Real Estate Newbies - A Simple Way to Start Real Estate Investing Without Money Down

The popular notion that it is imperative to invest a great deal of money in order to make profits in real estate business is simply not true. The same goes for a credit or financing facility. There are many ways which can be applied for making real money in real estate business without investing your own money. The idea that I am going to put into words below is not an on-time quick-rich formula. It's a genuine real estate activity. One, which can be adapted as a career. The idea is called bird-dogging.

Bird-Dogging defined

Bird-dogging simply means locating and selling a property to a potential customer. The bird-dog finds a suitable property, locates its owner and convinces him to sell. If the owner agrees to sell, the bird-dog finds an investor who is ready to buy that particular property. The investor buys the property and pays a certain amount to the bird-dog for the services rendered by him. The bird-dog does not need to invest a single penny of his own in the whole transaction. Yet he gets away with a hefty sum.

How to become a bird-dog

The first step in this regard is to find an investor who enjoys good reputation and with whom you will feel comfortable. You can also seek a company that specializes in buying and selling properties.
Ask the investor or the company to register you with them. They will usually assign you a certain area to work in. It is your job to look out for suitable properties in that area and make contact with the owner, and then inform the company or the investor about that property.

What do you need to become a successful bird dog?

There are many attributes that are necessary for you to become a successful bird-dog. Fortunately, you don't have to be born with them. A little time and effort is needed to cultivate such properties. Some of them are noted below.

A knack for properties

You must train yourself to be on the constant look-out for available properties. You must keep your eyes open all the time even when you are driving in the neighborhood or going to the gym.

Moving in the right circle

If you want to be a bird-dog, you must move in the right circle. Your acquaintances must belong to the real estate community so that whenever a particular piece of property or an opportunity arrives; you are first one to hear about it.

Impeccable interpersonal skills

This is the key to success. The bird-dog is like a double agent. He has to convince the owner that the deal he is offering is good enough for him. At the same time he must convince his investor or principal that the deal is good for them too. The activity needs a cutting edge sharpness of mind and impeccable negotiating skills. Fortunately, this is something that you can achieve after spending some time in the field.

I invite you to learn more about Real Estate Investing and become a member of our FREE weekly tele-seminar class where we teach tips and strategy on how to grow your real estate investing business and how to raise Private Money by going to http://www.realestatewealthtoday.com/TuesdayTipsSignUp.html.

Mike Lautensack is a full-time real estate entrepreneur, coach and mentor in Philadelphia, PA and creator of the Private Lending Presentation Kit. This powerful done-for-you kit is loaded with tools and techniques to attract and develop a consistent stream of private investors into your real estate business. To learn more about this kit and receive your FREE eBook go to Real Estate Investing Blog

The Pros and Cons of Renting to Section 8 Tenants?

You may be a brand new investor or a seasoned investor looking for new ways of increasing your income. Some of the real estate guru’s have made big money selling real estate investing courses touting the benefits of government programs, specifically Section 8 housing, and how you can make money hand over fist. Others take a more cautionary approach, essentially arguing just the opposite.

With two opposing views, who’s right, who’s wrong, and what’s the difference?
There are a couple of Pros to Section 8 investing. But as you will quickly see the list of Pros is much shorter than the list of Cons.

First, if you rent to Section 8 tenants, you know you’re going to get your rent money. As a general rule, it’s going to come in like clock work. You’ll have your money each and every month, conveniently deposited into the bank account of your choice.

Second, if you advertise the fact that you accept Section 8 tenants, you will have no shortage of prospective tenants lining up with a housing voucher ready to move in on a moment’s notice. When tenants are hard to come by, say in a strong housing market, it’s an excellent way of guaranteeing a steady flow of renters willing to be your tenants.

Unfortunately, this is where the list of positives ends.

Section 8 tenants can present a host of challenges and problems to you from a variety of angles.

First, as a property owner, you may be lured by the easy money that renting to Section 8 tenants can generate, but if you think the Paperwork Reduction Act applies to Section 8, you have a lot to learn.
Whenever you deal with any government bureaucracy, there are massive paperwork considerations. If every I isn’t dotted and every T crossed on every form the government throws your way, you’re in jeopardy of not being paid, having your payment delayed or even worse being declared a slumlord.

We have also seen when all the paperwork and other delays can take anywhere from 3 to 5 months to complete. During this period your property sits empty with no income.

Second, Section 8 requires property inspections. In order to participate in Section 8 you first have to qualify as a property owner, which means an inspection. If the inspector finds deficiencies of any kind, they have to be corrected on the government’s timetable. Once you’ve met the timetable, you have to repeat the inspection process. When you’ve waded through all the red tape necessary to accept tenants, you really get into the heart of the problem of the Section 8 program dealing with tenants.

Third, there are Section 8 tenants who are attentive to your rules, but there are plenty of bad apples. If you have a troublesome renter one that can’t/won’t pay their rent on time or is a constant troublemaker, your inclination is to give them their walking papers (i.e., eviction). But if the individual you’re trying to evict is a Section 8 renter, you have to follow due process rules that are stricter than any state laws anywhere.

Once you’ve begun eviction proceedings, Section 8 tenants are entitled to free or very low cost legal assistance. Once an attorney enters the picture, this turns into an expensive, time consuming process. You need to ask yourself at what point does a guaranteed rent payment become not worth the hassle, the expense and the headache?

Fourth, we generally see that Section 8 pays about 70% to 80% per month of what you might get for normal tenant. So you need to make decision as to whether this discount is offset by the consistent payment source.

Fifth, Section 8 renters aren’t famous for taking care of your property. So unless you’re willing to entertain the thought of having to make extensive repairs with little hope of recovering damages it is probably in your best interest to not involve yourself in the program to begin with.

As you can see the Cons of Section 8 investing outweigh the Pros. Our experience is the program has many problems and we rarely recommend Section 8 investing.

I invite you to learn more about Real Estate Investing and become a member of our FREE weekly tele-seminar class where we teach tips and strategy on how to grow your real estate investing business and how to raise Private Money by going to http://www.realestatewealthtoday.com/TuesdayTipsSignUp.html.

Mike Lautensack is a full-time real estate entrepreneur, coach and mentor in Philadelphia, PA and creator of the Private Lending Presentation Kit. This powerful done-for-you kit is loaded with tools and techniques to attract and develop a consistent stream of private investors into your real estate business. To learn more about this kit and receive your FREE eBook go to Real Estate Investing Blog