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Preface | |
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Acknowledgments | |
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Introduction | |
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Introduction to the Second Edition | |
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Five Magic Paths to Making a Fortune in Real Estate | |
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The Five Magic Ways to Wealth | |
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Now It's Time to Make Real Money | |
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Guidelines for Getting Started | |
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Combine Techniques to Ensure Success | |
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Before You Roll Up Your Sleeves | |
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Take Some Measurements of Your Market | |
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Magic Paths FAQs | |
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Making Money with Fixer-Uppers | |
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The Fix-Up-and-Sell Strategy | |
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Buying a Fixer-Upper | |
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Seek Fixer-Uppers in All Price Levels | |
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You May Wish to Live in Your Investment | |
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Eight-Point Checklist for Making Money with Fixer-Uppers | |
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Some Bargaining Ideas | |
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Rehabbing: Frequently Asked Questions | |
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Finding the Fixer-Upper Bargain | |
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Mining for Gold: Target a Neighborhood | |
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Find Sellers with Neglected Properties | |
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Screen the Seller's Motivation--Using the Telephone to Advantage | |
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Ways to Find Sellers | |
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Don't Overlook Out-of-State Owners | |
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You're Ready to Meet the Seller at the Property | |
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Seek Houses through MLS or the Internet | |
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Get Agents to Bird Dog Property for You | |
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Have a Contact System for Agents and Prospects | |
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When You're Offered a Group of Houses | |
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It's All about Prospecting | |
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Finding Foreclosed, Repossessed, or Condemned Property | |
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The Perils and Rewards of Buying at Foreclosure | |
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Finding Properties before Actual Foreclosure | |
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Step In and Negotiate before the Foreclosure | |
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Solving the Problems of a Homeowner Facing Foreclosure | |
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Taking Over a Qualifying Foreclosure | |
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Getting Started with Your First Auction Foreclosure | |
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Deciding Whether a Deal Is Good | |
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Some Reminders on Foreclosures | |
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When the IRS Has a Lien on Property Being Foreclosed | |
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Get Acquainted with Auction Procedure | |
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Getting an REO from the Bank | |
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Use Your Repair Estimate to Drive the Price Down | |
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Find Condemned Houses in Respectable Neighborhoods | |
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Repairs That Make You the Most Money | |
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Start by Getting Accurate Estimates | |
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Four Broad Areas of Repairs | |
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Six Major Areas of Inspection and Repair | |
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From Preliminary Outline to Finalized List | |
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A First Priority: Arranging Time for the Repair Estimation | |
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Early Inspections Avoid Problems Later | |
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Typical Repairs You May Encounter | |
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What Repairs to Avoid | |
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Always Solve Code Violations | |
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Getting to Know the Bricks and Mortar, or, The More You Know, the More You'll Earn | |
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Special Problem of Dealing with a Cracked Foundation | |
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Another Common Rehab Problem: Fire Damage | |
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Six-Point Checklist for Fixing Up | |
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Valuing Properties Is the Key to Profits | |
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Judging the "After Repairs" Value | |
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Repair Costs Lead to Finding Value | |
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Getting Started in Valuing Houses | |
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You Start by Finding Comparable Properties with Recent Sales | |
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Doing a Mini-Appraisal | |
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What to Consider in Determining Value | |
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Making Adjustments to Equalize Value | |
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Features to Adjust in the Mini-Appraisal | |
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Pricing Adjustments Accurately Improves with Experience | |
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Make Sure Comparable Sales Are Arm's-Length Transactions | |
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Neighborhood Prices Tend to Cluster | |
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Negotiate to Get Your Offers Accepted | |
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How Much Profit Do You Take? | |
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How to Determine Maximum Offer Price | |
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Now That You Know Your Limit, Where Do You Start? | |
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Use Repair Costs to Convince the Seller | |
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Be Ready to Walk Away If No Solution | |
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Make Offers on a Regular Basis | |
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Seven-Point Strategy to Get Your Offers Approved | |
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Always Use "Contingent on Financing" Clause | |
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Wholesale Property for Steady Gains | |
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What Are the Basics of Wholesaling, or Flipping, a Property? | |
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Getting Started with Wholesaling | |
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Advice for a Newbie! | |
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Searching for a Property to Flip | |
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To Whom Do You Wholesale? | |
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Run an Ad to Attract Investor-Buyers | |
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Make Sure Your Wholesale Buyers Have Cash or Credit Line | |
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Finding Cash Buyers for Wholesale Property | |
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It's All about Establishing Relationships | |
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Why a 3% to 8% Profit in Wholesaling Fixer-Uppers? | |
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Contract Provisions for Wholesaling | |
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Using Two Contracts to Separate Seller and Buyer | |
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Problems and Solutions in Wholesaling | |
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Financing I: Working through Conventional Lenders | |
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The Differences between Home and Investment Mortgages | |
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Down Payment and Closing Costs | |
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Shop for Mortgage Loans | |
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What Types of Mortgages Are Available? | |
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Comparing Different Mortgages | |
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Two Ways to Qualify for Fixed Rate Loans | |
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Second Mortgage Financing from a Conventional Lender | |
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Cash from a Home Equity Credit Line | |
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Be Prudent in Risking the Equity in Your Home | |
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Using a Blanket Mortgage to Cover the Down Payment | |
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Consider a Construction Loan to Finance Repairs | |
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Credit with a Commercial Bank Is Better than Gold | |
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Rehabbing through the FHA 203(k) Loan | |
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Fannie Mae HomeStyle Loan | |
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Financing II: Help from the Seller | |
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Secondary Financing from the Seller | |
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Seller Financing with Second Mortgage | |
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When Seller Financing Is All That's Available | |
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What "No Money Down" Really Means | |
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Buying "Subject to" and "Assuming" an Existing Mortgage | |
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Problems of Buying "Subject to" | |
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Takeover with Management Agreement and Escrowed Deed | |
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Using a Land Trust | |
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Using Credit Cards to Help with Down Payment | |
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Word of Warning | |
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Title I Loan Guarantee | |
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Questions and Answers on Financing | |
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A Final Note | |
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Lease/Options I: Arranging Rent-to-Own with Tenant-Buyers | |
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Be a Matchmaker | |
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Owner's Reasons to Participate in Lease/Option Are Varied | |
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Make the Lease/Option Appeal to the Seller | |
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Making a Lease/Option Offer | |
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Doing the Typical Lease/Option Deal | |
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Your First Lease/Option Deal | |
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Making Sure You've Got a Great Deal | |
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Five Ways to Find Tenant-Buyers | |
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Use a Lease/Option to Take a House with Little Equity | |
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A Final Note: Keep a Working Relationship with Your Agent | |
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Lease/Options II: Arranging Contracts and Closings with Tenant-Buyers | |
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Structuring a Safe Lease/Option | |
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Advanced Techniques--Use Lease/Purchase/Option to Sell Fixer-Uppers for Best Price | |
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What Is the Difference between an Option and an Agreement to Purchase? | |
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What Should Be in Lease/Option and Lease/Purchase Agreements | |
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Keep Your Right to Assign Contract with Owner | |
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Whom Do You Make Responsible for Repairs? | |
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When Your Tenant-Buyer Wants to Change the Terms | |
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Making Sure the Lender Accepts Rent Credits | |
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Does a Lease/Option Trigger a Due-on-Sale Clause in the Mortgage? | |
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Working Out a Simultaneous Closing | |
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With Sellers You've Got More than One Arrow in Your Quiver | |
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Buy-and-Hold I: The Single-Family | |
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Buy and Sell, or Buy and Hold | |
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The Buy-and-Hold Strategy | |
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Buying and Renting Out the Single-Family | |
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Using Quick Ratios to Value the Single-Family Rental | |
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The Five Tools That Lead to Wealth | |
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A Capital Gains Tax Review | |
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Maintaining Investor Status with the IRS | |
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Exchange of Property to Preserve Long-Term Gains | |
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One Indispensable Tool--The Financial Calculator | |
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The Time Value of Money | |
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Accumulated Interest and Loan Balance after a Specified Payment | |
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Buying a Rental House | |
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The Present Value of an Investment | |
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Buy-and-Hold II: The Multifamily | |
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Why the Multifamily Is a Great Long-Term Investment | |
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Target Properties That Throw Off Cash | |
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Create an Accurate Income and Expense Statement | |
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Start by Researching Rents, Vacancy Rate, and Expenses | |
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Net Operating Income Is Basis for Establishing Value | |
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Working with the Capitalization Rate | |
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Cap Rate Is a Function of Building's Age and Condition | |
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Finding the Value of an Income Property | |
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A First Deal: Using Cap Rate to Peg Value | |
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You Really Want to Know How Much Cash Is Left Over | |
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Valuing Future Income--Discounted Cash Flow Analysis | |
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Discounting Cash Flow after Financing | |
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Internal Rate of Return | |
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Depreciation and Interest Deductions Determine Your Taxable Income | |
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Your Cash Flow after Taxes | |
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Making the Offer on the Multifamily | |
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Beware of Gross Rent Multiplier | |
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Using the Capitalization Rate to Know What to Offer | |
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Again, Once You Decide to Buy, Make Two Offers | |
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Deciding to Buy or Not to Buy | |
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If It's Not Worth Selling, It's Not Worth Buying | |
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Raising Rents Leads to More Value | |
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Working with Agents on Multiunit Deals | |
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Financing the Multifamily | |
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Cash and Skills Help Gain a Conventional Loan | |
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Knowing the Lender's Guideline--The Debt Coverage Ratio | |
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Getting the Seller to Finance | |
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After a Conventional Lender Takes the First Mortgage | |
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Tax Law Promotes Seller Financing with an Installment Sale | |
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Using a Land Contract to Bypass the Bank | |
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Take Over a Large Mortgage | |
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How Long Do You Want Your Mortgage to Run? | |
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Accelerated Mortgage Payments in Perspective | |
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Some Financing Guidelines | |
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More Creative Techniques to Make a Deal Work | |
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The Roth IRA | |
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When Taking In a Partner Can Make More Profit | |
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Managing Your Property | |
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First Time Out: Be Your Own Landlord | |
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What a Property Manager Does | |
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Getting Good Tenants | |
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A Landlord's Primer | |
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When All Else Fails: Removing Late-Paying Tenants | |
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On Looking for a Good Property Management Company | |
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Your Liability as a Landlord | |
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Limit Your Loan Liability to the Property | |
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Should You Form a Corporation or Limited Partnership? | |
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The Magic Formula for Success: Use Flexible Strategies | |
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Be Flexible--Profit with Different Strategies | |
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Choose the Best Technique to Create Wealth | |
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Before the Finish--Use an Attorney | |
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Plan Ahead to Reduce the Risks of Real Estate | |
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Knowledge Gives You Confidence | |
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Let People Know You Deal in Property | |
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Work Hard to Become Known | |
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How You Benefit from the New Tax Law | |
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Recent Tax Laws Keep Dollars in Your Pocket | |
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Sheltering Taxable Gains from Your Home | |
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Using the Gain Exclusion with Multiple Residences | |
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Tax Rules for Second-Home Ownership | |
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Should You Turn Your Own Home into an Investment Property or Sell It? | |
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Are You a Dealer or an Investor? | |
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The Tax-Deferred "Starker" Exchange | |
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Combining the "Exchange" with the "Exclusion" | |
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A Final Note | |
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Epilogue: Success Is Not about Education, or Even Hard Work--It's about Following Through | |
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Tips to Remember | |
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Final Thoughts | |
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Index | |