Anyone that tells you, you don't need money to do buy, fix, and flip is lying. Now I didn't say it had to be your money, OK? But you do need money to do a deal. So, unless you are sitting on a ton of cash, you are probably going to be look at borrowing the money for your buy, fix, and flip, deal from a hard money lender, not the bank. 

Traditional Lenders

Let me describe how it really works, because I have been a real estate lender for over 30 years. I started lending with the Bank of America when I was only 22 years old. I have worked for the Bank of America and the Chemical Bank of New York, and have been a residential and commercial lender and commercial mortgage broker for the last 20+ years.

Let’s say you were going to go to a bank to try to get this deal done and buy residential property as an investment. First off, the banks are not going to be wild about making that loan in the first place, and you must go through all their hoops and rules and you must have a 20% down paymen...

There is the golden rule of business. This is not the golden rule you learned in Sunday school. The golden rule of today’s business is that he or she who has the gold makes the rules. They make the rules and then they enforce them. Banks require that when you to agree to their deal you must live or die on their restrictive and limiting rules.

I also want to address purchasing a foreclosure at a tax auction or sheriff sale. You’ll have to comply with their rules. When you’re buying a property in that venue, where you have an auction, you’re buying the property without ever seeing the inside of it. It’s boarded up, it’s papered up, you can’t get in, you’re not going to see it. You can’t bring your appraiser in. You can’t bring your inspector in. You can’t get in to do it. This is what I call Real Estate Gambling. If you buy it, pig in a poke, you have no idea what you’re getting into. Plus, you have to pay for the purchase with all cash, on the spot, no contingencies, and no title insur...

The residential REO market has changed. There’s less inventory than there was in 2008 to 2012. There are several points I want to make here about what’s going on with the current REO (Bank Real Estate Owned) market when it comes to investors who are purchasing REOs for buy, fix and flip and buy, fix, hold.

Between 2007 to 2011, banks were giving away their foreclosure resales at approximately half price because the REOs were destroying the banks’ balance sheets. They were terrified that the United States government (Controller of Currency) would come in and shut them down. If you remember, we were watching on the news and on the internet in 2008, 9, 10, 11 and 12, when, four, five, six hundred banks were seized and closed a year. And that was because their portfolio of residential bad loans. The banks’ sub-prime loans, \were taken care of by the federal government’s $7 hundred billion bailout.

A lot of real estate agents, brokers, and “gurus” concluded that, because there were great ...

Stuck Investing in Residential Real Estate?

Discover the 3 traps that keep residential real estate investors feeling frustrated, fearful, and caught in a feeding frenzy!...and how to escape them.

Are you a real estate investor who is trying to make money with REOs and Buy-Fix-Flips?

If so, are you frustrated with fierce competition from other investors, the small margins you’re making on deals, and how the banks are limiting your success?

I want to address the 3 traps that keep residential real estate investors, just like you, feeling fearful, frustrated, and caught in a feeding frenzy. And you don’t need to be, because there is a better alternative.

What are the 3 traps? I call them the REO Rat Race, the Buy-Fix-Flip Fiasco, and the Cash-Credit Crunch.

Check back soon; I'll talk in depth about each of these traps, 1 each week.

Want to find out how easy it is to find cash-flowing commercial real estate in 3 easy steps? Take my free mini course now. Absolutely no obligation. 

Dr...

I was so honored to be interviewed by Tom Antion (Internet Marketer and Multi-millionaire)

You can watch it here: Screw the Commute PODCAST

Want to find out how easy it is to find cash-flowing commercial real estate in 3 easy steps? Take my free mini course now. Absolutely no obligation. 

Dream Bigger! Succeed Faster!

Take Care,
~Doc Haller

Economics is not an exact science whether applied to commercial real estate or any other part of a changing economy. Inflation is just one illustration. How much inflation will we have during the next five to ten years and when will it happen? Who can be sure how inflationary the economy will be in precise terms? Much like the weather, economies have a way of suddenly taking unexpected twists and turns.

Economic analysis of a commercial property may seem daunting to a new investor, but you can learn to mitigate your risks when you discover where to go for the needed information. Read Local Business Journals, and talk to folks at the Chamber of Commerce. Join real estate groups and talk with other investors. Check out not only historic and current vacancy rates but also other factors such as space available for development.

The more you know, the more prepared you’ll be to begin your own economic analysis of potential investments, and what to do in case of economic changes.

Want to f...

Want to Become a Billionaire?

Check out the Forbes Newcomer Billionaire List for 2015. Number 1 is MEDIA and ENTERTAINMENT. After that, the clear unequivocal 2nd is REAL ESTATE. And it is not residential; it is commercial. Period. Not just in the United States, but around the whole world. Many billionaires from the United States to China, from England to Canada come from commercial real estate. These are the facts, anybody that tells you they create wealth from one-off deals is probably stretching the truth. And when you're doing 2, 3, 4, and 5 buy, fix, and flip deals and trading your time for another job, you’re probably working a lot harder than you need to be. Aren’t you trying to get out of your J-O-B to have real time and financial freedom?

If you want massive passive income to acquire resources that will make you wealthy over the long-term; commercial real estate is, always was, and always will be the primary source to make people wealthy. As a matter of fact, it has been for ...