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HomeRun Homes is a centralized marketplace which helps people Find or Sell a Rent to Own Home, both Nationwide and Globally to the thriving Rent to Own Market. http://www.lease2buy.com
Showing posts with label real estate investors. Show all posts
Showing posts with label real estate investors. Show all posts

January 17, 2012

From A Sad Foreclosure To A Happy Home

Hi Everyone,
   Hope you had a nice long weekend if you had yesterday off, and a belated tip-of-the-cap to Dr. Martin Luther King for the peaceful way that he traveled to bring equal rights to African-Americans, and to bring peace amongst the different races of people on our little planet.

   Back in late summer, I wrote a post titled, "Feds Finally Keen on Rent to Own Housing", where we discussed a possible Government program aimed at selling bundles of foreclosed homes owned by Fannie Mae (FNMA) and Freddie Mac (FMCC), to real estate investors, with the properties converted into rentals. The key point here is that these homes will be sold in bulk vs. individually.

   Fast Forward a few months, and the Government is hoping to "launch a pilot program in early 2012 to convert government-owned foreclosures into rental properties", in a story by Tami Luhby for CNN Money. Just last week, Federal Reserve Chairman Ben Bernanke cited the program as a possible way to help us get through the housing crisis, and per the article by Luhby, titled, "Turning foreclosures into rentals", Bernanke said that "Restoring the health of the housing market is a necessary part of a broader strategy for economic recovery".

   After dropping mortgage rates down to historic lows, the Fed started thinking "outside of the box", and needed to find creative ways to solve the crisis. Perhaps after a prolonged stall in foreclosure procedures, the Fed sees the wave of foreclosures coming in their crystal ball, and as Luhby writes, there are close to 2 million homes in the late stages of delinquency, according to Lender Processing Services. These foreclosed properties can destroy home prices since they "often sell below market value", says Luhby.

   By converting these homes to rentals, the neighbors are happy, the Fed is happy, and things can start looking better for everyone. What are your thoughts?

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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #MLK #MartinLutherKing #AfricanAmerican #RenttoOwn #FannieMae #FNMA #FreddieMac #FMCC #realestateinvestors #FederalReserve #foreclosedproperties #homeprices

December 15, 2011

Real Estate Can Make You Do Crazy Things

Hi Folks,
   Hope you're having a great week.

   It's nothing new to any of you reading this that Real Estate is a great way to make a lot of money, if done right with a cooperating market. However, there is also an under-current of those that use fraud, manipulation, and other schemes to scrape funds from people with blatant disregard for the law.

   For example, there were 4 such incidents that popped up in the news this past week, one involving a Real Estate Broker, one involving an Internet Scam, another involving some Real Estate Investors, and yet another one overseas, just to show how far-reaching this issue goes.

   To be specific, a Real Estate Broker in Phoenix was convicted for evading over $3 Million in taxes from land sales and broker commissions, while some guy sold property in Alabama...property he didn't own and never gave up the Title for once he was paid! The story involving the Real Estate Investors was related to fraud and bid-rigging at Public Real Estate Foreclosure Auctions in California. The overseas one that I referred to above was in New Zealand, where a real estate salesman misled a buyer and failed to pass on an offer made by another buyer.

   I'm going to assume that overall, people are "good", however, with the markets the way they are right now, there are a lot of desperate folks out there, and a lot of people waiting to pounce on them like prey. Of course, everyone is innocent until proven guilty, but the sheer spike in these stories tells me that this is a trend that will continue in tandem with the market woes.

   The lesson here: Caveat Emptor, or "Buyer Beware". Do you have any similar stories to share with our readers?

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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #RealEstateBroker #RealEstateInvestors #taxes #landsales #bidrigging #RealEstateForeclosureAuction #California #NewZealand

November 2, 2011

What is ROI and Why is it Important to You?

Hi Folks,
   Hope you're having a great week!

   Today, we are going to look at a very important calculation used by Real Estate Investors to gauge and measure potential investments. The calculation that we are going to look at is Return on investment (ROI), with which some of you may already be familiar. At the risk of going too deep into formulas, we are going to just touch on the topic, and provide you a good framework to decide if you want to research it further.

   ROI, which is expressed as a percentage (%), is the % of money that goes back to the investor (after taking into account the actual cost(s) of the investment), or Gain from Investment minus Cost of Investment, divided by the Cost of Investment. This is a very basic way of figuring ROI, but there are more complex ways to compute it, taking into account repairs, etc, but this is outside the scope of our basic discussion here today.

   What are some of the complications in calculating ROI?

   As Marc Davis writes in his article, "How To Calculate ROI For Real Estate Investments", for the Investopedia website, there are complications in Calculating ROI (some more complex than others). Some examples he provides are if the property is refinanced, if the property was bought with "an adjustable rate mortgage (ARM) with a variable escalating rate charged annually", and if there is an increase in maintenance costs, utility rates, and property taxes,

   Davis points out the following tip; "For income tax or capital gains tax purposes, however, real estate property owners are urged to get professional tax advice from a reliable source before filing". Sound advice.

   Do you use ROI when making a decision regarding your investment(s) in Real Estate? We'd love you to share your comments.

Would You Like Our Blog Posts Sent Directly to your E-mail? Here's How:
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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com


TAGS: #ROI #RealEstateInvestors #Returnoninvestment #ARM #adjustableratemortgage #propertytax #capitalgains #property

October 31, 2011

Is Owner Financing In Jeopardy?

Hi Everyone,
   Happy Halloween. Yes, today I turned 40...black cat is out of the bag. To stave off any possible jokes; NO, I was not born with a mask on!

   One thing that does frighten Real Estate Investors, however, is the fact that there is a new Government Act that jeopardizes the Owner Financing Investment vehicle. Taking a step back, Owner Financing is exactly what it sounds like; the owner of the property (or another company such as an "Escrow Company"), handles the payments, which is referred to as "servicing" the payments. Dolores Demers, the president of the Las Cruces Association of Realtors (and works with Re/Max), says that, "Owner financing has worked well for generations in this country", and that it has been a great option for, "innumerable buyers who are capable of making regular payments on an amortized loan, but who don't qualify for traditional mortgage loan products". However, as DeMers writes in her article, "Real Estate View: Dodd-Frank Act puts owner financing at risk", for the Sun-News, "parts of the Dodd-Frank Act will severely restrict owner financing and will do harm to buyers and sellers"

DeMers points out a few highlights from the Dodd-Frank Act that will raise eyebrows:

* The seller cannot be the builder of the home being financed.
DeMers ask the following question: "Why would the government want to restrict a builder from selling his own product" on terms that are "satisfactory to the buyer"?

* The loan must amortize fully with no balloon mortgage allowed.
DeMers says that most sellers offering owner financing are "older than 50", and asks rhetorically, "How many are going to outlive a 30-year note?". There must be a short term balloon in case the seller wants to sell to another party (and not have to "steeply discount the note".

* Buyer has three years to rescind the sale. The seller must document the buyer's ability to pay using underwriting requirements consistent with the Truth in Lending Act.
"If the seller makes even one small error, the buyer has up to three years to rescind the sale and demand back all the money that has been paid to the seller", says DeMers, regardless of "the benefit the buyer has gotten from the use of the property during the time he had it". This is, in no uncertain terms, "Not Fair".

* Only buyers who are already eligible for conventional financing will be able to use seller financing. The seller must determine in good faith the buyer's ability to repay the loan.
Wait...isn't Owner Financing supposed to help those who cannot pass the "underwriting scrutiny of the Truth in Lending act". As DeMers says, "The buyers who need the helping hand of owner financing won't be eligible."

* Seller limited to three installment sales per year. A seller must become a licensed mortgage loan officer if more than three properties are sold in a year using owner financing.
DeMers says that there are many people in her state of New Mexico that have, "helped the people in their communities get started on the path of home ownership through owner financing", and asks what difference does it make "how many properties are offered as installment sales in a year as long as the seller has determined each buyer has a reasonable ability to repay the loan?". Very good point.

   The summary of this is that DeMers is trying to stir some action against this "sweeping rule change", and we agree. These alternate means of buying (or selling) a home are what gives people hope and a chance to move forward. She adds that the "Dodd-Frank Act treats owner financing as if it were predatory lending", which it is not. She also recommends that you contact your elected officials to protest the Act. I agree. Good point. Stand up and be counted !

Would You Like Our Blog Posts Sent Directly to your E-mail? Here's How:
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Have a Great Weekend, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #OwnerFinance #Financing #realestateinvestors #DoddFrankAct #balloonmortgage #TruthinLendingAct #Escrow #Realtors #installmentsales #Halloween

September 15, 2011

Investors vs. Home Buyers in the Foreclosure Arena

Hi Folks,

   Glad you're back with me.

   It had to happen. It was inevitable. Investors and Home buyers are going head to head. "Home buyers find themselves aced out by investors", a recent article from Eve Mitchell of the Contra Costa Times, states that home buyers are being "edged out" by a growing number of "absentee buyers" (those who don't plan to live in them).

   How is this happening? Real Estate Investors are gravitating toward low-end properties, says Mitchell, and says that these are the same homes that first-time and move-up buyers want. Linnette Edwards, an East Bay associate broker with Better Homes and Gardens Real Estate, adds that "Most of the investors are buying into the first-time home buyer price range of $200,000 to $400,000". Mike Sibilia, a South Bay broker with Keller Williams, points to the all-cash purchasing factor, and says that "The investor has the cash wherewithal to be able to close on the property without the risk of the seller worrying about whether the buyer can get the loan or not". Sellers that own foreclosure properties and banks that own foreclosure properties, or "REOs", prefer all-cash buyers because "the deal can close faster than a transaction involving a loan, say real estate professionals".

   As difficult the competition is for these home buyers, Mitchell informs us that this trend is clearing out some of "the glut of foreclosures dragging down home prices". According to Housingwire.com, there is and will be more "glut "coming.

   Jon Prior wrote a recent article titled, "Foreclosure starts spike in August", which looked at recent figures released by RealtyTrac which indicated that mortgage servicers started the foreclosure process on 33% more homes in August than the month before, which was the biggest monthly increase in four years. James Saccacio, the CEO of RealtyTrac, stated that the increase in new foreclosure actions may be "a signal that lenders are starting to push through some of the foreclosures delayed by robo-signing and other documentation problems", and that "it also foreshadows more bank repossessions in the coming months as these new foreclosures make their way through the process."

   Advice for home buyers? Stick it out, hang in there, and keep "Swimming with sharks", as Mitchell's article named it. Advice for banks? Loosen up a little credit and lend some money !

   I welcome your comments !
Would You Like Our Blog Posts Directly to your E-mail? Here's How:
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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #RealEstateInvestors #Foreclosurestarts #mortgageservicers #bankrepossessions #absenteebuyers

March 2, 2011

Donating Services to Wounded Warrior Homes

Hi Everyone,

   Today, we are extremely proud to announce that we have made an agreement to donate our services to the Wounded Warrior Homes Organization, which is a fantastic charity that helps severely injured Armed Forces members get back on their feet and to find housing.

   We have distributed a Press Release regarding this in order to make more people aware of this great organization. For your perusal, please see a copy of the Press Release below:

For Immediate Release:

Robert Eisenstein
HomeRun Homes
(631) 676-3609
(631) 574-2420
http://www.Lease2Buy.com

HomeRun Homes Donates Services to Wounded Warrior Homes Organization

Ronkonkoma, New York, March 2, 2011 - HomeRun Homes (www.Lease2Buy.com), the Rent to Own Homes classified ads website, has contractually agreed to donate blocks of ad space to the Wounded Warrior Homes Non-Profit Organization (www.woundedwarriorhomes.org).

Giving Back To Those Who Give Us Freedom

Wounded Warrior Homes was founded by Steve & Mia Roseberry with the goal of supporting military members who are dealing with Traumatic Brain Injuries incurred from serving our country. Steve Roseberry has a background as a General Contractor and as a Home Inspector, and Mia Roseberry is a special education teacher familiar with the struggles faced by those with Traumatic Brain Injury. Working as a team with their non-profit organization, their number one priority is to use their skills as real estate investors to help provide transitional housing to service members with Traumatic Brain Injury.

HomeRun Homes, about to celebrate their 9th Anniversary, is billed as "The" Rent to Own Homes Marketplace, and has been uniting buyers and sellers of Rent to Own Homes via their classified ads since 2002. Robert Eisenstein, the CEO & Founder of HomeRun Homes, states that HomeRun Homes "is very proud to announce a partnership with such a fantastic organization". Eisenstein points to the fact that his Paternal Grandfather served in the U.S. armed forces during World War I, and that his Maternal Grandfather was one of our troops that, "stormed the Normandy beaches during World War II", adding that he, "proudly displays his Grandfathers' honorable discharge papers with citations as an expert marksman."

As part of the agreement between HomeRun Homes and Wounded Warrior Homes, HomeRun Homes is providing blocks of Advertising space across multiple categories, and Eisenstein has personally offered to speak to the warriors themselves to provide them with tips on the Rent to Own process. "To this day", says Eisenstein, "I still have family serving in the Armed forces, so this charity just feels so right!".

For additional information on the topic, "HomeRun Homes Donates Services to Wounded Warrior Homes Organization", please visit http://www.Lease2Buy.com

ABOUT HOMERUN HOMES

Founded in 2002, HomeRun Homes is a Centralized Marketplace which helps people Buy or Sell a Rent to Own Home, a Commercial Property, or to offer Home Services nationwide and globally to the thriving Rent to Own market

- END -

Have a Great Day, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog http://blogging.lease2buy.com
HomeRun Homes Website http://www.lease2buy.com

TAGS: #renttoown #military #realestateinvestors

December 13, 2010

Giving Back to Our Wounded Warriors

Hi Everyone,
   Hope you had a great weekend.

   As we all know, this is the season of giving, and today, we'd like to discuss a charity that we believe is worthy of your donations. The charity I am referring to is "Wounded Warrior Homes", and basically, the vision of this non-profit organization is to provide fully furnished homes (including sheets, towels, and the first 2 weeks of food), in which each military service member, "will rent a private room at below market rent and have the sense of ownership." In addition, the service member is connected with a case manager, along with "educational and job training options" and will, "begin working on their individual transition plan toward independence in 2 -2 1/2 years or less."

   Wounded Warrior Homes was started by Steve & Mia Roseberry, with backgrounds in General Contracting and with special education, respectively, and as they state on their website, their effort is to, "use their skills as real estate investors to help provide transitional housing to service members with Traumatic Brain Injury."

   This is a fantastic charity, and something that I thought would be great idea to announce here on this Blog, since their vision runs along the lines of the business of housing in which we are all involved in, either directly or indirectly.

   When you have a chance, take a look at their website, and see how you can help our heroes gain back their lives after defending us with their own lives!

Have a Great Week, and Happy Rent-to-Owning !
HomeRun Homes Blog http://blogging.lease2buy.com
HomeRun Homes Website http://www.lease2buy.com

November 26, 2010

UPDATED: Post-Foreclosure REO Property Maintenance

Hi All,

   I hope you had a wonderful and relaxing Thanksgiving dinner, and we are glad to have you back here with us today, from wherever you may be reading this.

   We have had a tremendous amount of requests to cover the topic of REO properties and the manner in which they are kept from becoming eyesores and danger zones. In order to garner the best information, we spoke with a few people who deal with REO properties on a daily basis, and we have received some valuable information from them that we would like to share with you today.

   How are Foreclosure/REO Properties being Maintained in while they are Unoccupied?

   Edward Harris, Owner of REO Clean Up, tells us that the REO maintenance process for his company starts once the, "HUD/Bank receives a foreclosed property into their inventory and that property is turned over to their integration contractor/Broker.". Once they receive the property they send his company a "work order to go out and perform an, 'initial inspection'." Harris say that this report provides detailed information of anything left behind by the previous owners and also any visual problems with the home. The next step after this report is sent back to the IC/Broker is that a, "a work order is generated from the 'initial inspection report' regarding any issues. This work order is referred to as. 'Initial Services'."

   Another professional we spoke with, Mia Melle, President of West Coast Property Specialists, says that, "How these properties are managed during times of vacancy differs from company to company and also depends on what the owner intends to do with the home - rent or sell or sometimes nothing at all.". Melle provides an example of Fannie Mae, which, "uses the agents who are going to list the home as interim property managers and usually they are unpaid!", so basically it is the listing agent's responsibility to, "coordinate lock changes, landscaping, board ups, etc.", and surmises that the fact that they are unpaid for this service, "speaks to the fact that so many homes go uncared for and turn into neighborhood eyesores."

   Adam Roberts, a Community Development Loan Specialist in the St. Louis/Midwest Region, concurs, and says that, "many of the REO properties are not being maintained to a "neighborhood friendly" level. Lenders are neglecting to manage these properties because there is an overwhelming(ly) large number."

   Melle says, however, that she has seen other types of financial institutions use property management companies to handle their vacant inventories but she reiterates that, "the companies are often doing this for the opportunity to either list or manage the property in the future and are offered next to nothing (in) compensation to oversee the homes."

   Who is Keeping these Properties from Becoming Overgrown?

   Harris says that once his company receives an "Initial Services work order", they perform the following; "trash out services, Janitorial, grass cut and any safety issues are given immediate attention. Once we receive a work order the property is in our inventory for routine services until the property is sold." He says that "Routine Services includes bi-weekly visual inspections, grass cuts, picking up any trash, re-fresh janitorial cleaning, re-fresh of winterization during the winter seasons, snow removal", and, "If a roof problem for example, is found during a routine inspection I would have someone rectify the problem ASAP."

   Roberts says that "fortunately" through local law enforcement and code enforcement the properties have some maintenance such as, "occasional lawn mowing and boarding up windows and doors." Still, however, Melle says that, "Landscaping is one of the issues that lack thereof is the most noticeable to the neighborhood and it's one of the harder services to obtain for anyone whether you are a bank, property manager, or listing agent.", and says that, "The reason for this is that gardeners are a very local type businesses and you cannot find them on the Internet, the yellow pages or elsewhere. Normally, if you live in the neighborhood they will drop a flyer off at your door periodically but other than that.they are extremely hard to locate and hire from off site. So, as a result the landscaping may or may not get done regularly or at all.", and says that, "It's definitely an issue that we've had in our company with these types of portfolios."

   Who is Protecting these Properties from being Burglarized (for Copper Tubing, etc)?

   Harris says that during the "initial inspection", the property is secured, locks changed, hasp/pad locks if needed.", but he says that, "Obviously we can’t have someone at the properties 24/7, the visits of the routine inspectors and neighbors aware of the home can be/hopefully a deterrent for any theft. But if there is a burglary we notify the authorities, find out how the burglar got into the home and re-secure the property."

   Roberts concurs and says that Local law and code enforcement, "report the break-ins and then requires the lender to board up windows and doors.", and that, "Unfortunately after this happens the home becomes unmarketable to "real people" and the best chance of the home moving on the market is now in the hands of an investor, which means another short sale."

   Who is Keeping Squatters from Living in the Property?

   "There have been cases of squatters but not many with our company.", says Harris, who continues to say that, "If our routine inspector doesn’t find evidence of a squatter then we are called by a neighbor. Keeping the squatters out can sometimes be a task." Harris says that, "At one property, the squatter broke the door three different times. The first two we re-hung the door and put two padlocks and hasp on the door. The third time our inspector arrived for his routine inspections and found the person in the house and was able to call the police. They were able to apprehend the squatters." On a positive and hopeful note, Harris says that, "Our continuous presence at the properties we hope prevents illegal activity."

   Roberts says that, "Unfortunately these homes are sitting unoccupied for extended periods of time which makes them highly susceptible to burglary and squatters." He says that, "After initial vacancy the home has windows and doors, (and) in a few months, squatters and burglars target the home. They begin by stealing the air conditioner. Then when they realize neighbors are too scared to come out and confront them, they break in doors and windows and start cutting out the copper and other valuable items in the home." he says that in the end, at best, "local law and code enforcement are mandating maintenance to the best of their ability", but, "unfortunately these dismal efforts are only making the public aware that these properties are foreclosed, unsafe and jeopardizing the stability of the neighborhood."

   How many vacant or unoccupied properties have you been seeing popping up lately? Have they been maintained fairly well or do they have the "REO 5'O'clock shadow". Let us know so we can all share some information and new ideas and strategies to help our neighbors.

Have a Great Weekend, and Happy Rent-to-Owning !
HomeRun Homes Blog http://blogging.lease2buy.com
HomeRun Homes Website http://www.lease2buy.com


TAGS: #foreclosure #shortsales #reo #realestateinvestors #realestate #propertymanagement #hud #property




UPDATED: Top 5 Blog post for 2010 (For more information, CLICK HERE)