Ten Myths Of Real Estate Investing

Is real estate investing only for the wealthy? Can you buy with no money down? Do you have to know the "right" people? Let's answer by looking at some of the myths of real estate.

1. Real estate investing is for the wealthy. Money helps, but my first real estate investment was a $3,500 lot - which I sold for a profit two weeks after I bought it. Small deals, partners, low-down deals, or just putting aside $7 per day for a couple years until you have enough money for a downpayment - these are some of the ways to start with a little and invest in real estate.

2. "0 down" isn't possible. I sold a rental property for $1,000 down because I trusted the buyer to make the payments, and I wanted the 9% interest and higher price. He could have gotten a cash-advance on a credit card for another $30 per month and made it a "0-down" deal. "No money down" means none of YOUR money down, and yes, it happens.

3. "0 down" is the best way. If you don't invest some of your own money, you'll have higher payments. You'll also spend more time finding suitable properties, and pay more for them (generally cooperative sellers want more for their cooperation - I do). There are 0-down deals out there - they just aren't always worth doing.

3. You need experience. Experience helps, but you get it by investing. Start with common sense, ask how you can lose money, be willing to learn the numbers, and you can start where you are.

4. Some investors have a "knack" for making money. Sort of. More accurately, some just took the time and risk to learn the market and continue their education.

5. You need to know the "right" people. It helps, so start the process. Talk to investors, real estate agents, landlords, etc.

6. You have to be great negotiator. If you learn to run the numbers and make the offers based on them, you can be the worst negotiator and still do okay.

8. You need insider knowledge. Understand one deal, and you are on your way. Read and read more, but the best "insider" knowledge comes from experience.

9. Fixer-uppers are safe. People have the idea that doing the work themselves is the safest way to assure a profit. Not true. Mis-planned "fix and flips" have bankrupted even experienced investors. Most poorly purchased rental properties will only eat a little money every month.

10. The key is lowball offers. The numbers have to work, and you need a plan. You can offer MORE than the market price and make money investing in real estate, if you understand creative financing - and how to do the math.

Steve Gillman has invested real estate for years. To learn more, and to see a photo of a beautiful house he and his wife bought for $17,500, visit http://www.HousesUnderFiftyThousand.com

More than 40 states signed onto a proposed $25-billion deal with major mortgage servicers over faulty foreclosure practices. New York, Nevada and Delaware joined California in holding out for better terms.

More than 40 states signed onto a proposed $25-billion settlement with major mortgage servicers over faulty foreclosure procedures, but California, New York and other key states were still not among them.

California has until Monday to share in a multi-state deal with banks to obtain mortgage relief and reforms. Atty. Gen. Kamala Harris, who walked away from talks last year, says the door remains open.

With a Monday deadline at hand, California officials have resumed direct talks with the Obama administration about joining a multibillion-dollar, multi-state mortgage settlement with the nation's largest banks, a source said Sunday.

The talk show host pays $12 million for the 4,088-square-foot house with four bedrooms and four bathrooms. The ocean-view home sits on 1.26 bluff-top acres with beach access.

In one of the more talked-about transactions in town, actors Brad Pitt and Angelina Jolie have sold their Malibu beach house to daytime host and comedian Ellen De Generes for $12 million.

The four-bedroom, five-bathroom house built in 1920 for industrialist James Wigmore lists for $2,875,000.

A decorative cast stone entrance opens to this restored Spanish Colonial Revival-style house in Pasadena's South Orange Grove area. Built in 1920 for industrialist James Wigmore, the house retains such original details as coffered wood ceilings and arched doorways.

They don't believe they can sell their property for what it's worth, so they're spending money on making their homes more comfortable.

Do you fit any of these descriptions?

A biennial research report by the National Assn. of Realtors indicates that a handful of real estate agents and brokers and their clients either don't know the law or don't care to follow it.

When it comes to lawsuits, real estate agents and brokers tangle mostly among themselves.

The president aims to help about 3.5 million people with good credit who are unable to refinance at historically low rates because their homes are worth less than their mortgages.

 

The White House hopes to help millions of homeowners lower their monthly mortgage bill with a $5 billion to $10 billion plan to set up a streamlined refinancing program for people who are current on their payments.

The Standard & Poor's/Case-Shiller index of 20 large U.S. cities fell 1.3% in November from October as foreclosures continue to drag down the housing market.

Three straight months of home-price declines in the biggest U.S. cities showed that foreclosures remain a significant drag on a housing market that is entering its fifth year of deterioration.

L.A. Clipper Chris Paul may be quick down the court, but he moves pretty fast when it comes to buying multimillion-dollar real estate too.