Should you do your own pre-purchase inspection? Yes and no. Yes, you should inspect a house before you write an offer on it. Then you should put an inspection contingency clause in the offer, and hire a professional inspector. Why do both?

Doing your own inspection can help you get a better deal. Each cracked window or leaky toilet you can find is a negotiating point. You see, you could just make a low offer, but a seller is more likely to accept your offer if you have reasons for it being lower. In fact, you should attach a list of your concerns to the offer, as an explanation and justification for your price.

Use a list as you walk through the house. Using a home inspection checklist keeps you from forgetting things. You don’t have to know the difference between 12-gauge and 14-gauge wiring, or become an expert on all the building trades, as useful as this would be. Just use what you do know, and make a note if something looks “odd” or “smells funny.” Afterwards, you can have a professional inspector take a closer look.

Pay for a professional pre-purchase inspection. Unless you really know a lot, it can save your neck financially. An acquaintance of mine just discovered that the house he made an offer on was almost beyond hope, because their was so much termite and other damage. He backed out of the deal, and considering the tens of thousands of damage he hadn’t planned on, I don’t think he’s regretting the $300 he spent on inspections.

Do a walk-through inspection yourself, by all means. Just also put that clause in the contract allowing you to have professional inspections too. Now, how do you choose the right person to do the inspections? Carefully.

Pre-Purchase Inspection – Choosing An Inspector

For specific inspections that are customary in your area, you can rely on most reputable companies. Termite inspections are the norm here in Tucson, for example, and it’s cheap to get one done by a pest control company (they hope to get the job if there are termites to be eradicated). If the roof has obvious problems, you can get a roofer to take a look and give you an itemized quote.

For general pre-purchase inspections, though, it isn’t as easy to hire the right person. In many states it is relatively easy to get licensed for general home inspection. What you really want, though, is not someone that read the right books and passed a test, but an inspector with real life experience. Ideally, you want a former builder or tradesman that has real experience with everything from electrical work to roofing to plumbing and more.

You want to know what is wrong, but you also want to know what it will cost to fix these problems. Not all inspectors will have that information for you. Ask if they can give you estimates for repairing any problem they find, even if only in the form of a range of the possible cost. You may be re-negotiating the price based on his findings. You could call in contractors to get quotes on big problems, but you need to at least know which are big problems, and a good inspector should be able to tell you.

To sum up: Do your own walk-through inspection, then hire a professional. Ask about their experience. Ask if they can note estimated costs next to problems found. If you want to learn more, ask if maybe you can tag along for the inspection. Do these things and you’ll have a thorough pre-purchase inspection.

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You’ve sold your home and are getting ready for the appraisal. Here’s how contracts and comparable home sales impact the appraisal.

Your Contract

One of the indications of value an appraiser takes into consideration is the contract that exists between unrelated parties for the sale and purchase of the home. As odd as this may sound, sales between relatives often downgrade an appraisal amount. So if you’re not selling your home to a relative, make a nice clean copy of your contract, and give it to the appraiser who appraises your home.

Comparable Sales

In general, when you are selling your primary residence, the person buying it is going to make it his primary residence, too. An appraisal done in that situation usually gives the most value to what similar houses have sold for in the same neighborhood (or nearby) recently, and doesn’t pay much attention to the ability of the property to generate rental income or to what it would cost to replace it.

Therefore, the appraiser is going to be looking for homes which have sold in your area in the past few months. If you know of a sale of a similar home at a good price, tell the appraiser about it. Make sure your information is accurate first, however. Don’t just share neighborhood gossip. Check the sales price at the courthouse.

Be careful how you handle these last two suggestions. You want to come across as quietly helpful and factual. You do not want to convey to the appraiser that you question his ability to do his job well.

Investments in commercial real estate is good way of elevating your profits. But these investments have to be intelligent and thorough otherwise you will be risking bankruptcy. A well planned and intelligent investment can make wonders for you. Investors tend to make mistakes while dealing with commercial real estate but these mistakes can be avoided once you are clear about what you are doing. There are some hints and tips which every investor should follow in order to save his precious investments.

The most important thing is that you should be having a clear picture of the market you are dealing with. The knowledge of the market will safeguard your investment from uneven ups and downs. You can analyze the rate of progress of your investment when you know the trends in the market. It is very difficult or almost impossible for a commercial investor to earn profits from a distressed location. You will have to do some research to know the affects on local job market. Job market is found to be slow in the distressed market. So if you find a slow down in the job market in the proposed area, give a second thought about the location.

Before going for investment, an inspection of entire commercial property is recommended. You can hire a professional for this purpose as his cost will be easily earned if he advises you to buy the right property. The property where building is located must also be inspected properly by a professional to avoid any discrepancies. There are certain cases where people go for the property when they find some exiting deal and ignore to investigate about the history of the property.

Be careful when borrowing for your commercial property. Borrow according to your requirements and which you can pay back. When interest rates are lower than the return on your investments then it is advisable to borrow from the market and invest in commercial property. The earning from the property can be used to payback the interest on the borrowing. Do not forget to analyze the financial market when you have an existing deal.

Always stick to what you know. When you have experience with restaurants you should go for purchasing a restaurant. Purchase what you are acquainted with. Do not absurdly go for deals which you have no experience of.  You can go for some diversified deal if you have someone on your side to guide you during the deal and latter on also. In this case partnering with someone experienced is recommended.

So if you are intended to make lot of money in the commercial real estate market, be intelligent and thorough, think well before going for anything, follow guidelines from the professionals and experienced people, thoroughly analyze the property and financial market, go for what you are acquainted with, avoid dilemmas and stay within your budget. Remember that investment in real estate can earn you huge profits but if your investment is not backed with thorough research and experience then you can risk bankruptcy.

Are you looking to profit from the poor real estate market? If so, you will find a lot of tips and information online. Most “professionals” encourage you to target foreclosures and foreclosures alone. Yes, foreclosures have the potential to bring in significant profits, but so do short sales.

What is a foreclosure short sale? It is when the property in question will soon enter into foreclosure. The borrower fell behind on their mortgage payment and does not anticipate a solution in the near future. The property is sold for less than the outstanding mortgage. Not all lenders agree to short sales, but it is becoming a common practice. Short sales enable lenders to bypass the cost, time, and hassle of foreclosure proceedings. They lose money, but they do recoup some. Unless a lender knows a foreclosure auction will bring in more cash, they typically opt for a short sale.

As nice as it is know about short sales, you may wonder how the process got started. If you know a home seller is trying to avoid foreclosure, you may wonder if suggesting a short sale is a viable option.

As previously stated, short sales result from a borrower’s inability to pay. This is the first stage. The homeowner loses their job, receives a pay cut, loses money from the stock market, or had and another unforeseen financial complication. First, borrowers will approach their lender for help. This may include refinancing or a reconditioned loan. If denied, a short sale is the next option.

A borrower cannot decide on a short sale themselves. They must receive approval from their financial lender. This is not always easy. The borrower contacts the mortgage lender to see if a short sale is even a possibility. If it is, documentation is required. Mortgage lenders send various forms for borrowers to submit. The most important is an authorization lender for personal information. The price of a short sale property is determined by the outstanding mortgage. All prospective buyers will see your name, your address, the amount due on your loan, and so forth. The bank needs permission before disclosing this information.

A letter of authorization does not mean the short sale was approved. It is just one of the many stages. Next, most lenders require submission of income, assets, and a hardship explanation. Those who fell behind in their mortgage due to unforeseen circumstances, such as layoffs, as opposed to criminal activity, are likely approved. Mortgage lenders only use short sales when necessary. They discourage borrowers from using it simply as a way to avoid paying for their home.

Documentation of assets and proof of income is used to determine a borrower’s financial standing. As previously stated, lenders use short sales as a last resort. If these documents prove a borrower can no longer pay their bills, a short sale is likely.

The final foreclosure short sale step, which involves listing the property for sale, depends on the lender in question. Some opt for in-house selling and others turn to real estate agents. Regardless, once the lender agrees to a short sale, the property is listed for sale almost immediately.

So, there you have it. That is how a short sale property becomes. Unlike buying foreclosures, there is little to no risk of disgruntled property owners. These individuals agreed to a short sale. As a buyer, this not only means you get a home for a great price, but you should get a well-kept home with occupants who will not put up a fight to leave the property. After all, a short sale was likely their idea.

Do you want to profit from the poor real estate market? If so, examine foreclosure short sales. foreclosure short sales occur when a mortgage lender agrees, in conjunction with the current homeowner, to sell a property for less than the amount owed. For example, a mortgage has an outstanding total of $150,000; the home may sell for $125,000 or less. In most cases, just the outstanding mortgage is taken into consideration not the home’s value.

As nice as it is to know what a foreclosure short sale is, you may be looking for more information. Namely, who benefits. Honestly, everyone involved. Without a short sale, the home will enter into foreclosure. So, who does benefit and how?

The Homeowner

When a homeowner gets their mortgage lender to agree to a short sale, the home is listed for sale immediately. This is done either through a professional real estate, for sale by owner, or for sale by the mortgage lender. Since the home is reduced significantly in price, it will usually sell. The homeowner is able to escape foreclosure. Yes, they still must relocate, but they do so of their own free will. There is no formal eviction notice sent.

Since the soon-to-be foreclosed home will sell just like any other home, the homeowners are able to salvage their credit rating. Yes, it will appear that they did not pay their entire mortgage, but some is better than none. A foreclosure short sale also shows that the homeowner did not avoid the problem by hoping it went away. Instead, they took action. In as little as two years, the homeowner could get financing for a personal loan, new home loan, or automobile loan.

Most who have their homes foreclosed on, find themselves in a pinch. That foreclosure will appear on their credit report for at least seven years. This comprises their ability to get a job that requires a credit check, buy a new automobile, receiving financing for a new home, and so forth. In fact, the consequences of foreclosure are endless. That prompts may to file for bankruptcy. Bankruptcy is not the solution. It also appears on credit reports. By agreeing to a foreclosure short sale, this is all avoided.

The Homebuyer

The homebuyer, which could and should be you, benefits the most from foreclosure short sales. As previously stated, a foreclosure short sale involves selling a property for less than the outstanding mortgage. This gives you the opportunity to get a fantastic deal. Essentially, mortgage lenders just want their money. If a homeowner already paid $50,000 towards their $100,000 home, they are in a good position. They still received a good percentage of their money, but they want more. In desperate situations, that mortgage lender may accept anywhere from $30,000 to $40,000.

The Mortgage Lender

Many people wonder why a mortgage lender would agree to a short sale. Wouldn’t they rather get the full amount of the outstanding mortgage or resell the home for its appraised value? Yes, they would, but the current state of the real estate market makes this difficult, if not impossible. For that reason, most agree to a short sale.

A foreclosure short sale saves mortgage lenders both time and money. It is no secret that foreclosure proceedings are timely and costly. A home can spend months in foreclosure. A lender is responsible for all costs associated with foreclosures, including attorney fees, filing fees, and the cost of eviction. This cuts into their profits. A foreclosure short sale is a cheaper and quicker alternative.

Not only does a foreclosure short sale save a lender time and money, but it also gets them money. When the property sells, the money goes directly to the mortgage lender. Since these properties are rarely on the market for long, due to their reduced price, the mortgage lender receives their money quicker than they would through foreclosure proceedings.

As you can see, everyone profits from a foreclosure short sale. So, if you are new to buying real estate, don’t worry about the homeowners or mortgage lenders. There is no need to feel bad. Actually, you are doing them a favor and making a profit at the same time!