Demystifying Real Estate Investing

Overcoming the misconceptions that keep you from investing in real estate

Most people who aren’t investing in real estate are being stopped by doubt and fear. They may want to invest in real estate, but each time they consider taking action, they come up with an obstacle or a core belief that keeps them from moving toward their dreams.
According to The Millionaire Real Estate Investor by self-made millionaire and real estate investor Gary Keller, most successful real estate investors have had to overcome certain beliefs that later proved to be unfounded. Some of these beliefs center around the way they view themselves as investors, and the others are focused on beliefs about investing. By addressing these doubts and fears, and recognizing that they’re unfounded, you’ll eliminate the major barriers to becoming a real estate investor.
Personal Myth #1: "I don’t need to be an investor. My job will take care of my personal wealth."
Truth: History indicates that few jobs pay enough to create true financial independence. Financial wealth building depends on another vehicle.
Personal Myth #2: "I don’t need or want to be financially wealthy. I’m happy with what I have."
Truth: Financial wealth offers greater opportunity to care for yourself and others, and that is something most everyone wants and needs.
Personal Myth #3: "I can’t do it."
Truth: You don’t know what you can or cannot do until you actually try.
Investing Myth #1: "Investing is complicated."
Truth: Investing is as complicated as you make it.
Investing Myth #2: "All the best investments require knowledge most people don’t have."
Truth: Your best investments will always be in areas that you can or already do understand.
Investing Myth #3: "Investing is risky. I’ll lose my money."
Truth: Investing and gambling are not the same thing. Investing, by definition, is not risky.
Investing Myth #4: "Successful investors can time the market."
Truth: Timing isn’t about being in the right place in the right time. It’s about being in the right place all of the time.
Investing Myth #5: "All the good investments are taken."
Truth: Plain and simple, every market, in every time, has its share of good investments.
There’s nothing more powerful for keeping you out of action than fear and doubt. By seeking the truth, rather than relying on unfounded beliefs that lead to fear and doubt, you can overcome your greatest obstacle and get closer to achieving your dreams.
If you’re interested in investing, but you have doubts about whether or not investing fits in with your current financial program, it’s best to consult with a qualified and reputable Mortgage Planner who can assess your financial situation and put you on a plan that targets your goals. As with any financial program, gaining clarity on the facts is always the best place to start.

Eight Quick Credit Improvement Tips

As the mortgage industry continues to evolve, one thing for sure is that your credit history will be one of the most critical factors in obtaining home loans. Here're are 8 quick tips on how to improve and maintain a good credit history:

1. If possible, get a business credit card - most people don't realize that over 90% of business credit cards do not get reported to personal credit reports. If they are not reported, they are not scored, period.
2. Settle for deletion, or at least zero out all unpaid collection accounts less than 24 months old - when payment is made on a collection account that is less than 24 months old, the score will either stay about the same or increase a few points. Settling in exchange for deletion is ideal, but not always possible. Given the fact that the collection account will keep selling to other collection agencies in the future, it is best to deal with it while it is still young.
3. gets rid of all past due amounts on non-collection/charge-off accounts and make sure to pay before the due date until after the loan closes to be safe - credit scoring software penalizes for keeping accounts past due, so past dues destroy a credit score.
4. Get rid of your late payments - contact all creditors that report late payments on their credit and request a good faith adjustment that removes the late payments reported on their account.
5. Ask for a credit limit increase on your credit cards and either pay-off if possible or at a minimum evenly distribute the balances you are carrying on the revolving debt - credit scoring software likes to see borrowers carry credit card balances as close to zero as possible and also see that they have been trusted with a lot of credit - which is why increasing their limits is good.
6. Do not close your credit cards - closing a credit card can hurt your credit score, since doing so affects your debt to available credit ratio.
7. Keep old credit cards active - 15% of a credit score is determined by the age of the credit file. Fair Isaac's credit scoring software assumes people who have had credit for a longer time are at less risk of defaulting on payments. Therefore, even if old credit cards have horrible interest rates, closing those cards will decrease the average length of time a client has had credit.
8. Pay down Negative Amortization mortgage balances below the original amount borrowed to increase the score - most people don't realize that owing more than the original amount borrowed on a loan is a negative event to the credit score.

If you need more specific information on any of these tips, feel free to contact me.