For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

Therefore it is to your advantage to offer your Optionee incentives to be early.  Perhaps instead of the usual $100 per month credit toward the payoff of the Option Price, give them an extra $50 if they pay before the 1^st of the month.  What does that cost you when it’s all said and done – $600 a year?  That’s nothing compared to the payday you will receive when they exercise the option if you done your numbers correctly, and it ensures that you won’t lose out because they were thirty days late once in the past twelve months!

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

What Banks are doing now is really pushing the term “Relationship Banking.” They tell you that they are looking for long term relationships with clients instead of just a loan relationship or one account relationship.

What this really means is “give us your money, and we’ll string you along for as long as we can. By the time you realize that we’ve been giving you the run-a-round we’ll have used your money and made a ton off of you.” This dirty tactic is pretty common these days…so watch out who you bank with!

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

This is extremely important and actually can be a difficulty considering the economic times we are in. If you’ve just started this may also present a problem for you because you can’t convince a lender that you are a good loan candidate.

However, there is hope if you have a new business. You can create a business history by applying a few simple tricks of the trade. For example, you can have all money that comes in from all of your sources deposited into one central business, no matter how many accounts you have. Then you can use the deposits to show gross revenue into your business, which will satisfy the banks.

This does get tricky and must be done properly to maximize your borrowing potential, but at Investor Mortgage Pro we know how to guide our investors through this process.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

Lenders also prefer commercial loans because they are able to charge higher interest rates, decrease the amortization length, place subsequent reviews of the loan, and even force you to take an ARM product. This all works to the banks advantage.  The trick is being able to know to work the banks to come around to your favor.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

In the last post, we suggested that you have your lease option tenant meet with a financial expert to make sure that the tenant can exercise the lease option in the future. Here is an example of why this is so critical.

Let’s say that you have a Lease Option Tenant named Sue and Joe.  They had some problems a few years ago when Joe had a heart attack. He needed emergency surgery and he was out of work for two years.  Sue had to go to part time work to care for Joe and they ended up losing their home to foreclosure. They defaulted on all of their credit cards, and then had to file bankruptcy.  (Tear jerker isn’t it?)

But now it’s been two years since the bankruptcy. Joe had multi-bypass surgery and is back working a better job than he had before. Susan is working full time and they have re-established credit since the bankruptcy was discharged one year ago.

They have five thousand dollars to put down and their current credit rating is a 620. The Lease Payment of $1400.00 a month is five hundred dollars less than what they were paying for their mortgage, and is $400 more per month than most rentals are going for in the area, which means better cash flow for you  Sounds like they would be the perfect couple to lease option in the next 24 months, don’t they?

But what you don’t know is if you really do want them to exercise the option in twenty four months they have no chance at all at getting financed.  Why?  Because it will only have been three years from the discharge of the bankruptcy, and you they not only had a bankruptcy but they also had the foreclosure. These are considered to be two “lifetime events” in the lending world, which means that they cannot get financed for at least seven years.

So even though Sue and Joe may be great possibilities, they are not the ones to place in the property unless you are going to be willing to wait until it is seven years after their bankruptcy. This means you will need to readjust the terms of the Lease Option if they are going to be in the home.

You might even have to move them to another property that you are willing to have a long term tenant so that way you don’t lose the opportunity. There is a slim chance you could get them done FHA, but not enough of chance that it would be worth the risk.

As you can see, it’s vitally important that you have your lease option tenants go through this process so you can be sure that the lease option can be exercised in the future.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

This is going to cost you an average of $200 to $300 for the service. It is critical that you do it! What we have most of our investors do is make this fee part of the Non Refundable Lease Option Fee, and pass it on to the tenant.

DON’T SKIP THIS STEP! Don’t get cheap at this point in the process. View this on the same level as getting a property inspection before you purchase a home. Sure you may get away with not having one, but the vast majority of times, it ends up costing you more money in the long run than if you had just spent the money for the inspection in the first place.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

Who wants to hear that your credit matters? NO ONE!  So the Gurus came up with the slogan “Credit doesn’t matter” in order to sell their products. And guess what? It worked!

Real Estate Gurus have sold billions of dollars of products by getting people to buy into that line of reasoning because they can produce a small number of cases where someone didn’t need an credit score in order to get a deal done.

Well guess what? It’s a new ballgame. The 70s, 80s, 90s and roaring years of the early 2000s are gone. We are now in the recession of 2008-2011 and credit is important.

That being said, what if your credit stinks? Does this take you out of the running? Not necessarily.  With the right education and guidance you can overcome this problem. We’ve taken people from the depths of the credit cellar to the top of the rung in a short period of time.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

Your net worth can have a big impact on your ability to get a loan. Over seventy (70%) of all declined loans for real estate investors today are a result of the applicant having a negative net worth.

Knowledge is the key to success or failure with getting a loan. You need to know whether or not you have a positive net worth, and you need to know what steps to take to insure that you have a positive net worth. There are some things that you can include in your calculations that the banks will allow, however it’s vital that you know exactly what they are.

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.

Now there are a bunch of inexperienced appraisers, or even worse not even fully licensed appraisers, left in the pool of appraisers. Not only are these appraisers low  on experience but most have been coached by the banks to bring in the appraisal at a far lower value than normal. This is done in order to protect the banks…which doesn’t help you!

It’s like going to the hospital and finding out that the only people there are first year residents! Technically, a resident is a doctor, but are they the one you want working on you at two in the morning when you have severe chest paints?  I don’t think so.  The banks, of course, deny they are coaching the appraisers to bring the values in low – but the proof is in the pudding! HVCC has definitely changed things…for the worse!

For properties that turn Average Joes into Real Estate Investing Pros, be sure to visit http://www.wholesalepropertypro.com.