If you are interested in purchasing Real Estate Owned (REO) or short sale properties, then you need to understand the basics of transactional funding and proof of funds letters and how they relate to your real estate interests and activities. Essentially, the transactional funding refers to the funds borrowed for a very short period to transfer a property from the current owner, to the transaction coordinator, then to the new owner. Proof of funds letters are used to help secure financing and smooth the way for the real estate transactions you are involved in.
Transactional Funding
The use of transactional funding allows the short sale process to take place smoothly. The basic premise for the loan is that once the original owner is ready to sell and the buyer is ready to take over the property (usually with a standard mortgage), there is a short term loan needed to faciliatate the transfer period. This means that the transactional funding is a loan that exists for just a few hours, before being recovered when the final property owner pays for the property.
The two separate transactions that place on the day of settlement create a unique situation known as a double closing. Lenders like these loans as the lending period is typically just several hours. If the transactional funding lender ensures that all the other financing for the transfer of the property is in place, this makes this short term loan delivers a relatively low risk opportunity for a profitable outcome from the provision of the short term loan.
Transactional funding works not only for the short sale scenario described above. A savvy investor can structure the use of a short term loan to easily carry out purchases of real estate owned (REO) properties, or any other real estate transaction that is based around a double closing.
Proof of Funds Letters
When purchasing property, the buyer must provide some form of evidence that they have the funds to cover the property acquisition - this is where a proof of funds letter becomes useful. This document that the investor can use to indicate to the parties involved in a real estate transaction that you have pre-qualified to purchase the real estate.
The proof of funds letters are used to demonstrate that investors have the financial resources or means to fund a property transaction. They indicate to the other parties that your funds are legitimate and can be used for the purchase of the property. This type of document is particularly useful if you are involved in short sale transactions and REO purchases that are structured with a double closing or when using transactional funding. They can also be used for other transactions that require documented evidence of your financial resources.
The proof of funds letter is generally provided as a bank, security or custody statement, stating that the investor or property buyer has funds for the real estate purchase that are obtainable and legitimate. Using this letter, the buyer/investor is able to secure any necessary additional funding or to assure the seller that they have the means to fund the real estate purchase.
To achieve success in real estate investment, it pays to fully understand the different options available to you and how to use them to maximum advantage. Transactional funding and the use of proof of funds letters are two added 'tools' in your investment toolkit. Once you understand how these financial opportunities can be used to the best advantage, you'll be on track to achieving financial security through real estate investment.
Tuesday, May 26, 2009
Saturday, May 23, 2009
How To Build a Buyers List
Here are some tips and resources that I use to build my buyers list.
Social networking sites:
Create profiles on these sites and network with other investors, join investor groups and include links to your web page.
Facebook
Twitter
myspace
Classified ad sites:
Post ads on these sites for investor specials, handyman specials, etc. You don't need to have a property currently under contract to do this. Include links to your webpage to join your buyers list.
Craigslist
Backpage
Kijiji
Blog Sites:
Create a free blog using one of these free services and write about what's going on in your market and the great deals available. Include links to join your buyers list.
Wordpress
Blogger
.
Local REI Club:
Go to the rei club meetings and network with other investors and collect and give out your business cards. You can then add these investors to your buyers list
Essential tool: Opt-in Form & Autoresponder
If you have a website or you're using a free blog service you need to have an opt-in form and autoresponder in place to be able to collect your buyers contact information and email them once you have a property under contract. The most simple service to use is aweber. You can use aweber to create a form and simply copy and paste that code in your website or blog to collect you buyer's information. You don't need any technical skills to do this as it's extremely simple. Aweber will provide you with video tutorials that will walk you through step by step. You can also use aweber to stay in contact with your buyers so that they will know immediatly that you have a property under contract to sell to them.
Social networking sites:
Create profiles on these sites and network with other investors, join investor groups and include links to your web page.
myspace
Classified ad sites:
Post ads on these sites for investor specials, handyman specials, etc. You don't need to have a property currently under contract to do this. Include links to your webpage to join your buyers list.
Craigslist
Backpage
Kijiji
Blog Sites:
Create a free blog using one of these free services and write about what's going on in your market and the great deals available. Include links to join your buyers list.
Wordpress
Blogger
.
Local REI Club:
Go to the rei club meetings and network with other investors and collect and give out your business cards. You can then add these investors to your buyers list
Essential tool: Opt-in Form & Autoresponder
If you have a website or you're using a free blog service you need to have an opt-in form and autoresponder in place to be able to collect your buyers contact information and email them once you have a property under contract. The most simple service to use is aweber. You can use aweber to create a form and simply copy and paste that code in your website or blog to collect you buyer's information. You don't need any technical skills to do this as it's extremely simple. Aweber will provide you with video tutorials that will walk you through step by step. You can also use aweber to stay in contact with your buyers so that they will know immediatly that you have a property under contract to sell to them.
Monday, May 4, 2009
Transactional Funding JV Oppurtunity For Reo and Short Sales
Do you have a real estate deal lined up but you are unable to access the cash to get the deal closed? Maybe you don't want to pay the high fees associated with getting a hard money loan to flip your reo and short sale transactions. What if you can get transactional funds and proof of funds letter. How many deals do you think you can do then? Would an extra two deals a month help? Maybe you need to do five or more deals? Who knows, but times are tough and if you got burned with foreclosures in the real estate meltdown there is a way to benefit in these tough times. I want to extend to you an opportunity to make money in these tough times.
Let me help you to help yourself. I am a real estate investor that's been enjoying the benefits of using private money to flip properties and want you to enjoy the same benefits. Jv with me to close your deal or deals using private money for 30 percent of the profits. If you want to take advantage of this opportunity contact me and I will send you a JV agreement so we can get started.
To your success in 2009.
Let me help you to help yourself. I am a real estate investor that's been enjoying the benefits of using private money to flip properties and want you to enjoy the same benefits. Jv with me to close your deal or deals using private money for 30 percent of the profits. If you want to take advantage of this opportunity contact me and I will send you a JV agreement so we can get started.
To your success in 2009.
Monday, January 19, 2009
How to Locate Private Money to Flip Short Sales
In different areas of the country, real estate investors are having difficulty getting financing for their deals. Some hard money lenders have gone out of business and the funds that were easily available are no longer around. As a matter of fact the hard money lenders who actually still have cash available now require a down payment to use their private money. You have to put up more of your money plus credit and still have to pay up to fourteen percent plus other holding costs to flip properties. This process has stopped a lot of investors from doing deals.
There’s a great strategy out there that some investors have adopted because of the shortage of private money. They have found companies on the web that allow them to use private money to do double closings. The strategy I’m referring to is using private money to flip short sales and bank reo properties. Even though the market is suffering there are still “A” credit buyers out there that are looking for deals. They are intelligent to know that it’s a buyers market and so they are picking up properties with equity that’s twenty percent or more below market value.
By using private money you can pick up these properties cheaper than the average buyer because you’re using cash. So even though your end buyer with conventional financing may be able to pick up an property that’s twenty percent below the market you can come in and get it for about 40, 50 and in some areas 60 percent below market value as a cash buyer. You can then flip that property to your end buyer in a double closing transaction allowing you to make 10 to 50% profit spreads with Short Sales and REO’s. The double close is structured as an “A” to “B” then “C” to “D” transaction. The bank is the “A” seller; you the investor are the “B” buyer. This covers your transaction buying the property from the bank. The “C” to “D” process now makes you the investor “C” seller and your end buyer purchasing the property from you becomes “D”. This deal is structured so that if your end buyers financing doesn’t come through you are not stuck with the property. This protects you and the private money lender.
When you search the internet look for companies that provide private money with no up front costs. Most of these companies are charging up to four percent before they fund you the private money for deals. This can become very costly and eat into your profits. Things to look for are companies that allow you to use their private money and charge you about one percent plus a usual $300 admin fee with closing costs that is taken out of your profits at closing. This will allow you to work multiple deals at once.
Once you’ve found your private money funding source you can now start making deals to flip short sales. Here is an example of how a short sale flip with private money using the double closing strategy will work:
$100,000 Retail Value of Property
$50,000 Bank Accepts Your Short Sale Offer
$80,000 You Resale to End Buyer at this Price
$30,000 Your Profit at Closing
$1500 Your Cost of Funds (2% Plus $500)
There’s a great strategy out there that some investors have adopted because of the shortage of private money. They have found companies on the web that allow them to use private money to do double closings. The strategy I’m referring to is using private money to flip short sales and bank reo properties. Even though the market is suffering there are still “A” credit buyers out there that are looking for deals. They are intelligent to know that it’s a buyers market and so they are picking up properties with equity that’s twenty percent or more below market value.
By using private money you can pick up these properties cheaper than the average buyer because you’re using cash. So even though your end buyer with conventional financing may be able to pick up an property that’s twenty percent below the market you can come in and get it for about 40, 50 and in some areas 60 percent below market value as a cash buyer. You can then flip that property to your end buyer in a double closing transaction allowing you to make 10 to 50% profit spreads with Short Sales and REO’s. The double close is structured as an “A” to “B” then “C” to “D” transaction. The bank is the “A” seller; you the investor are the “B” buyer. This covers your transaction buying the property from the bank. The “C” to “D” process now makes you the investor “C” seller and your end buyer purchasing the property from you becomes “D”. This deal is structured so that if your end buyers financing doesn’t come through you are not stuck with the property. This protects you and the private money lender.
When you search the internet look for companies that provide private money with no up front costs. Most of these companies are charging up to four percent before they fund you the private money for deals. This can become very costly and eat into your profits. Things to look for are companies that allow you to use their private money and charge you about one percent plus a usual $300 admin fee with closing costs that is taken out of your profits at closing. This will allow you to work multiple deals at once.
Once you’ve found your private money funding source you can now start making deals to flip short sales. Here is an example of how a short sale flip with private money using the double closing strategy will work:
$100,000 Retail Value of Property
$50,000 Bank Accepts Your Short Sale Offer
$80,000 You Resale to End Buyer at this Price
$30,000 Your Profit at Closing
$1500 Your Cost of Funds (2% Plus $500)
Friday, January 16, 2009
Insider Source For Private Money to Flip Short Sales
The Real Estate market has changed dramatically. Real Estate Investors that are making money have found a source of Private funds to flip their deals. If you're having problems getting hard money loans or you have to put a down payment to get a hard money loan then I have the answer for your problem. With our HSA program as a platinum member you have unlimited access to our private money to flip short sales and bank owned properties. This is the only source of private money that you don't have to pay any upfront fees or high points to use the private money. Once you become a platinum member and use our private money you will be charged 1% plus a $300 admin fee from your profits. Closing costs are generally about $2k using our recommended title company that's familiar with doing double closing. Here's and example of how you will use the private money to flip a short sale property to an end buyer.
$100,000 Retail Value
$50,000 Bank Accepts Your Short Sale Offer
$80,000 You Resale to End Buyer
$30,000 Your Profit at Closing
$1500 Your Cost of Funds (2% Plus $500)
Register for free by clicking here.
$100,000 Retail Value
$50,000 Bank Accepts Your Short Sale Offer
$80,000 You Resale to End Buyer
$30,000 Your Profit at Closing
$1500 Your Cost of Funds (2% Plus $500)
Register for free by clicking here.
Wednesday, December 17, 2008
Buy Real Estate Short Sale with Private Money
Do you realize that with this money available to you; you will have a proof of funds to structure the deal allowing the bank to accept the offer? If you already have an approved buyer for one of their mortgages, you will make nothing but profit with very few headaches!!!!
- NO CREDIT CHECKS
- NONE OF YOUR OWN MONEY
- BUY FORECLOSURE PROPERTIES
- CLOSE REAL ESTATE SHORT SALE
AS GOOD AS THIS IT GETS BETTER BRING YOUR END BUYER IN FOR PRIVATE MONEY MORTGAGES.
("A","B",& "C" PAPER & CREDIT)
Sell Properties FAST!!!
LIVE WEBCAST TUESDAY AND WEDNESDAY NIGHTS AT 8PM EST ONLY @
PRIVATEFUNDSFORDEALS.COM
- NO CREDIT CHECKS
- NONE OF YOUR OWN MONEY
- BUY FORECLOSURE PROPERTIES
- CLOSE REAL ESTATE SHORT SALE
AS GOOD AS THIS IT GETS BETTER BRING YOUR END BUYER IN FOR PRIVATE MONEY MORTGAGES.
("A","B",& "C" PAPER & CREDIT)
Sell Properties FAST!!!
LIVE WEBCAST TUESDAY AND WEDNESDAY NIGHTS AT 8PM EST ONLY @
PRIVATEFUNDSFORDEALS.COM
Thursday, December 11, 2008
How to Get Private Money To Purchase Short Sales and Foreclosures
There's a great program that I found that allows you to purchase short sale and foreclosures without using any of your credit and cash. This gives you great leverage to be able to get a short sale or foreclosure properties for deep discounts and creating equity out of thin air. I have spoken to a few fellow investors that have been using this strategy and have been collecting huge checks.
This program will provide free training on how to find and contract with a pre-qualified buyer as well as providing you the Proof of Funds and the Cash to buy the short sale from the Bank.
Cost of Funds is 1% plus $300 flat fee all paid from your profits at closing. Buy a home worth $200,000 in a short sale for $100,000 and resale for $150,000. You keep $50,000 minus 1% (1,000+$300 flat fee). You pay for the use of the money from your profits at closing, meaning no cash out of your pocket to use the funds. Fill out my form below the about me section and I'll get you the information on this program.
This program will provide free training on how to find and contract with a pre-qualified buyer as well as providing you the Proof of Funds and the Cash to buy the short sale from the Bank.
Cost of Funds is 1% plus $300 flat fee all paid from your profits at closing. Buy a home worth $200,000 in a short sale for $100,000 and resale for $150,000. You keep $50,000 minus 1% (1,000+$300 flat fee). You pay for the use of the money from your profits at closing, meaning no cash out of your pocket to use the funds. Fill out my form below the about me section and I'll get you the information on this program.
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