Real Estate Investing Financing Truths - Part 2

No Money Down and other 'Creative' Real Estate

Investment Methods

For many years, investors have seen the traditional

real estate investment methods described in Part 1

of this article as a lot less than desirable!

They began looking at the prices of houses and

finding methods of bringing the price more in line

with making more money in a faster way.

These savvy investors developed ways to get loans

on properties that allowed them to pull money out

whenever they buy a real estate investment (cash

back at closing) and lower their payments to build up

their cash flow ('creative' investing).

They even developed methods of determining a

Sellers motivation for selling - and bought the

property at a discount price.

These creative investors also saw that some Sellers

were not able (for whatever reason) to sell the

property at a discount price, however, they still

needed to get rid of the property, as they didnt

know how to manage it as a landlord, or make

money from it - not that it couldnt be done, they

simply lacked the knowledge of how to do it.

The Seller just never learned how to profit from a

real estate investment.

These investors understood how to make money

from such properties, and did.

They bought the property on discount terms, and

made money from the spread by selling it at retail

price and/or terms (certainly one of my favorite

methods of real estate investing).

Buy Every Real Estate Investment via Discount Price

or Discount Terms.

Several years ago (actually, it really took off in the

1980s), Real Estate Investment Experts began

seeing the potential for making money in bringing

this treasured knowledge to the public in the form of

home-study courses, seminars and Boot Camps.

They found that it wouldn't create competition for

themselves, as many people, even though they

purchase real estate courses and attend seminars

and Boot Camps, will not actually take the

information and utilize it to make the hundreds and

even thousands of dollars possible for anyone

serious about Real Estate Investing.

These Real Estate Investment Experts (being

dubbed 'guru') found that this side of the business

was lucrative often making more income from

teaching about real estate investing than the actual

real estate investments themselves.

It is important to understand that these real estate

investment gurus learned early that they can only

teach others what to do, not be responsible for the

other persons success.

Providing the information to those that choose not

to use it is very similar to the old adage "You can

lead a horse to water, but you cant make it drink".

Yes, these real estate investment gurus got wealthy

from selling this information, but their theories,

principles and techniques taught thousands of

others (those that take action on what they learn)

how to realize their dreams utilizing their tried and

true methods of real estate investing.

From home-study courses and seminars, to boot

camps and one-on-one training, these methods

have been proven to be not only interesting to

millions of people, but capable of bringing massive

wealth to those that take action on what is taught -

those that go on and actually make real estate

investments themselves.

Knowledge changes things...

This knowledge of no money down real estate

investing techniques being known by thousands of

Sellers has made changes in the industry.

By bringing the Seller into the knowledgeable realm

of Real Estate investing, Sellers now know many of

the methods that the gurus teach.

This is both a blessing and a curse.

To the talented investor, these knowledgeable

people are more likely to work to create a WIN-WIN

situation.

Investors that avoid the tricks and stick to the basic

real estate investment techniques and terms that

have been proven to work over and over again,

have proven these powerful real estate investment

strategies work even with these informed Sellers.

Oh, yes, many of these real estate investment

techniques work today, as they have for many

years. So much so that it is almost possible to say

they have become principles; things that work, over

and over, the same way no matter what happens -

like gravity.

However, sadly, they are not really principles, as

several of the real estate investment methods and

techniques that worked in the 1980s and even

through the 1990s are today not as powerful, nor do

they work as often as they did before (although

some 'gurus' are still teaching the same methods -

even after 20 years...).

Some of this decline is due to a more educated

society (due to the flood of real estate investment

information available via books, tapes, home-study

courses and the Internet), while some of it is due to

simple changes in policies and laws.

It seems like a wave started late in 2003, the FHA

announced that flips (transactions where investors

buy houses cheaply and sell them at or near market

rates) are "illegal". (Note that illegal in this context is

not a legal term, but one that has been adopted

from "you are not allowed to do that and do

business with us".)

The FHAs announcement started a wave of concern

(if not panic) throughout the Real Estate investing

community.

Title and Mortgage companies began to tighten up

their reigns. Many of these companies, in lieu of

direct information, began simply not completing any

transactions that did not follow the traditional real

estate investment system. This made it hard for

investors to complete transactions that involved

simple buy-then-resell agreements (as they are not

really real estate investments, but a rather nice way

to make some fast CA$H!).

In rapid appreciation areas (California and Nevada,

for example), the ability to flip a property all but

stopped (became 'illegal'). All the 'traditional'

creative real estate investing methods were virtually

put on hold.

Ingenuity to the rescue, other methods of real

estate investing always seem to pop up. After all,

"Necessity is the Mother of Invention", and "Where

there is a Will, there is a Way" are absolute

principles.

Investors have to make a way to get things done - a

way to keep their real estate investments profitable,

and even more creative real estate investing

methods were developed - to keep real estate

investors, and the love of real estate investment,

alive forever.

Steve Majors - The Lazy Investor Profit from Real Estate Investment articles, real estate investing information and news from one of the most creative investors on the planet ~FREE MEMBERSHIP & real estate training course~ [http://SteveMajors.com]