We are, at the time of this writing, approximately 10 years or so from the 2008 financial crisis, a crisis that was primarily created by the proliferation of low quality real estate loans. Underwriting standards were reduced to the extent that just about anyone with a pulse could get a loan, with no other qualification needed. “Liar Loans” or NINA loans (standing for No Income No Asset Verification needed) meant that someone working at a $10/hour job could get a loan to purchase a $700,000 house, even though based on the borrower’s assets and income they had no way of affording the payments on that loan. Through complex structures of debt securitization created at the top levels of Wall Street banking firms, these loans were then packaged up and resold to other investors as completely safe assets, even though they carried a huge risk of default. That ultimately led to the near collapse of our financial system and all the repercussions that came with the recession that followed. In the wake of the financial damage that ensued, lawmakers saw to it that many new regulations were put into place so that the same kind of loose lending could not continue and put us in a similar situation again. Borrowers had to meet stringent underwriting conditions and be well qualified based on income, assets and credit scores. The pendulum may have actually swung back too far, and there are good arguments as to why some lending programs that had previously existed might be brought back to a limited degree. But there are other areas of the economy where subprime style lending has grown again - in the auto industry, student loans, and in something related to housing through the PACE (Property Assessed Clean Energy) financing options. The program began as a way to allow homeowners to finance clean energy upgrades to their homes. There are limited qualifications needed, so someone who would not qualify for a regular loan can qualify for this financing. And one of the more interesting aspects is that the loan is paid back through payments attached to the property taxes for the property that was improved. Attaching itself to the property taxes puts these loans in a 1st position above all others, effectively allowing them to leapfrog over any existing 1st lien loans that may already exist on the property such as the loan that may have been used to purchase the property. Banks and mortgage lenders are most likely not going to be fans of these loans as they reduce their security interest in the property. Some things to be aware of is that these loans carry a higher interest rate than you would typically have on your other mortgage financing. As these loans have proliferated and people are more aware of them, they will likely be required to be paid off if you choose to sell your property, as new buyers or lenders are not going to want to assume liability for these debts. Since they are paid through your property taxes, it is easy not to notice the loans at first - it may be months before you will have to make the first payment since property taxes are only paid twice a year. Your property tax payment could jump dramatically higher depending on amount of the loan you get. For some more perspective on these products here is a story published by the L.A. Times on the matter: https://www.latimes.com/business/la-fi-pace-loans-20170604-story.html Bottom line is to be aware of these programs and take time to review all the terms and conditions before you jump into something like this. The contractors selling their services and the financing along with them may be genuinely trying to provide a good service, but they will not know your overall financial situation and may not take the time to learn enough about it. Calculate exactly how much these payments will add to your annual budget and make sure you can comfortably afford it. And be sure to read all the paperwork and fine print before committing to one of these loans, so you don’t end up in over your head.
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Real estate investment is an excellent way to improve your financial life. No matter what stage of life you are in, you can get started. Whether you have a lot of money to invest or just a little, there are ways to make your real estate dreams come true! Learn more about how to do it in our latest post!
It has been said that most of the world's millionaires got that way through real estate. Real estate investment brings solid returns and should be included in any investment portfolio. When you are ready to make a move to level up your financial life, real estate investment should be one of the first places you look! Where to Begin Making that first investment might be one of the most difficult moments in your investment career. Like a bird jumping from a branch for the first time, an investor making his first purchase must have confidence in their preparation and their ability to safely land. Before making any investment purchase, you will want to have done your own independent research. Study the market, similar properties and look for a mentor you can shadow to learn the ropes first-hand. Knowing Who To Trust When investing in real estate, you will meet a lot of people who want to do business with you. Whether you are buying or selling, it can be difficult to know who to trust. Make sure to do your due-diligence. Make sure this person doesn't have a history of bad deals or unsatisfied customers. It can be very beneficial to make strong contacts, creating a circle of people you can trust. Within this circle, you will want to include a CPA, a lawyer, an agent, and ideally a mentor who is experienced in real estate investing and can help show you the ropes. There are many great resources to learn about real estate investing today including websites such as Bigger Pockets or local real estate investing clubs - you will likely be able to find one in your area if you live in or around a large city. Leveraging What You Have Once you have your foot in the door, it is time to start building... figuratively, and quite possibly literally. You can start small, and over time, turn it into something much, much bigger. Maybe you purchase a piece of land, and sell it for a profit, and reinvest that in a small home. You take the rental proceeds you receive from the home each month and invest with others in a shopping center. You get the idea. It is all about taking your initial profits and building from there. Using Other People's Money When you own investment real estate, you are, in essence, using other people’s money to facilitate your investments, very often via a loan from a bank. You can collect tenants’ rent each month which will pay for the mortgage on the house and quite possibly have some cash left over to put elsewhere. You can also pool your investment with others to purchase something you might not have been able to do on your own. Giving Back Once you have achieved success in real estate investment, one of the most enjoyable things you can do is to give back to other "green" investors who were once in your shoes. There is enough to go around for everyone and by sharing what you know, you help pass down the dream of wealth through real estate. Take Action You need to spend some time learning and studying about real estate and you don’t want to jump into anything too quickly. But you also don’t want to get stuck in “analysis paralysis” and spend all your time trying to learn about new things without taking action steps along the way. The best way to learn is by doing, and finding ways to take small, actionable steps frequently. Your knowledge will soon grow and you’ll be on your way. So don’t wait any longer - go out there and find an action that you can accomplish today! Joe recently found out his uncle had passed away. The uncle was not a blood relative but the husband of his aunt, and they had later divorced. Though he had fond memories of visiting his uncle when they were young children, he had not heard much from him in years, and was surprised to hear of his passing. An even bigger surprise was finding out he and his brothers were the beneficiaries to his uncle’s will. What he had never known was that his uncle did not really have any other family he wanted to include in his will. A Benefit Becomes a Problem While it was a pleasant surprise to find out he was inheriting a house, that surprise turned to shock when Joe got to the property. His uncle had in fact developed into a true hoarder in his later years. The house was almost impossible to walk through - stacked to the roof with piles of stuff. The trash was one thing, but it was compounded by the complete lack of maintenance the house had for years. The roof was falling apart and leaking like a sieve. The ceilings were growing large dark circles of mold from the leaks in the roof. The bathrooms and toilets were not functional, and the sizable back yard had turned into a jungle. What was thought to be an economic benefit now looked more like and economic liability. It would take hundreds of thousands of dollars to restore the house to a livable condition, money he was not prepared to spend. This was compounded by having to go through the probate process which added additional costs and time to the whole ordeal. Joe was also concerned because transients had been breaking into the house since it had become vacant. He did not have insurance on the property and was worried about the added liability of a property in such poor condition. A Solution Emerges Fortunately, Joe found a convenient solution - selling the home to a real estate investor. He was able to sell the home completely as is, without having to spend any of his own money to fix up the house. He converted the equity in the home into cash he could use quickly and easily, and was able to move on with his life. Bright Idea House Buyers can help in just such situations. We buy houses as is, in any condition, and offer a quick and simple solution to your real estate problems. Give us a call today at 424-625-7026. Do you have unpaid property taxes in Los Angeles, Orange, San Bernardino or Riverside Counties? If so, the consequences can be very difficult to deal with. In our latest post, we will help you learn more about what's at risk and the solutions available to you! Depending on where you live, the size and value of your home, property taxes can become a huge burden. Once you get behind, the penalties and fees will start compounding, making it even more difficult for you to get out of the hole you are in. What are the consequences? The worst case scenario? You could lose your home. After a certain amount of time, the property can be put up for public auction by the county. Properties are auctioned off to the highest bidder to cover the taxes owed as well as any penalties and fees that have accumulated along with the taxes. What Can You Do? There are a few things you can do when you are faced with unpaid property taxes. You can pay them, have them lowered or work with a buyer who is willing to help you out of the hole you are in. Nobody wants to lose their home, especially to a complete stranger. Before your unpaid property taxes get out of hand, do everything you can to resolve the situation. Pay Them Off You can pay them back with the help of a loan. While this might seem like you are replacing one debt with another, having the peace of mind that you aren't going to lose your home, sometimes makes it worth it. Keep in mind, you will also likely have fees and penalties that have been added on to your original debt. The entire amount must be paid off in order for the county to remove the lien on your property. Try To Get Them Lowered You can choose to reach out to the property appraiser to have your property reassessed. Examine your tax bill and the amount you have been assessed. If you feel that they have the information on your home incorrect or that the amount you are being assessed is too high in comparison to other homes in your neighborhood, you might be able to secure a lower assessed value. Getting them lowered isn't always easy. Make sure you have accurate and up to date information about the homes that have recently sold in your area. Work Out a Payment Plan You can often work out a payment plan with the county to pay the back taxes over time. This can help them be more manageable especially if the back taxes owed amount has grown to a very large number. Sell the House If there is equity in the property and selling it is an option, this may be an easy way out. Selling the house will allow you to use the value in the property to pay off the taxes and not potentially lose out on some of that equity were it to be force sold by the county. Whatever you decide - don’t ignore it! It’s best to make a decision and deal with the problem head on. The first place most potential home buyers will start their search for a new home is online. Whether it’s on a well known real estate website like Zillow or Redfin, or even if it’s through local Multiple Listing Service links sent to buyers by their agents, the first place that buyers will start is by looking through the available photos of the home.
Dark, blurry or narrowly focused pictures will take away from the potential appeal of your home and may even push buyers to move on to the next listing without bothering to schedule a viewing of the house in person. In today’s short attention span world, people are quick to move on to the next thing. So how do you keep potential buyers’ attention focused on your beautiful home? Here are a few tips that will help. Make Sure the House is Clean Regardless of how good your pictures are, if you are taking pictures of a messy home there is not much you can do to cover it up. Unless there are unusual circumstances that would prevent it, a good cleaning can do wonders for any home. Even if the home is dated or needs work, starting with it clean will help. Light it Up Well lit rooms have more appeal than dimly lit ones. When you are getting ready to take pictures, turn on all the available lights and open the window coverings to let natural light in. Depending on the camera you are using, you may also want to add a flash to brighten it up more. A professional speedlight type flash is best, and it’s best to point the flash up as opposed to straight at the room so that the light reflects off the ceiling and diffuses more evenly throughout the space. Wide Angles If possible, use an extra wide angle lens on your camera so that you can capture the most space in the room. If you have a professional camera that can handle interchangeable lenses, this is the best as you can purchase a specially designed wide angle lens just for this. However, many of today’s newer smart phones have a wide angle lenses built right in to the phone which can also work. Try to position yourself in a corner of the room where you can capture most of the room in one shot and direct your camera towards the sides of the room that include the most features and appeal. Take a Lot of Pictures Don’t be afraid to take multiple pictures of each part of the house. While there may not be as much to show in a bedroom, in major impact rooms like the kitchen, living room and bathrooms it’s better to have multiple pictures from different angles to highlight all the features of each room. Think of yourself as a buyer of the house and if you were only allowed to purchase the home seeing pictures but never actually seeing it in person - would your pictures show enough of the home to make that possible? You want potential buyers to be able to imagine themselves in the home. You can also include detailed close up photos of features such as nice faucets or fixtures, tilework or other special details of the home that add appeal. Touch Them Up For professional photographers, taking the picture is the first step in the process, but a second step that many people never consider is the post processing work that is done afterwards to really make each shot look their best. Basic photography editing software is readily available these days, and it is even built in on most smart phones. While this will add an extra step, taking the time to play with some adjustments to improve the colors, brightness, contrast and other options can really improve the final picture. When you see professional photographs they are likely not just a photo straight out of the camera - running them through a post production process is a big step to making the photos stand out. Following these simple steps can greatly improve the photos of your home and help it to attract buyers and sell quickly! Of course, for a fast and simple sale that doesn’t involve having to take any pictures, Bright Idea House Buyers can buy your house in any condition, with a quick and easy fair cash offer! A "handyman special" refers to a property that needs some work in order to be livable. The term "fixer-upper" is so widely used, that it might refer to even the most run-down and damaged houses. In this article, we are discussing the pros and cons of purchasing a property that only needs a small amount of work. Learn more about what to expect in our latest post!
The idea of buying a property at a great price can be very alluring. Often times this is how people are able to buy their home well below market value! However, just like any other real estate purchase, there are a few things you need to be mindful of. Here is a list of pros and cons to help you make the right decision when buying a handyman special in Los Angeles: Pros A Better Price The biggest draw to buying a handyman special is the amount of money you can potentially save. When a house needs some work, the seller will usually be prepared to take a lower price. Depending on how much it will cost for you to renovate, buying a handyman special can be a huge opportunity to find your dream home at an affordable price. Especially if you have the time and know how to put in some of your own "sweat equity," you may very end up with greater monetary equity in the house once you have completed the needed work. Less Competition When it comes down to it, there are fewer people in the market for homes that need work. Most people don't want to add in the time and expense of making repairs on top of all of the other costs of moving and buying a home. You will likely have fewer people competing with you to buy the house, which in turn leads to more negotiation power and a lower overall price. Make it Your Own If the house needs some work to the kitchen or bath, it will give you the freedom to design things just as you wish. So not only will you save money when buying a home, but you will also get to pick out the tile and other fixtures too. It is also the perfect time to paint or replace the carpets... before any furniture is moved in. Many people buy fixer-upper properties simply for this reason: they are able to truly make the house their home. The Neighborhood of Your Dreams Maybe there is a neighborhood you have always wanted to live in, but it's just a little bit outside of your current budget. You can often find a handyman special in the area allowing you to buy a home in a neighborhood you want, at a much lower price should you have chosen a move-in ready house. Cons You Will Spend More Than You Planned For Well, most likely. It is smart to pad your renovation budget by at least 20%. You will inevitably encounter additional costs or find other things you want to fix along the way. Factor these "unexpected" costs into your renovation budget so you aren't blindsided or forced to live in a house that is incomplete. You Might Be In Over Your Head Sure, HGTV makes it seem easy. Jim and Susan find a dilapidated mess and 30 minutes later they are living in a dream home. The reality of it is that it is rarely this easy. Between logistical hangups, construction permits, problems with deliveries and issues with contractors, you might find that fixing up a home comes with its fair share of headaches. That said, if you are prepared for these things going into the sale, you will be able to save yourself a lot of time, money and frustrations. So is this a project you want to take on? Spend some time weighing out the options and maybe it will be for you! We are, at the time of this writing, approximately 10 years or so from the 2008 financial crisis, a crisis that was primarily created by the proliferation of low quality real estate loans. Underwriting standards were reduced to the extent that just about anyone with a pulse could get a loan, with no other qualification needed.
“Liar Loans” or NINA loans (standing for No Income No Asset Verification needed) meant that someone working at a $10/hour job could get a loan to purchase a $700,000 house, even though based on the borrower’s assets and income they had no way of affording the payments on that loan. Through complex structures of debt securitization created at the top levels of Wall Street banking firms, these loans were then packaged up and resold to other investors as completely safe assets, even though they carried a huge risk of default. That ultimately led to the near collapse of our financial system and all the repercussions that came with the recession that followed. In the wake of the financial damage that ensued, lawmakers saw to it that many new regulations were put into place so that the same kind of loose lending could not continue and put us in a similar situation again. Borrowers had to meet stringent underwriting conditions and be well qualified based on income, assets and credit scores. The pendulum may have actually swung back too far, and there are good arguments as to why some lending programs that had previously existed might be brought back to a limited degree. But there are other areas of the economy where subprime style lending has grown again - in the auto industry, student loans, and in something related to housing through the PACE (Property Assessed Clean Energy) financing options. The program began as a way to allow homeowners to finance clean energy upgrades to their homes. There are limited qualifications needed, so someone who would not qualify for a regular loan can qualify for this financing. And one of the more interesting aspects is that the loan is paid back through payments attached to the property taxes for the property that was improved. Attaching itself to the property taxes puts these loans in a 1st position above all others, effectively allowing them to leapfrog over any existing 1st lien loans that may already exist on the property such as the loan that may have been used to purchase the property. Banks and mortgage lenders are most likely not going to be fans of these loans as they reduce their security interest in the property. Some things to be aware of is that these loans carry a higher interest rate than you would typically have on your other mortgage financing. As these loans have proliferated and people are more aware of them, they will likely be required to be paid off if you choose to sell your property, as new buyers or lenders are not going to want to assume liability for these debts. Since they are paid through your property taxes, it is easy not to notice the loans at first - it may be months before you will have to make the first payment since property taxes are only paid twice a year. Your property tax payment could jump dramatically higher depending on amount of the loan you get. For some more perspective on these products here is a story published by the L.A. Times on the matter: https://www.latimes.com/business/la-fi-pace-loans-20170604-story.html Bottom line is to be aware of these programs and take time to review all the terms and conditions before you jump into something like this. The contractors selling their services and the financing along with them may be genuinely trying to provide a good service, but they will not know your overall financial situation and may not take the time to learn enough about it. Calculate exactly how much these payments will add to your annual budget and make sure you can comfortably afford it. And be sure to read all the paperwork and fine print before committing to one of these loans, so you don’t end up in over your head. The real estate market tends to have its own cycles throughout a year. While it may be more obvious in other parts of the country where the weather can have an impact on everyone’s ability to do things, generally speaking it’s harder to sell your house in the winter time than in the spring and summer.
Here in Anaheim and other parts of Southern California we are not really impacted by weather. We are lucky to be able to enjoy beautiful sunny days any time of the year. Even so, the real estate market is still subject to similar cycles. If you are interested in what is currently going on in the market, you can find updates on existing homes sales on the National Association of Realtors website and a variety of other places. The Holidays The holiday season around November-December when many people celebrate Thanksgiving, Christmas, Hanukkah or other holidays along with the New Year is one of the slowest times in real estate. Rightfully so, people are focused on spending time with family and friends, and likely spending money on gifts and celebrations and may tapping into some of their savings that would otherwise be allocated towards a down payment on a house. While there is always a market for real estate, this is not an ideal time to try and sell your house if you can help it. You may get a lower price due to less buyers being out looking than at other times of the year. Fall/Winter While a good chunk of this falls into the holidays, generally speaking the whole seasons of fall and winter are a bit slower. In addition to the holiday and weather effects, some of this also has to do with the traditional school year. Families who are contemplating a new house purchase or moving to another area often do not want to do it in the middle of a school year that would make things more difficult for their children. And they want to be able to be in a new house and get their children registered in new schools, etc. before a school year starts. While this is not always possible to achieve, this is what many families strive to do. Spring/Summer As you may have guessed, the Spring/Summer seasons are the best time of year to sell your house. They could also be called the “Real Estate Seasons” as it can make a significant difference in the speed that you can sell your home and the price that you will get just based on the overall supply and demand factors of this time of year. The weather is warm, people are in a better mood, and starting in the spring when many people get a financial boost from receiving money back after filing their income taxes, they are ready to start house shopping! So if you are completely flexibleon timing, you should always try and sell your house during the Spring or Summer months. When You Need to Sell Unfortunately for many people, you cannot always choose the perfect time to sell, and you simply need to sell a house for a variety of other reasons that may be completely unexpected. If you need to sell your house fast in Anaheim, whether it’s the height of summer or the dead of winter, Bright Idea House Buyers can help. We buy houses at all times of year (even the holidays) and in any condition - give us a call today! Rob had accumulated a few rental properties over the course of several years. With the combination of rental income, property appreciation, loan amortization and some additional tax write offs, the benefits of investing in real estate were appealing and proved to be everything he had hoped for. Unfortunately, market timing was not something Rob had studied, and he got caught in the big real estate downturn in 2008, along with the vast majority of the real estate owning population. Southern California was hit particularly hard, and Rob’s house in San Bernardino county was in one of the hardest hit counties in this area. Having purchased his properties in the few years prior, he found himself underwater on his mortgages and uncertain what to do. Through diligent management and a lot of hard work, Rob managed to hold on through the downturn and keep his homes rented until the values went back up over the next several years and lifted his properties back into a solid equity status. Unfortunately it was all Rob could do to keep up with the mortgage payments, and he put some repair items on the back burner to do at a later date. One particular property accumulated a lot of deferred maintenance - including a new roof and some major plumbing work. Not wanting to put himself back into a financially difficult situation, he decided it would be best to sell his property. But selling a property in that kind of condition is not easy, and since his tenants had a lease in place for another year it made it even harder. In situations like this a traditional sale to another end user buyer may not be the best choice for a homeowner. Investor buyers, that will buy properties in any condition, with no repairs and even occupied by tenants provide a viable option for situations just like this one. After researching his options, Rob decided to go this route and sold his house for a fair price without having to do any repairs or disrupting his tenants’ lease. With his problem house out of the way, Rob was able to focus on getting the rest of his rental portfolio in in shape and continue his path towards long term financial rewards from his real estate. If you have problem property that needs repairs, or maybe you are having problems keeping up on your mortgage payment, or if you just need to sell your house fast in Los Angeles, San Bernardino, or somewhere else in Southern California you may have more options than you think. If you have ever traded your car in to a car dealer or understand that process, working with a cash buyer investor is very similar. Selling real estate can be a complex process with loads of paperwork and legal requirements to fulfill. Cash home buyers can take the complexity out of the process and make it quick and easy, handling all the paperwork and details for you. Bright Idea House Buyers is one such local family owned company that helps people unload their problem properties quickly, easily and in any condition. If the idea of a simple, hassle free real estate transaction appeals to you - give us a call today at 424-625-7026 for a free no pressure consultation! If you’re wondering about the ins and outs of selling your home during a divorce in Los Angeles CA… we’ll dive into the steps and things to look out for in this article.
With over 50% of American marriages ending in divorce, many Los Angeles CA residents are looking or advice for selling a home during a divorce. A home is one of the most valuable joint assets, and obviously cannot be divided without first liquidating. While a divorce is one of the most stressful and emotionally charged life events, it’s important to remain rational. There are several factors to consider when facing a divorce in a real estate market that has yet to rebound from the housing bubble burst. Determine if (and when) You Will Be Selling Your Home During Your Divorce in Los AngelesIn many divorce cases, one spouse will keep the home, buying out the departing spouse’s share. In many cases, agreements are made where one spouse uses the house for a set period of time (this is usually used when there are children in the home), and then sold at a certain date (usually when the children reach a certain age). Get Professional Help – Agents and Home Buyers / InvestorsSelling a home is a difficult process when everything is going right. During a divorce, you have a lot going on, and a lot to consider. You shouldn’t take on the task of selling you home yourself. You may have disagreements with your spouse about selling price or other issues. By working with a real estate professional… either a reputable agent or real estate investment firm, you’ll both have a neutral third party who can help you determine a fair selling price and handle the marketing of your home. If you need to sell your Los Angeles house fast… reputable local real estate investment firms like Bright Idea House Buyers may be a great option. Firms like ours actually BUY HOUSES (rather than listing them like agents do)… and we pay cash and can close quickly if you need to sell this house fast. If you can wait the time it’ll take to list it with an agent and sell it on the open market, going with a real estate agent is your best bet. But if you can’t wait the 3-9 months it sometimes takes to sell a house in this market in Los Angeles… chat with us to see what we can offer you for your house during your divorce. Set (and stick to) a TimelineIt’s important, when selling your Los Angeles house during a divorce to keep a timeline. You should put your home for sale in advance. Set firm closing dates, moving dates and times, and coordinate which spouse will be handling the sale (or talking to the real estate agent). Make sure that each of these agreements are in writing, and negotiate penalties for breaching the agreements. This helps ensure a smooth, surprise free home sale. Selling Your House Fast For A Fair All-Cash PriceOne option that many divorcing couples have turned to in recent years is making a quick sale to a real estate investor like Bright Idea House Buyers. Reputable local real estate investors like us, purchase houses quickly and without stress, and the process can often take as little as seven days. Deciding how to sell a marital home in Los Angeles doesn’t have to be as stressful as the divorce itself. By protecting each party with a qualified real estate agent or simply jointly deciding to sell and selling fast to a real estate investment firm like Bright Idea House Buyers, and moving the process as quickly and according to an agreed upon schedule, all parties can walk away from the sale without stress. If you want to discuss your situation with your divorce and see if we can help you save time, reduce stress, and get out of this situation fast… |
Bright Idea House BuyersWe specialize in solving real estate problems - we are a local family owned business that purchases houses throughout the southern California area. Archives
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