The process of obtaining a Federal Tax Identification Number is extremely simple and straight forward. It’s free, you can do it on-line and the entire process takes less than 15 minutes. Start by going to the www.irs.govwww.irs.gov website. In order to apply you’ll need to gather your information (social security number, etc.) Once you’ve gathered what you need, you’ll simply fill out a simple request form, known as an SS-4. It asks for basic information, such as your name, business name, address, etc. Once you’ve done that and submitted the form, the site will automatically take you to an online validation screen. IRS personnel will verify the information you’ve provided and immediately issue your tax number. You can immediately use your number, but they’ll also mail you a hard copy of your number within a few weeks.

Once you’ve done that, you can form an LLC (Limited Liability Company). An LLC is nothing more than a legal structure for your business. Instead of taking title to property in your own name, you can do it in the name of your business. You can protect yourself from some legal actions and save money on taxes by forming an LLC for your business. You’ll have to form an LLC in each state you plan on doing business. The Secretary of State typically handles formation of LLCs. A few of the smaller states don’t have a Secretary of State. In these cases, it falls to the Lt. Governor.

There are 50 states and each is a little bit different. By visiting your state website you’ll be able to link to the appropriate department and see what is required to establish your LLC. Most will allow you to apply online by filling out a simple LLC Articles of Organization form. You’ll need that Federal Tax ID number you’ve applied for, along with the names and addresses of any partners you may have. If you’re not permitted to apply online, print the form and mail it in along with the filing fee. Most states charge about $500 to establish your LLC; this will be an on-going expenses because you’ll need to renew your LLC every year by paying a renewal fee (typically about half of the initial set-up charge).

If you don’t feel competent to fill out the form, there are numerous online resources that will handle this process for you for a fee. A word of caution, though: These services can be quite expensive, so find out EXACTLY what their fees include. You don’t want to pay $1,500-$2,000 in setup fees just to find out that you still have to pay your state filing fee in addition to their fees. You don’t typically get much more for your money than you can do yourself except maybe a fancy folder in which to store your paperwork. You really shouldn’t need to pay someone to file your LLC application. The application is simpler than a standard real estate purchase agreement. You’re not planning to hire someone to write all your offers, are you?

The third and final step in setting up your business will be to go to your bank and open business checking accounts. Again, you’ll need your tax ID number for this process. It’s important – vitally important – that you open two checking accounts. You’ll use one account for buy and hold activities and the other one for rehabbing and wholesaling. Be very careful not to mingle the funds between accounts because there can be terrible tax consequences if you do.

Here’s a quick disclaimer. I’m not a lawyer, an accountant or a financial planner, so don’t look to this as legal or financial advice. If you need that, hire an expert – don’t read an article and expect it to be be the final word on everything.

Once your business is set up you’ll probably feel ready to test the investing waters. If you’re confused about what to do next or how you should get started, you’re not alone. Real estate investing can feel a little overwhelming when you’re first getting started. You’ve probably got a million questions.

While it’s possible to have some success as a real estate investor even if you make some of these mistakes, why would you want to? It doesn’t take much to set yourself apart from the crowd and increase your visibility and your credibility. The fewer mistakes you make the better off you are. Go ahead, correct these mistakes that many investors make and free the entrepreneur that’s struggling to rise to the surface. It’s worth the effort. Go ahead, give it a try!

1. Wholesaling
2. Buy and hold
3. Rehabbing
4. Buying subject too or sub-2
5. Short sales

1. Wholesaling
Wholesaling a property is getting a discounted property under contract and then finding someone to step in your place for a fee. The buyer that steps in your place buys the property from the seller. The fee you receive from that investor or owner occupant (homeowner) is called an assignment fee. The most common way to get your assignment fee is up front; however there are many different ways to collect this fee. The assignment fee can range from $5k to $20k, possibly more depending on how good of a deal you have. You simply assign your original contract to purchase over to the new buyer. If you are dealing with someone you haven’t worked with before they may want the money to be held in escrow by an attorney. The money would then be released after the property closing. The key to wholesaling is getting properties with at least a 60% discount based off of the repairs needed and the ARV (property value after repairs are done).

2. Buy and hold
This is a pretty straightforward strategy and very long term. You buy a property, hold on to it long term and rent it out. It is preferable to rent it for more than your monthly payment. Since most buy and hold investors are looking to purchase properties at a significant discount, they usually purchase properties from wholesalers. Most investors that use the buy and hold strategy are into investing for the long term. When the investor holds the property long term the mortgage gets paid down over the years and the property value appreciates. Thus leading to a big payday when the investor finally decides to sell the property.

3. Rehabbing
Rehabbing may be fun…but it’s not easy. The rehabbing process can be a lot harder and more costly than shows like “Flip This House” and “Property Ladder” can make them out to be. Your rehab can very easily go from making you a profit to costing you A LOT of money if you didn’t get the property cheap enough or budget enough for repairs. To insure you buy right you want to make sure you do your due diligence! Consider buying from a wholesaler, since they know where to get the best deals.

4. Buying subject to or sub-2
Buying sub-2 is a great strategy for buy and hold investors that do not want to put any of there own money down. Buying subject to the mortgage is just that… buying a property while leaving the current mortgage in place. The seller gets their property sold and we get a property with a mortgage in place that doesn’t use our own credit. We do everything through a real estate attorney that specializes in creative real estate. Remember… when you close on a property, subject to the current mortgage, you own it! You have an obligation to pay the mortgage every month, even if your tenants do not pay. Skipping mortgage payments can ruin the sellers credit and result in a foreclosure against them. Savvy investors maybe wondering how they can I buy a property subject to the current mortgage? The best place to start would be with a wholesaler. Wholesalers assign sub-2 properties to other investors all the time.

5. Short sales
Due to the abundant amount of foreclosures on the market, property values have been depreciating. With property values on the decline more and more homeowners are finding out they are upside down on their house. Meaning they owe more on the house than what it’s worth. Lenders are not in the business of owning real estate; they would rather sell a property for a loss than have to take it back via the Sheriff’s auction. These days most lenders are willing to accept a short sale. A short sale is when a lender takes less money for a property than what is owed; thus avoiding a foreclosure. For most lenders to consider a short sale the homeowner must be at least one payment behind. Buying short sale properties is an excellent strategy for buy and hold, rehabbing and wholesaling investors!

If you watched the program, though, you saw that the process can be very stressful. There are always unexpected challenges involved in real estate investing, and this is especially true with homes that need a lot of work. But buying, repairing and selling a fixer upper is just one of the ways people flip a house.

Another strategy is the true “flip” in which you never own the home. The idea here is to make a low offer on a home that needs help and, once the offer is accepted, sell the contract. This involves writing the offer in such a way that you have the right to assign it to somebody else. You also have to be sure that the property has a lot of potential, so you can get paid say $5,000 or more and still leave plenty of profit for the investor who will actually fix and sell the house.

The advantage of this strategy is that you risk almost no money of your own, unless you can’t complete the transaction and you lose your earnest money or “good faith” deposit. Most investors who do this have found ways around even that potential risk. The downside is that like the former plan, this works best when home values are going up rapidly – something we may not see again for a while.

So how do you flip this house now, when times are tough? How do you do it even in the worst of areas, where houses are sitting empty and prices have plummeted? You use a different strategy altogether – one that is especially effective in the poorest neighborhoods.

You may not know this, but there are places where houses are selling for a few thousand dollars. Look around the country and you’ll find these pockets of “real estate poverty.” Try towns in Kansas or Oklahoma, for example. For the sake of this explanation, we’ll look at Detroit, Michigan, where many homes sell for less than a thousand dollars.

You read that right, by the way. As I write this (2009) there are homes listed for as little as $25. In fact, I just checked and found a duplex for $99. There were dozens for a few hundred dollars or less. As you might guess, these are in terrible neighborhoods.

This new strategy starts with cheap houses where people still live and rent. The idea is to buy a home for say $2,000 cash, and then sell it for $12,000 to any renter in the area who has a job. You do nothing to the house at all, selling it strictly “as is.” What you provide for the buyer is cheap financing with almost nothing down.

From the renter’s perspective, this is an opportunity to buy for less than the cost of rent. Prospective buyers may be paying $400 per month for rent on the same block as your house, and you can sell to them for payments of $200 per month. Of course you will have some defaults, even with payments this low. But if you are risking only a few thousand on each home and quadrupling your investment (not counting interest) on those that work, you can afford to do a few foreclosures – and then immediately resell the house the same way.

According to my research, several investors are using this strategy. As long as you have the cash, and you can sell for a great profit and still finance the deal for the buyer with lower-than-rent payments, it is a workable strategy. Even a home that you buy for $30,000 might be sold for $45,000 and still be cheaper than rent for the new owner. A quick clean-up might help, but the fact that you can quickly sell the house as-is (and without risking too much) makes this a more attractive plan than the stressful “flip this house” strategy from the television program.

This statistic is vitally important to investors everywhere because it means that whoever you are and wherever you are investing, you will meet many sellers of homes that are owned free and clear and this is a huge bonus in this mortgage meltdown.

Most free and clear properties are owned by older people. Stop and think for a moment what this means in terms of how you should approach these types of sellers.

What are their biggest desires? What are their biggest fears? How can you help them solve their problems?
Older people want the equity in their homes to fund part or all of their retirement. This means they crave security above all else and they fear making a mistake or getting ripped off.

As an investor, you need to build rapport with an elderly person and allow them to get to know you first without you pushing an offer on them. Spend a lot of time with them and become their friend and don’t expect to do the deal on your first meeting.

I want to be clear that by moving slowly I do not mean taking weeks to work with a seller. Rather, you should be prepared to spend as much time with them as you need to come to a decision with them in a way that feels comfortable for the older seller.

This may take a few hours of sitting and talking. If they offer you coffee or tea when you arrive, take it – and then settle back into your chair to enjoy a leisurely conversation and pay attention to them.
You can gain many valuable insights as the seller shares with you all the stories of his/her life experiences, they are a wealth of knowledge and they are the greatest generation of people to deal with in my opinion.
No matter what your offer to the seller is, you will need to address their need to feel safe with the choice of selling you the property.

Never underestimate the power of positive attention. People sell houses to people they like, and people like people who make them feel good about themselves. Listen to the seller’s stories and encourage them to talk about their past. This is the best way to build rapport with an older owner.
When you understand there concerns, you can specifically address them with the seller. This is a powerful way to close the deal – to deal honestly and up front about their major concerns.

Remember…….you are there to solve their problems, this is the ultimate win win.

There are two main cautions with as-is homes. First, the sellers are not willing to make any repairs to the home. That’s where the name comes from, of course – the buyer is getting the home as it is, with no if’s, and’s, or but’s. Sellers who choose to list their home as an as-is are usually inflexible to the point of being stubborn. They just want to sell the home and get out of it.

This is the reason that so many as-is homes become problematic. In these cases, it is crucial for buyers to have a buyers agent – someone who represents them and only them in buying the house. And, this agent needs to have plenty of experience in order to protect the buyer during the buying process. Why? Because a lot of buyers get taken advantage of in as-is sales. They buy a house from a seller who is not willing to work with them to get the home in proper order before closing. Since price is about the only thing that’s negotiable in as-is sales, it’s possible to estimate the costs for repairs and negotiate this amount off the asking price. However, it’s best to get these problems fixed (as you would do in a typical sale) before you officially own the home.

The second caution with as-is homes is that they usually require a lot of work to be done. This problem is also partly because the seller just wants to get rid of the home and doesn’t want to bother with making repairs or updating parts of the home. After all, making these repairs can be expensive and time consuming. It’s understandable why a seller would simply want to sell and not mess with these potential headaches. There’s a reason that these homes are sometimes synonymous with the term “handyman special” – they need a whole lot of work!

And, even if the home doesn’t need major repairs, it’s practically guaranteed that it will need at least some attention. It’s rare to find a home that doesn’t need any work done to it. Even homes that are practically new need some kind of repair before move in. The best way to protect yourself from this caution is to get a good home inspector. Don’t ever rely on just the seller’s disclosure to learn about the condition of the home. And, this tip applies to as-is homes and regular home sales. Your agent should be able to recommend an experienced and thorough inspector so that you can be sure of the repairs that need to be made before you buy.

So, if you’re considering buying an as-is home, there are two things you should know. First, you should go into the situation expecting that the seller is probably not willing to negotiate on anything other than price (and closing date, of course). The best way to protect yourself in an as-is sale is to have an experienced buyers agent. Second, know that the home will probably need a lot of work done to it. The best way to know what needs to be done is to get a detailed home inspection.

These homes are available for purchase because the owner has defaulted on their mortgage loan, and are in danger of having their property repossessed and sold through an auction by a lender. Unless the homeowner can find a way to come up with the remaining amount of debt owed on their loan, the lender will use the sale as a method of collecting. To keep this from happening, many homeowners seek to sell their homes once they go into default. A foreclosure sale can ruin a homeowner’s credit, as well as their chances of ever getting another home loan, so they will often be very willing to sell their property at a discount to avoid it.

Pre-foreclosures can be very attractive to homebuyers and investors, because the owner will often be willing to undersell their home simply to raise enough money to cover their debt. If you search right in this market you can still find that the amount owed on some of these properties is usually much less than the full value of the home, homebuyers often are able to work out mutually beneficial deals with homeowners that can earn them huge discounts on purchase. Often times, the only trouble is finding these pre foreclosed homes that still have some equity, but that’s where Networkwholesaledeals.com can help, we do all the work for you.

Services provided
Check if the rental agent belongs to any apartment finding services firms. Often, rental agents who are part of any specialist apartment locator services firms are licensed, highly motivated, customer centric, and with good coordination skills. You can receive many other services related to moving to a new place. They facilitate you to find the right and suitable apartment and help to move without a hassle.

Experience
Experience is the key for professionalism. Finding a right and suitable apartment needs experienced and knowledgeable rental agent. It is necessary to enquire about rental agent’s experience in finding apartments, in your specific required locality. A rental agent with adequate experience can guide you correctly in the process of finding a suitable apartment and in moving.

Familiar with Renal Laws
Check if the rental agent is familiar with the rental housing laws. A professional rental agent will provide the required legal information that can help you in singing a flawless agreement with the landlord or at least guide you to a right source so that you can get some legal aid.

Testimonials and Recommendations
Ask rental agents for the testimonials given by their customers. Check for the validity of the testimonials by calling or visiting their customers if possible. Search online for any negative feedback given in websites like forums about the rental agent. Inquire with your friends and family for a rental agent with whom they had a good experience.

Specialist in the Region
It is better to find geo specific rental agent rather than finding agent who deals with a large set of regions. Often, agents who focus on specific region are specialized, provide more information, and help to make the best choice.

Once you find a good rental agent, leave the task of finding a suitable apartment to him and take a back seat. The rental agent can help you out in finding a suitable apartment and in moving into it without any hassle.

The first thing you need to do is start thinking differently. Instead of looking at someone like Donald Trump and saying, “Wow, there is no way I can be as smart as that guy.” Change your mindset to, “What do I need to learn and how will I achieve the levels of success in real estate that I deserve!”

Real estate is a people business and knowledge will help make you more effective in working with people in the context of the business you select. You can start by joining a real estate investment club, known as a REIA with like-minded individuals. Find out what are they investing in? Chances are, it’s in residential properties. And if you speak with other investors, you will realize not all of them were millionaires when they started off.

Owning your own residential property can be a first step to real estate investing, because it allows you to gain appreciation in value over time, which thereby increases your net worth as well. Your ability to leverage that value increases as well via methods such as refinancing and it can provide additional investment capital for you.

Overcoming the mindset of negativity or impossibility in real estate investing is the first step to becoming successful. If you decide you want to build long term wealth and feel real estate is a good place to invest in, then keep at it and do not give up. It’s only a matter of time and effort before you become one of those Herculean figures that everyone is impressed by. Perhaps then, you can educate them on the reality of real estate investing.

Ideally the home we want is where we were born. However the statistics show that most of the times we want to move, believing there, somewhere is waiting our dream house, which, no doubt about it, will suggest us the good or better life.
And that is true… aspirations, gains, ambitions, all is about it – one day to have it – Our Dream!
Either where, because we won’t discus or try to insure you opposing – by the sea or in the mountain – we work only in help – to realize what it is – the real dream of you and to find it – somewhere there – the ideal place, where you will find yourself!