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5 Magic Paths to Making a Fortune in Real Estate

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ISBN-10: 0471548251

ISBN-13: 9780471548256

Edition: 2nd 2004 (Revised)

Authors: James E. A. Lumley

List price: $34.00
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Description:

James Lumley offers five simple but proven techniques that successful real estate investors use every day to make money. Wannabe investors will learn about fixer-uppers, small to medium sized apartment buildings, & lease-purchase agreements among other techniques.
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Book details

List price: $34.00
Edition: 2nd
Copyright year: 2004
Publisher: John Wiley & Sons, Incorporated
Publication date: 5/21/2004
Binding: Paperback
Pages: 336
Size: 6.00" wide x 9.11" long x 0.87" tall
Weight: 0.902
Language: English

George Ames Plimpton was born March 18, 1927. He was educated first at Phillips Exeter Academy in New Hampshire, and then spent four years at Harvard majoring in English and editing the Harvard Lampoon, followed by two at King's College, Cambridge. Before he left for Cambridge, he served as a tank driver in Italy for the U.S. Army from 1945 through 1948. After graduation, at about 27 years of age, Plimpton went with his friends to Paris. There they founded the Paris Review in 1953 and published poetry and short story writers and did interviews. In the '50s, Plimpton and staff came to New York, where they kept the Review going for half a century. The Review has published over 150 issues.…    

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