well as about new products and services that the specific firm or association is promoting. Here are the top seven reasons why you should use the real estate newsletter to find good real estate leads.

1. Free Information

Newsletters are free. For that reason alone, active real estate buyers and investors should be on the mailing list of major real estate firms and associations. Most newsletters will definitely have sections on “free tips” in the intent of firms to show that they have a genuine concern to help consumers and in a way, demonstrate their company’s expertise in the field. Such free articles are also a way to attract readers, and get them hooked to read on to the sales pitches, which is the primary intent of issuing the newsletter. Nevertheless, anything that is free and informative at the same time should always be the searcher’s first stop.

2. Credibility

In general, newsletters have more credibility than the usual ads. The real estate firms that publish newsletters use it as a venue to establish their company’s leadership and authority in the profession. Thus, they most likely will publish reliable, well-researched and relevant market information, geared towards the benefit of the consumer, in order to maintain their credibility. Get historical real estate market trends, sound predictions and reliable leads through information in the newsletters.

3. In-depth Information

Real estate newsletter articles provide more in-depth information than real estate ads. The intent of real estate newsletters is to have a venue to better educate consumers about real estate details that are not covered in advertisements like construction quality assessment, safety, after move-in support, etc. Having such information will allow you to look into more details about the property that you intend to buy.

4. Financial Information

Aside from real estate leads, newsletters also provide other information that are related to the industry. Financial information such as mortgage rates, mortgage calculators and bank or lending institutions contact information are among the additional information that you can get from a newsletter. Occasionally, real estate newsletters will publish full-length articles on financial information such as “How To Compute Amortization” or “The Benefits of Refinancing.” Watch out for those articles and make sure to clip them for future use, unless you are into the habit of compiling the newsletter itself.

5. Locations

Aside from financial information, real estate newsletters also feature full-length articles and facts on hottest real estate locations as well as uncharted lands that have yet to join the boom. Depending on the profile of the property you intend to buy, such information will be beneficial for your search.

6. Seminars and Viewings

Information on real estate seminars and property viewings are also in newsletters. As a buyer, this is your opportunity to have first-hand experience on the property or the real estate firm without any financial commitment from your end. Most seminars and viewings are free, transportation and meals included and at times, discounts are handed out for the select who signed up. Now that’s one opportunity you should not pass up!

7. Testimonials

Testimonials are an essential part of real estate newsletters. Use such actual consumer experience to understand the capabilities and extent of service of the real estate firm. If, based on the published first-hand experience by actual customers, their profile or the rundown of their properties fit the portfolio of service you are looking for, then the company should be able to support you and give you good leads.

Modern day newsletters are already issued electronically; the e-newsletter, sent via e-mail or downloaded from the publication’s website, but offers the same useful real estate information without the hassle of piling paper. Whatever form you prefer, real estate newsletters are definitely promotional materials, but are of the informative kind. As a consumer, you should take advantage of all the available information, which can help you in the search for real estate leads.

About the Author

Jay is the web owner of http://www.homes-in.net/Illinois.html Homes In Illinois, a website that provides information on real estate buying, negotiating, financing, and more. You can also visit his website at: http://www.real-estate-in.net/Illinois.html Real Estate In Illinois

Hope Ranch Real Estate through time……

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The first mention of Hope Ranch was in 1769 when Portola wrote about it in his diary. He was greeted by the Canalino Indians which were somewhere between where Modoc and US Highway 101 currently run. The Canalinos had been there almost 10,000 years at the time and we’re probably pretty surprised to see Portola.

The first time somebody actually owned Hope Ranch was in 1843 when Lt. Narciso Fabregat of the Santa Barbara Presidio was given the deed to the ranch. The grant was known as the “La Calera” (The Line Kiln) and was used by the Mission fathers to make mortar for building the Mission. The kiln was located on what is now Las Palmas, the main entrance of Hope Ranch

The first Sale of Hope Ranch Real Estate occurred in 1861 when Thomas Hope purchased it from Mrs. Robbins (not Robinson) for the princely sum of $8,000. The area reminded Mr. Hope of his native Ireland and the first thing he did was drive a flock of some 2,000 sheep across his new possession into Santa Barbara. The sheep went forth and multiplied up to about 5,000 and provided the wool needed for soldier’s uniforms during the Civil War. This made Mr. Hope a very wealthy man.

Because of his prosperity in selling wool Mr. Hope decided to build himself a very spiffy home. Peter J. Barber designed what was called “The Mansion.” This home located on Nogal Dr across from the Vieja Valley School cost $10,000 and was completed in 1875. Today it’s a County Landmark listed in the National Register of Historical Places

In 1873 Thomas Hope gave the county a very cool 120 foot wide strip of land to be used for a road. This strip which became Hollister Avenue went all the way up to the current Turnpike Rd.

In 1887 after her husband’s death Mrs. Hope sold the western half of “Las Positas y La Calero” as Hope Ranch was called in those days to the Pacific Improvement Company. The company had some illustrious members including Mark Hopkins, Charles Crocker, Collis Huntington and Leland Stanford. The sale was for $250,000 which was pretty good for a $10,000 investment. But Hope Ranch Real Estate has usually been a good investment.

The Pacific Improvement Company didn’t improve much, but there was the Potter Country Club, on the site of current La Cumbre Country Club which got laid out and lots were offered for sale. Unfortunately sales weren’t too brisk. But in 1923 along came Harold Chase who purchased the easterly 825 acres of the Ranch and started Santa Barbara Estates, Inc., and we were off to the races.

Mr. Chase organized a second syndicate called La Cumbre Estates, which purchased the 1200 acres of Las Palmas and Robles Drives which united Hope Ranch under one control. The installation of roads, utilities and bridle paths soon followed along with an increase in the water supply.

The first homes in Hope Ranch were constructed for the directors of the La Cumbre Estates Corporation. Mr. Chase’s home was called “Las Terrases” and was completed in 1925. Then Peter Cooper Bryce built “Florestal” as well as the Wilson and Dickenson homes. Falling under the category of, “I shoulda’ bought then,” home sites originally went from $100 to $2,500 per acre. And to purchase these sites the terms were One-quarter (25%) cash at time of purchase, with the balance to be paid within three years at 6% per annum of deferred payments.” (Still not too bad an interest rate) Currently there are 686 residences and there are about 18 vacant lots still available for development.

The highest priced sale for 2005 has been $7.75 million and the least expensive sales this year was $1,875,000. Some of the properties currently available are:

* 4Bedroom 2.5 Bath home for $2,495,000 * 4 Bedroom 5 Bath property for $2.975 million * 3 Bedroom 4 Bath home for $4.195 million * 5 Bedroom 5.5 Bath property for $8.795 million * And the highest priced listing currently on the market is 5 Bedroom 5 Bath home for $21.5 million

Well that’s about it for now for Hope Ranch Real Estate

About the Author

Gary Woods is a Realtor in Santa Barbara and is the trainer for the Santa Barbara Association of Realtors. You can hear Gary on Radio 1290 AM Mondays from 9-10AM.