Should You Sell and Rent Back Property? Secure a Quick House Sale to a Property Cash Buyer

A sell and rent back scheme involves that person selling a home to a property cash buyer for about 75% of it’s market value. Whilst selling a house in a falling market can take many months, this isn’t the case with a sell and rent back.

Sell and Rent Back can Stop Repossession

It is possible to get a quick house sale and stop repossession, provided that at least 25% home equity is available. It is even possible to stop repossession when there are just hours left to go. The availability of a property cash buyer means that the court is willing to intervene. The entire process will be handled privately and the neighbours won’t be aware of what has transpired.

A Quick House Sale at Below Market Value

Whilst a sell and rent back ensures a quick house sale, most property cash buyers will only offer up to 80% of market value. Those selling a house may be able to get a better price on the open market or even at auction. However, those selling a house won’t have to pay estate agent and legal fees. It is also argued that many estate agents bump-up valuations to entice homeowners into selling.

Sell and Rent Back Schemes and Money Problems

Homeowners regularly choose a sell and rent back scheme because a cash lump sum helps them to clear personal loans, overdrafts and credit card bills. The removal of money problems and the provision of a lower monthly rent can make life more affordable for families.

Regulations and Assured Shorthold Tenancy Agreements

There is currently minimal regulation with respect to sell and rent back schemes. This means that different companies have varying terms. Whilst some property cash buyers are looking to establish long term relationships with tenants, others choose to invoke assured shorthold tenancy agreements. This could mean that a tenant is removed from their home in as little as 6 to 12 months.

A sell and rent back scheme is an excellent way to stop repossession. Anyone facing repossession should seek a property cash buyer, provided sufficient home equity is available. However, homeowners that aren’t in immediate financial peril should seriously consider selling a home on the open market to get a better price.

Those struggling to prevent property repossession should check to see if they have an unlawful mortgage agreement. This could mean that a homeowner is entitled to compensation or even the write-off of the full debt in certain circumstances. This also applies to illegal loan agreements and unlawful credit card agreements.

Should Mortgages be Modified?

Record numbers of foreclosures are affecting millions of American citizens today. The problem has become such an epidemic that the government has begun paying banks to work out mortgages and avoid foreclosing. As a taxpayer, it is important to understand what the government is really paying for and if its really some to support.

Mortgage Modification Pros

Mortgage modification provides numerous benefits to homeowners. Foreclosures negatively affect property values, so homeowner in the neighborhood benefits when a house avoids the process. Besides benefitting from higher market prices for their homes, they also don’t suffer the negative externalities foreclosures often bring: crime, trash, disrepair, etc.

Promoting homeownership and support the nation’s people in their time of need should also be considered. For many households, all of their positive net worth is tied up in their home. It provides a vehicle that forces consumers to save and could even provide a nice nest egg for retirement. It can be argued that this should not be the case, but for many homeowners it is a reality.

Homeownership also has positive externalities, as well. People, who own their homes, tend to take better care of their property and get more involved in their neighborhood. This means better schools, less crime and a generally nicer neighborhood. In some areas, modifying mortgages is the only thing that keeps neighborhoods in tact.

Mortgage Modification Cons

Anyone that has chosen not to be a homeowner must now bear the burden of homeownership without getting any of the benefits. Many modifications allow homeowners to live in homes at a cost below renting. Furthermore, many people, homeowners include will argue that the government should not reward those people that mismanaged their finances.

There are far too many examples of school teachers living in $500k+ homes and earning $30k per year. Even if banks were willing to give that person a loan, the person should have known better. Too many times people pass the buck onto someone else when they make poor decisions.

If society continues to bail people out, how will people understand the consequences of taking risks? Homeownership is the same as investing in a very expensive asset. Like any other investment, it has the ability to go up in value and go down in value. The homeowner is the one to blame if they do not understand the risks. If they choose to sign their name on a dotted line and hand over thousands of dollars without doing their homework, why should the fiscally responsible suffer?

Society does itself a disservice by allowing its citizens to avoid paying the price for bad decisions. Using hardworking people’s money to reward bad decisions rewards all the wrong people. It directly rewards the banks that made bad loans and it indirectly rewards homeowners that did not do their homework before investing in a bad asset.

Mortgage Modification Summary

Promoting homeownership certainly has benefits. Ownership helps people connect more with their community and adds tremendous value to the neighborhood. However, when homeownership becomes more about trading up every two years to out run mounting debt, all parties should suffer the consequences of their actions. If a modification makes business sense to a bank, then they should be free to pursue that option. To take taxpayer money and bail out banks and homeowners that made bad decisions should not be considered lightly. In the end, what does that really teach society?

Reverse Mortgage: Advantages & Disadvantages

If you’re at least 62, you can probably qualify for a reverse mortgage. For those unfamiliar with the term, a reverse mortgage isn’t free money. It’s a loan. It has to be paid back, but not until you pass away or sell your home.

Some advantages:

  • No credit check most of the time
  • No restrictions on how you spend the money
  • No monthly payments
  • No tax liability
  • You can take the whole amount at one payout or in regular installments.
  • You can fix a cash-flow crunch, pay bills, or just afford extras that you can’t afford now.
  • It might allow you to stay in your home as you age, allowing you a budget for home care, medications, and so forth.
  • No one can force you to sell your home.
  • You can never owe more than what your home is worth when the loan is repaid.
  • Reverse mortgages can be refinanced.

The down sides:

  • High cost of borrowing – the upfront fees can be pretty steep.
  • If you become ill and have to move, the loan will have to be repaid at that time.
  • If your heirs are counting on your money for their retirement, they might have to find another way to finance themselves.
  • Selling your home may be a better choice for you.
  • If you opt for this program before you’re about age 70, you’ll get less money out.

Some financial experts like Terry Savage of the Chicago Sun-Times maintain there are no down sides to reverse mortgages. She helped her own father (age 84) get one.

Others take a more conservative perspective, like Julie Tripp, who writes for the Oregonian.

As in all matters of finance, consult the people you trust. Your banker. Your attorney. Your accountant. Make your decision on fact; never base it on panic or fear.

Sell Property Fast With Simple Home Renovations: What is the Best Home Improvement for Selling a House?

Buying property is notoriously stressful. The investment is huge, and it is always possible to make a bad mistake. But selling a house can be nerve-racking, too. To sell property fast and for the maximum amount demands care and attention. But some expensive home renovations only lose money and do nothing to help fast house selling.

Television home makeover programmes have persuaded many that they really cannot do too much to maximise the selling price of their home. But the real gainers from all this work are home improvement retailers such as B&Q and Homebase.

Simple House Selling Tips

Many simply cannot face undertaking expensive and time-consuming home renovations before selling a house. It’s a lot of trouble, and they just want to sell the property fast and move on. Nothing wrong with that.

But there are still a few basic house selling tips that apply across the board. For fast house selling, the home should at least be clean and tidy. Crucially, the removal of clutter makes rooms look bigger and enables viewers to imagine what they might do with them. Strongly personal items like family photographs should not be on view: potential buyers don’t need such distractions.

The house should be well aired, and strategically placed vases of flowers and bowls of fruit are easy on the nose as well as the eye. The smells of freshly brewed coffee and freshly baked bread are universally enjoyed, those of freshly cooked curry and freshly grilled fish are not.

Pets should be kept out of the way altogether – preferably housed with friends or relatives. Not everyone likes dogs, their odour or their shed hairs.

Simple Home Renovations Help Sell Property Fast

For those who are prepared to go a little further, carefully targeted home renovations can pay dividends. It is, for example, well worth touching up shabby paintwork, having carpets professionally cleaned, and fixing such obvious imperfections as dripping taps.

And those anxious to sell property fast and profitably do not have to guess at what works best, because last year, Halifax, Britain’s largest supplier of residential mortgages, published their own findings.

The general perception is that the best way to maximise profits when selling a house is to add rooms. But Halifax found that, while this does indeed increase value, it is not the best home improvement the seller can make. It is not even in their top five house selling tips.

Percentage return on investment, they found, was higher for (in ascending order) loft conversion, garden improvement, redecoration and home security measures.

By contrast, laminate flooring and new carpets were among those things which were found not even to recoup costs. In other words, simple redecoration works, because it makes a house look better. But for anything more elaborate, do not anticipate the tastes of others.

The Best Home Improvement When Selling a House

But for the seller who wants to do just one thing to ensure fast house selling at a good price, Halifax were unequivocal. Investment in fuel efficiency and energy saving measures will generally yield a return of some 250 per cent, making it the best home improvement a seller can make.

So for those who want to sell property fast and profitably, loft insulation and cavity wall insulation are amongst the things to consider. In these green times, expert advice is readily available.

The lessons from Halifax are simple. To sell property fast and profitably, there are five things to consider above all others:

  1. Fuel efficiency and energy saving
  2. Home security
  3. Redecoration
  4. Garden improvements
  5. Loft conversion

Sell and Rent Back – Pros and Cons: Find a Property Cash Buyer and Get a Quick House Sale

Selling a home is very difficult in an economic downturn due to falling property prices, job losses and lenders not lending. A sell and rent back has grown in popularity as it allows that person to sell their home to a property cash buyer, get a quick house sale and continue to live there as a tenant. A property cash buyer typically offers 75% of the properties true market value.

Benefits of Sell and Rent Back

  • Prevents property repossession. A sell and rent back to a property cash buyer can help to prevent property repossession. Provided that a minimum of 25% equity is available, a quick house sale can halt repossession proceedings.
  • Handled privately. There are no estate agent boards put up so the general public will not know that a sell and rent back is taking place. The entire process of selling property is dealt with privately.
  • No estate agent and legal fees. A quick house sale performed in conjunction with a property cash buyer means that a sell and rent back avoids estate agent fees of 1-2% of the sale value.
  • Sell a house quickly. Access to a property cash buyer means that the sale can be speedily completed. This allows the seller to reduce monthly bills or avoid property repossession.
  • Affordable rent. A sell and rent back means that the seller normally enjoys lower rental payments and more affordable household bills.

Negatives of Sell and Rent Back

  • Below market value. In order to attract a property cash buyer and secure a house quick sale, sell and rent back schemes usually involve selling a house for up to 80% of market valuation. Critics argue that it is possible to secure a higher price on the open market.
  • Assured shorthold tenancy agreements. Those considering a sell and rent back should be careful to avoid assured shorthold tenancy agreements that only last for 6 or 12 months. Once this period elapses, it is possible for the new landlord to remove the tenant. Only accept a quick house sale from a buyer seeking to build a long term business relationship.
  • Negative equity. A sell and rent back scheme will not be accepted by a property cash buyer should insufficient or negative equity exist. This is because all offers are below market value.
  • Market regulation. There is very little sell and rent back regulation, leaving considerable scope for unscrupulous property cash buyers to operate.
  • Complex rules. Sell and rent back scheme rules can be complicated to follow for those selling a house. To make matters worse, they all use a different set of criteria and rules.

A sell and rent back scheme will allow those selling a house to avoid estate agent and legal fees, but most schemes will only offer 75% of the open market value. However, a quick house sale from a property cash buyer can help families avoid property repossession.

Those struggling to prevent property repossession should check to see if they have an unlawful mortgage agreement. This could mean that a homeowner is entitled to compensation or even the write-off of the full debt in certain circumstances. This also applies to illegal loan agreements and unlawful credit card agreements.

Interview Your Prospective Agent–The RIGHT QUESTIONS!

Interview Your Prospective Agent–THE RIGHT QUESTIONS! If you have made the decision to list your property with a real estate agent you’re are one-step closer to the sale of your property…but don’t walk too fast—deciding to list is one thing…picking the right agent is another.

It is crucial that you ensure that you are picking the agent that is best suited to meet your needs. Many people choose a friend that happens to hold a real estate license–but have another primary occupation. That is a huge mistake and, typically, the end of a good friendship.

When choosing an agent keep your eyes and ears open to what other people have to say about their experiences with a particular agent. Look in local real estate magazines and see who seems to specialize in home that sell with in the price range of your home. And most importantly, do not forget to interview several top agents, and pick the one you feel most comfortable with.

So many homeowners are timid when it comes to interviewing agents–in fact, they think the agent is interviewing them–that is not true! You are the employer, they are the employee–you call the shots.

Here are some questions I feel should assist you in finding the right agent:

  1. How long have you been selling residential real estate? Try to find an agent that has been in full-time practice with the same firm for three years. I recommend the same firm because successful agents do not hop from firm-to-firm–the only exception would be if they left a firm to open their own.

Agents that hop around do so because they were not getting the business they expected –I have news for them–it is usually not the firm, it is the agent! Avoid them.

  1. Do you work full-time? As mentioned above–no part-timers.
  2. How often will you communicate with me? A common problem with listing agents is that they take a listing and the homeowner never hears from them again. The agent explains to the homeowner that they were too busy trying to sell their home–hogwash! An agent must be willing to guarantee you that they will communicate with you atleast every ten days.
  3. Are you a member of the local Multiple Listing Service? Be sure that your agent is a member of the local MLS service–this places your property information at the fingertips of all of the agent-members in the community. It is an essential marketing tool.

Reasons for Making a Spanish Will: Protecting Beneficiaries When Owning Real Estate in Spain

Spanish inheritance law is decidedly different from the laws of the US and the UK.

  • Children have a statutory right called legitima to a big part of the estate. They cannot be disinherited or excluded except in very rare circumstances.
  • Surviving spouses do not automatically inherit the holiday home foreigners often purchase in Spain.
  • Spanish wills are drawn up in a different form and probate can get very complicated.

Overview of Spanish Inheritance Law

Children have a very strong position in Spanish inheritance law. The basic rules and laws are contained in the Codigo Civil, which came into force in 1889 iand is still applicable in the modernised version.

It gives children a compulsory right to the biggest part of the estate of a deceased parent. This right can only be taken away from them and their legitima be overruled, if the child in question has committed a serious criminal offence against the parent such as armed robbery or a murder attempt. It can easily be seen, that such cases will be very rare.

Likewise, the surviving spouse has a right only to part of the estate together with the children. A foreign property owner who has for instance acquired a holiday villa or apartment, often in joined names with a spouse, may wish that the property goes straight to the surviving spouse and not to the children. The only way to achieve this is to make a Spanish will.

How to Make a Spanish Will

Spanish law does recognise a hand-written will, but the formalities are very strict and a foreigner will not know about them. Additionally there is the problem of language, witnesses and, in the case of demise, how the handwritten will can be probated. This involves the court, translators and often legal experts, which alone shows the problems, costs and time the probate of such a will requires.

The best and easiest way to ensure that a valid Spanish will which reflects the wishes of the testator and complies with Spanish law is to make a testamento abierto before a Spanish notary public. The notary public plays an important role in Spanish legal life, not only with the acquisition of a Spanish property but also with the making of a valid will and its execution.

In practice, the Spanish lawyer will meet with the client, draft the will and then present it to the notary where the document will be checked, copied onto numbered paper and executed in the presence of the notary and the necessary witnesses whom the notary will often provide.

A valid Spanish will, executed in this form, will include the crucial clause that the testator has taken care of the legitima in a separate will made in the country of origin and that the Spanish will is restricted to his or her Spanish assets, be they real estate, chattels or money in the bank. The will is written in two columns, one in Spanish and the other in the testator language and an interpreter will be present and confirm a valid translation with his signature.

The notarial will has the added advantage that the notary will lodge a copy with the Registro Central de Ultimas Voluntades in Madrid.

Probate Procedure In Spain

Any probate procedure starts with the application for a certificate from the above register to see, if the testator has made a will. The notarial testament will of course show up and the beneficiaries can proceed with their probate without delay. Again, this is done by the notary in what’s called Escritura de Acceptacion y Adjudicacion de Herencia. Once this document has been executed and death duty, if applicable, has been paid, the beneficiary will be registered as the new owner in the appropriate land registry.

The foreign will has no bearing on this procedure and probate will be dealt with in the deceased’s country of origin.

Considering the problems which can occur, not to mention the time and possible costs, it makes great sense and gives every foreigner owning property in Spain peace of mind to make the effort and pay the small fees to execute a valid Spanish will at a notary’s office.

How to Buy Property in Turkey: Vacation Homes and Holiday Flats are Increasingly Popular Here

For years Turkey’s holiday towns of Bodrum and Marmaris have been popular with holidaymakers. But now the possibility of buying homes in Turkey is causing many people to look again at the country.

An increasing number of property buyers keen to find investment property at more affordable prices are looking for flats and holiday homes for sale in Istanbul.

The ancient link between Europe and Asia and the only city to straddle two continents, Istanbul has been is famous for its Blue Mosque the capital of the Ottoman and the Byzantine Empire over the centuries. Imbued with history and romance it might be, but this vast metropolis with a growing population of nearly 15 million is now a forward looking, modern city attracting young people and international companies.

Although there is still some political volatility, the growing prospect of EU membership has boosted the Turkish economy. Inflation has fallen to its lowest level for 30 years and Gross Domestic Product has grown 7.4% per year since 2002.

It’s Getting Easier to Buy Property in Turkey

A land registry has now been established to help verify and regulate ownership and restrictions on foreign purchasers buying real estate Istanbul have been relaxed. British buyers are now the second largest group of foreign property owners in Turkey and PriceWaterhouseCoopers ranked Istanbul top for development prospects in its 2007 Emerging Trends in Real Estate Europe report.

Despite rapidly rising prices off-plan apartments are available in large suburban developments for as little as £25,000. These developments are popular with middle class Turkish buyers and investors. Areas such as Umraniye and Atasehir on the Asian side of the city and Bahcesehir on the European side are attractive areas to buy Istanbul real estate. Other, more central districts of the city are also on the up, albeit slowly.

The prices in Istanbul are similar those you could find in parts of France, Spain and Italy 10 years ago so there is a lower price entry point for investors. People are also getting more adventurous these days and looking beyond Bulgaria and the Balkans which naturally brings them to Turkey, according to property developers Regnum LINK which specialises in Turkey.

Property ownership is low in Istanbul and young people are increasingly coming to work in the city so there is always potential in the rental market – especially for studios or one bedroom flats in the suburbs.

Holiday Homes in Istanbul

Older houses in the city are also now being refurbished. The Akaretler project in the Old City near the Bosphorus strait involves the redevelopment of a group of 19th century houses once used by craftsmen building a palace for a Turkish Sultan. Neo-classical in design, they are part of a shopping development. In the city that invented the shopping mall with the centuries old Grand Bazaar this is a common practice.

New shopping malls are being built at a rapid rate. Currently there are roughly 179 with more on the way. In these areas demand for residential property is outstripping supply.

Once regarded as a second world city, Istanbul is working to improve its residential accommodation. According to property consultants King Sturge, LINK demand for quality stock remains strong, fuelling price rises. This is, in part, a recognition that much of the older housing stock is of poor quality combined with a greater understanding of the risk of earthquakes but it is also fuelled by increased wealth.

The mortgage market is only just starting in Turkey but this situation is likely to improve very quickly, experts believe. Typical interest rates are about 5.9 to 6 per cent and the normal loan to value ratio is 75 per cent. Bear in mind, though, that the range of mortgage products will not be as wide as in the US or UK.

Tax and Real Estate Investment in Turkey

Purchase fees amount to approx 3.5% of the property value. The principal taxes include personal income tax in either Turkey or the UK as well inheritance and succession tax. Properties are subject to the Istanbul equivalent of Council Tax – rates vary here. If an owner sell real estate within four years they will also have to pay capital gains tax in either Turkey or the UK.

investment

Investment Fundamentals in Real Estate

News outlets constantly report on jobs, housing prices, housing inventory and a myriad of other factors that affect the residential real estate market. With every data point it seems like the stock market moves up and down in a ratcheted fashion as if the latest data point has solidified the recovery or the doom of the market. Smart investors would be wise to look at trends and to always remember, real estate at its core is an investment in a location.

Investment Fundamentals – Jobs and the Economy

Jobs and retail sales can be a good barometer of the national economy. If people are employed and spending money, it is generally a good bet that the economy is doing well. This is a positive sign for real estate, but here is where the local part comes in. Cities like Detroit and Cleveland know all too well that they are not represented by national statistics.

This is not to say that national statistics do not affect the way people think, act and feel locally, but investors are best served by knowing how their markets trend with the broad nation. Recoveries in cities like Los Angeles and New York will be leading indicators, while second tier cities like Chicago might be several quarters behind.

Furthermore, the speed of recoveries also depend on the fundamental (or lack thereof) reason for the initial inflation. Consider a city like Las Vegas. This city began to see economic gains because of increased tourism; however, as the local economy begin to pick up steam, construction quickly became the growth engine. With the construction enormous casinos and the real estate development boom, Las Vegas became a city of physical labors. Even as tourism began to dip, the city continued to prosper because of this false economy.

Finally, disaster struck when many casino projects were cancelled and the local residential real estate market crashed. With no more construction jobs, the emigration began in earnest, leaving the economy short of people and jobs. Even as tourism returns, the residential market in Las Vegas should expect a much slower recovery than the greater economy because of its unprecedented rise.

Investment In Local Real Estate Fundamentals

Investors can profit from understanding the disconnect between market realities and market perceptions. Becoming familiar with the real estate drivers of a local market can help an investor understand when it’s time to buy and when it’s time to sell. Even today, markets like Houston show strong fundamentals and did not suffer from the same drop as other major markets. Growth in this market may be unduly muted because of general economic trends. Local investors would do well to invest today and wait for the market to validate their conviction.

Don’t be swayed by national real estate statistics. Real estate is 100% local. Use this knowledge to profit from local mis-pricing when the greater economy becomes too hot or too cold.

real estate

Real Estate: Another Way To Get Rich

Property options are one tool in the real estate investor’s toolbox which is an amazingly powerful way to control property without actually having to pay for it. Sure, a small payment is made and a contractual agreement is reached. However, in essence, if you have an option over a piece of real estate, you have more control over it than the registered owner of it.

Real Estate Is A Fickle Mistress

Real estate options have been used widely in the past, but surprisingly sparingly these days, probably because most people don’t know how it works, and find the whole process a bit too difficult. That’s a bit of a disappointment because they can be a great way for real estate investors to expand their portfolio, and build their wealth. That’s why I learned how it works, because I saw the potential and I got a little excited.

Let’s say for example you come across a property that’s a little run down in an area that’s experiencing decent population growth. Since the owners bought the house a decade ago, real estate prices have not quite doubled in the area. After talking to the couple you learn that they would like to sell really because they need the money, but are a bit fearful of the process and what price they might get for the property. You decide that you might like to buy the property, and that it has the potential to rise further in value. So you buy an option over the property – you pay them say $2,000 today in exchange for the right to buy the property at a set predetermined price (say $250,000) in the future (say the next 2 years).

Selling A Property You Don’t Own?

The best thing about options is that the terms are totally negotiable between the parties. The time limit to expiry of the option may be different – as may the dollar figure, but the principle remains the same. You now control that property and it cannot be sold while you hold that option. So this allows you to then go and seek out a buyer for the property and sell it. But how does that work – how can you sell the property if you don’t actually own it? Easy!

Say six months later you find a buyer for the property – and you negotiate a price of say $300,000 for the property. Great! You hold the option over the property right, so you tell the owners, it’s time to go, this is what’s happening, I’ve found a buyer, isn’t that great! They’re happy because they have the $2,000 you paid them for the option, plus you give them the set price for the property, being $250,000. They’ve made a tidy sum in capital gains over the period they’ve owned it. You’re happy too, because you get the $300,000 from the buyers! Deduct the $250,000 you give the owners and the $2,000 for the option, that’s a profit of $48,000 in 6 months!

Real estate options can and do work for many real estate investors and businesses, but you must be sure of the laws in your own state or territory. This is one of those investment areas where it makes good sense to lean on your team a bit. Use your lawyer to draw up the contracts and real estate contacts to source out buyers and sellers. Sometimes you’re just the person to marry them up – for an option and a fee of course. Enjoy!