Best Investment to Make With $1000 or $2000? A Credit Card Condominium!
Best Thing You Can Buy With $1000 or $2000? A Place to Live!
This is an unusual investment where credit doesn't matter and one needs anywhere from zero to $1000 dollars to-$5000 to invest or "put a condo on a credit card".
I will not love my first condo. I will love the low rent, and the freedom my condo provides!
Investigate real estate agents/brokerages in your area, dealing in problem properties.. Identfy ten agents specializeing in distressed properties who will commit to finding you a condo for sale by an eager seller.
Tell the agent/broker, you plan to live in the condo, and that you want to remodel it. Do not tell them you have no money..or they will not help you find a ' deal like this as they will think a deal like this cannot be done! Some agents believe in deals like this but many don't.
Many agents do not understand investors or sometimes they don't know that much about financing and they think buying something in the way described below is illegal.
Most important: tell the agent that you want a distressed seller who is the owner of this property. This is a seller who either is in a hurry, or is tired of trying to sell an unsaleable property.
NOTE; The real estate agent will try to talk you OUT OF BUYING THE CONDO! They will tell you "nobody" buys condos and that "you cannot sell" a condo. They are wrong. Do not be proud. Remain focused.
Call these 10 AGENTS EVERY WEEK to ask them if they have any distressed condos. The first few weeks these agents might not have anything for you. After you keep calling them once a week every week they are going to get the idea that you really want to do this and you are serious.
Go and look at the condos they show you. It took me 9 months to find my "deal" condo. I called my 10 agents every single week without fail.
Goal: find the WILLING SELLER!
Most people do not want to buy a home until they have enough money to buy the "right' thing. Doing it "right" means the big mortgage, the right job, blah blah. This will not make you money because the day will never come when they have enough money to buy the perfect home, and if they did buy it, there is a big mortgage. We do not want that scenario.
Buying a condo is an unusual and fun investment and a low mortgage is what you want for cheap living and this is why one needs to buy condos. Do not listen to friends, neighbors, and real estate agents who will tell you people not to buy condos because they think that are hard to sell. Plenty of people buy condos.
Whether you are a student, or an investor, you will buy something you can MAKE liveable. That is how you live cheap and make some money. I once bought a one bedroom condo which had 5 people living there who were SMOKERS and the place smelled! The landlord could not sell it. I gave the landlord via the brokerage $2000 and took a $2000 advance on a credit card. Total damage to me=$4000. The condo title was put into my name. I did NOT assume the mortgage.
The mortgage was left on the property by the old landlord/owner. I began making payments on the existing mortgage. Many people will tell you this is illegal. I invite you to Google it and see for yourself. The mortgage was 13 years old and it was a $28000 mortgage balance. The interest rate was 10%, but the fact that it was 13 years into the loan meant a larger part of the payment was going to principal each month.
The monthly payment was about $232 and this was in the San Francisco Bay Area, where rents for the same type condo were around $900. This was in 1998. There are better deals in 2012. Looking back, I probably could have taken the condo over with no money at all; the owners just wanted OUT. I was just not gutsy enough to offer to take it over with NO MONEY.
I paid the existing mortgage on time each month and after 3 years refinanced. During the 9 years I lived there, I painted, instlalled floors, remodelled the bathroom and the kitchen, paying cash for all the remodelling. I went to school. I became the homeowner president of the homeowner assiciation, and we fixed up the entire condo complex, which brought up the values of the condos throughout the whole complex.
I had a cheap place to live in a convenient location and I didn't have a LANDLORD. I sold the condo at the real estate peak. Best way to find a cheap place to live. I saved a pile of money on rent and learned about homeowner association corporate management.
The best part is I made several friends and lived relatively stress-free. I highly recommend it.
Could the bank have "called" the loan due? Sure, but why would they? I was making the payments ON TIME on 10% interest. They would be NUTS to call the loan.
For those of you who want to build a real estate rental empire, the link below will help you figure out how to calculate a solid rental rate return: http://doodlehead.hubpages.com/hub/Rent-Returns-of-30-Percent
Have fun doing this. Good Luck!