Using Your Money for Real Estate Investments
With the housing market being on clearance sale and the stock market getting flushed down the drain, more and more people are looking for alternative ways to invest their hard earned dollar to help them catch up where their 401k (now a 101k) and their IRA’s have left them earning negative rates of return.
People are now more open to investing their money into real estate investing but often don’t know the advantages or how to get involved.
By offering private money to real estate investors you can earn far more than banks are willing to pay on savings and at extremely low risk all tax free. It is a way of investing without having to learn the market, go and find your own deals or get into the landlord trap.
There are a number of ways of participating in the real estate market without having to go out and buy and manage property yourself. You can in effect be the bank for real estate investment deals – with the same security as the bank would have.
1. You can lend money for the purchase of a property that will be rented out. You are given a note which defines the % interest rate and the time frame of the loan. You will be filed as the mortgagee at the court house and be named on the insurance policy so that your investment is secured. Interest can range from between 5-10% over a number of years.
2. You can lend money for a day in order for a back to back closing to take place on a short sale. This is where the investor has worked to get an agreement from the mortgage holder(s) to accept less than they are owed by the home owner in order for the investor to buy it at much less than the property’s appraised value. They then line up a new buyer. Your money is used to buy the property for the day of closing when the second buyer pays the new higher price immediately after the investor sale. You can earn 1.5% in 24 hours!
3. You can lend money to be used to buy a distressed property well under market value which is then refurbished (to a lesser or greater degree) and then sold on for a profit. The terms of this can vary but interest is usually accrued and then paid back in full with the principal once the property is sold.
4. You can lend money to be used for buying an option on a property which will be rented out and then sold within 1-3 years.
If you are interested in reading more about different ways of investing in real estate click here
Using your Roth IRA or 401K to Invest in Real Estate
This last year should have shown you that you need to be in control of your own financial destiny.
You can elect to direct your own IRA or 401K and invest in markets like real estate which are making much better returns than the government is currently making for you. You can roll your IRA or 401K into real estate. This is a great way of investing in real estate, improving your retirement fund and paying no tax on the real estate income.
You can also borrow money (up to $50,000) against your 401K for short term loan deals where you will be earning more interest than you pay out.
Real estate has a real growth of 6% per year over the last 160 years. It may go up and down in the short term but it always goes up over time.
Right now, in a down market there are huge opportunities for investing in short sales and foreclosures where property can be bought way under value and sold for more making a healthy profit
Tel: +1 (702) 416 4812 – Call for a PRIVATE MONEY PROSPECTUS
