Gold Or Gimmick?
Nowadays there are many commercials especially on late night television, and internet advertising promising to show you how to make millions in real estate without putting any money down. Sound familiar? These people are actually making millions of profit by selling you information that is of no use to you. You may not need an excellent credit rating and a surplus of cash to get started in real estate but you do need to know what you are doing especially if you not an expert in this field.
You could always start by making ‘quick sales’. In order to do this, you must understand the basic terminology. In short there are retailers and dealers. Retailers will buy a property and then sell on for a quick profit which is a high risk option, however that said when all goes well the reward can definitely be worth the risk. Regardless of late night real estate gimmicks, retailers normally need a very large if not substantial cash flow and an above average credit rating.
Dealers on the other hand tend to be individuals or companies that sell contracts. Normally they are attracted to bargain properties and then go on to sign purchased contracts with their sellers. The Dealers then sell these purchased contracts to retailers, which makes them a solid profit in the process. Dealers generally flip contracts for up to $5,000 without ever taking possession of the deed. Which begs the question “how a dealer would then make most of his profits? ” The answer to this question is that dealers will generally make their profits from double closing which allows the dealer to earn a higher profit. A double closing is established with the dealer signing a purchase contract with the property owner and the retailer. When this is accomplished the retailer will promise to buy the property from the dealer at a higher price and then will deposit the amount in escrow. The property owner will sign the deed to the dealer, who then signs it to the retailer. The retailer in turn will sign the loan documents, the process is then complete – the property owner is paid the price he asked for and the dealer is paid the difference. In this situation it is interesting to note that the dealer came to the table with no money, and the credit was never an issue.
There are so many ways to start a career in real estate to name but a few above.
However, it is important to keep in mind that there are ways to profit from real estate without significant financial investment, that said it is not to say that success comes free and without effort. At the very least you must be prepared to make a substantial investment in yourself which will help you to succeed and in order to be successful you must be willing to work hard. For example even with a million dollar real estate portfolio, your brain will always be your #1 asset so be sure to invest in your education on a daily basis, and ensure that you learn as much as possible about your local market, real estate regulation, and investment tactics.
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