Unlocking your home equity

(Fortune Magazine) -- The housing rescue package that Congress scrambled to pass in July was aimed primarily at stemming foreclosures and shoring up Fannie Mae and Freddie Mac. But it also contains provisions that make reverse mortgages a better deal for older homeowners who want to turn their equity into cash.

Lawmakers are paying attention to reverse mortgages because these once-marginal products have exploded over the past decade, thanks to low interest rates and rising home values. The federal government, which backs more than 90% of all such loans through the Home Equity Conversion Mortgage (HECM) program, guaranteed 107,400 reverse mortgages last year, up from 7,900 in 1998. What's more, an industry group estimates that even after the drop in housing prices, seniors' equity in their homes was worth $4.2 trillion at the end of 2007. With slimmer savings and pensions than their parents had, more boomers will probably be turning to reverse mortgages when they retire. But these products are much more complicated than your garden-variety loan, so before you rush to download an application, you have to do some homework.
Here are the basics

Reverse mortgages are like home-equity loans, with a few key differences. First, they're available only to people age 62 and older. The amount you can borrow depends on your age, the value of your home, and interest rates (check out AARP's calculator at rmaarp.com for an estimate). You can choose to receive your money in a lump sum, monthly installments, or a line of credit. There are no monthly payments to make - and therefore you don't have to meet an income requirement to qualify.

In fact, you needn't repay the loan until you move out of your house, sell it, or die: The debt is settled with the proceeds from the sale of your home. If there's money left over, it goes to you or your heirs. But what if your house sells for less than what you owe? (That's not an idle question in a time of plunging home prices.) Don't worry. The federal government covers any shortfall for HECM loans, and for others the mortgage holder simply eats the loss.

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REO Properties- Some of Real Estate’s Finest Gems for Investors

When real estate investors evaluate their options for what types of properties to invest in, some of the first things that come to mind are preforeclosure, short sales, and other types of foreclosure properties. This tendency is a natural one. After all, sellers facing foreclosures are naturally going to be more motivated and that is what most investors are looking for.

Where do most investors turn to when they seek preforeclosure opportunities? Sure, they take a look at free foreclosure listings or even sources of foreclosure listings that they pay for. While these sources may lead to productive and profitable deals, they also require extensive marketing and business promotion in order for an investor to tap into these preforeclosure opportunities.

To Get a Free Foreclosure and short sale Course including how to buy REO Properties, Go here Reo Properties

What other options do investors have? Well, in today’s market, more and more realtors are marketing properties as short sales in the MLS. While these do represent preforeclosure opportunities, I also think that this can be risky for the investor because many real estate agents are pretty new to the foreclosure world (and thus may just be learning what is a short sale) and you are taking a chance that the agent in charge of the deal actually knows what they are doing. Plus, you still have the emotional aspect of the sale, a natural by-product of foreclosures that can complicate deals in some cases.

A significant but often overlooked option available to investors concerns bank foreclosures. This umbrella term includes REO properties and HUD homes but it all ties in with the REO process, the phase of foreclosure that follows the auction and where a lender must then sell the foreclosures in their inventory.

Many investors shy away from REO properties or HUD homes because they feel they have less negotiating power or simply lack the capital to make aggressive offers and play along with the rules that REO lenders stipulate. While I favor preforeclosure and short sales myself, I also have a system in place that allows the machine to run on autopilot, a system that I can also teach you.

My efforts here are to assure you that there are indeed deals to be found within the realm of REO properties. The offer process in many ways is less complicated, there is little to no emotion on the part of the seller (the REO lender), and deals can be completed much more quickly. If that appeals to you, and capital is your primary limitation, then you owe it to yourself to check out my Preforeclosure Cash Flow System and the module within it that covers how to obtain unlimited amounts of capital for your foreclosure business.

In closing, the entirety of the foreclosure process is ripe with deals that are there for the picking. As rigid as REO properties or HUD homes may seem, the REO process is as much as part of foreclosures as the preforeclosure side of the business. Don’t limit your scope, learn from what I have to offer you, and I wish you the very best in success in real estate investing.

To Get a Free Foreclosure and short sale Course including how to buy REO Properties, Go here REO Properties

Dedicated to Multiplying Your Income,

D.C. Fawcett

The Business Building Coach to the Foreclosure Industry

www.realestateforeclosuresinvesting.com

Loss Mitigation Training- An Essential Part of Any Preforeclosure Business

When real estate investors envision what it means to invest in foreclosures, they usually fall into one of two camps. One camp contains investors who primarily focus on the REO process, and they typically purchase REO properties or HUD homes to build their portfolios or generate profits. The REO camp usually requires access to a little more capital to be consistently active so this may offer limitations to many investors, particularly those new to real estate.

The other camp, and the one that I have built my own real estate business around, focuses on preforeclosure properties and short sales. There is also fantastic money to be made here (if there wasn’t, I wouldn’t personally be doing it) and it offers more opportunities for the novice investor. It is primarily for this camp that I have created my landmark Preforeclosure Cash Flow System.

To get a free Foreclosure investing and short sale course,

Go to: Loss Mitigation Training

Working the preforeclosure side of the foreclosure business is a natural draw for many investors interested in foreclosures because there is an abundant source of motivated sellers. That is only the tip of the iceberg, though. No matter how motivated a seller may be, real estate investors need to be well trained to be at their best. At the core of this need for training lies loss mitigation training.

What is loss mitigation? It is a general term that refers to working with a lender, whether you are helping a seller negotiate a payment arrangement or if you are working short sales. Lenders have their procedures they follow when processing foreclosures and so too should you have a process for working with loss mitigation.

Today’s preforeclosure business is more than just looking for free foreclosure listings on the Internet or taking the plunge and investing in foreclosure listings that carry a monthly or annual fee. Anybody can do this and what will set you apart as a foreclosure real estate investor and as a preforeclosure specialist is the type of loss mitigation training you have.

I’ve been in this business of foreclosures for a long time now and I’ve seen a lot of experts come and go whose best approach was simply to tell you about all the money there was to be had in preforeclosure and short sales. Where these others fell short was their inability to effectively train their clients in loss mitigation.

My business approach is a little different. Sure, I’m going to be honest with you and tell you that there is indeed a lot of money to be made in short sales and most any aspect of the preforeclosure business. I also back that up by providing the type of loss mitigation training that I have proven successful with my own business.

Friends, loss mitigation and short sales are incredible opportunities but it can also be a jungle out there if you lack the loss mitigation training you need to be at the top of your game. You owe it to yourself to check out my Preforeclosure Cash Flow System and the detailed, cutting edge approach to loss mitigation that is contained within it. I wish you the greatest success in real estate investing.

To get a free Foreclosure investing and short sale course,

Go to: Loss Mitigation Training

Dedicated to Multiplying Your Income,

D.C. Fawcett

The Business Building Coach to the Foreclosure Industry

www.realestateforeclosuresinvesting.com