How to Buy More
Than Four Properties When Investing in Michigan Foreclosures
Michigan foreclosures have pressed down real estate values in Metro
Detroit for over 4 years in a row. The silver lining to these skidding
values is that investors now recognize that prices for investment
properties have never been more attractive.
So why aren't more people snatching up houses at rock bottom prices
like a kid on a Toys R Us shopping spree?
Well when they take the next steps to transforming this dream into
reality they find out that most mortgage lenders currently will not allow
you to have more than 4 mortgages to your name if you are applying for
another. When translated, this means that you can only have 3 additional
mortgages on your credit report if you have one on your primary residence.
You would think that people would go out and get their four properties,
maybe even have their spouse get another four too. Instead we see people
deciding that if they can't buy ten next month in their own name, they
won't get involved at all.
I know a lot of people that are buying Michigan Foreclosures and are
using creative strategies to work around the 4-property and high-down
payment obstacles. Here's one that works well.
Use commercial funding to refinance your investment properties. If the
properties were bought right with significant positive cashflow, then it
shouldn't be too difficult to package three rented homes together into one
commercial loan. This frees up the funds that were used to acquire the
property (either from a line of credit, straight cash, or other sources)
so they can be re-invested in purchasing an additional three properties.
Commercial loans are different from standard mortgages. They often come
with 10 year amortizations and have to be refinanced every five years and
because of that it's usually best to select the right type of investment
homes that have such a high cashflow rate that they can account for it.
This translates into buying very inexpensive properties. Houses that
can be bought and fixed up for $30,000 or less and will rent for $750-$950
per month match up well to being rolled into commercial loans.
This is why smart real estate investors from across the nation are
turning to Michigan foreclosures and properties in other areas that can be
had for a bargain price. The financing is still there to keep buying more
properties while prices are at record lows. Even after the published
declines brought on by the credit crunch and mortgage meltdown, other
markets on either coast as well as Florida have values averaging well over
$150,000 which don't mesh well with commercial financing.
So if you want to buy a lot of properties at great prices that cashflow
well in a short amount of time, then real estate investing in Michigan
foreclosures is the way to go.
Michigan foreclosures bring a unique benefit not found in other real
estate markets...namely that homes can be bought at such low prices, but
they still command high rents.
Further more, with new methods to collect rent automatically each month
and great property managements companies to take care of the occasional
leaky faucet; it's easier than ever to invest from afar.
Do some research and I'm sure you'll agree that Michigan foreclosures
may be just the type of alternative investment you are looking for. It
might even be able to help you turn around the losses the stock market had
dealt to your other investments and get on track where your finances and
retirement goals are concerned.
Brian Kurtz is a licensed Realtor who invests in Michigan real estate
and shows people nationwide how they too can take advantage of the unique
Michigan foreclosure market without ever leaving their own home town. Sign
up for Brian's Hot List of wholesale investment properties at
http://www.PremierRealEstateInvesting.com
Article Source:
http://EzineArticles.com/?expert=Brian_Kurtz
http://EzineArticles.com/?How-to-Buy-More-Than-Four-Properties-When-Investing-in-Michigan-Foreclosures&id=1899875
Free Foreclosure Listings |