Foreclosure Investing - Understand the Right of Redemption

The rate of foreclosures and the potential profits they offer to investors mean that they are likely to remain a popular real estate strategy for the foreseeable future. But there's an old saying, "the devil is in the details"-meaning that even the largest project depends on the success of its smallest components, a fact that is certainly true when it comes to foreclosure investing. One of those details you need to understand and keep in mind is the right of redemption.

The right of redemption is the right of a property owner to redeem his or her real estate from foreclosure by paying the lender the outstanding principal and interest due, plus the lender's costs in foreclosure, or to redeem foreclosed real property from whoever purchased it at the foreclosure sale. The specifics, such as how long the owner has after the property goes to auction, exactly what has to be paid, and even what the process is called, will vary by state.

There are two key reasons why a foreclosure investor needs to be familiar with the right of redemption. One is that you need to know when you buy a property at auction whether or not the owner can get the property back if he somehow comes up with sufficient funds (typically the outstanding balance, accrued interest, late fees and costs). The second is that you may be able to buy the redemption rights whether or not you actually buy the property.

Foreclosure Investing - Understand the Right of Redemption

Protecting your investment

In states that provide the right of redemption after the foreclosure auction, you want to be sure you're not going to be faced with a situation where you buy the property, spend time and money fixing it up and putting it on the market, then have the owner (or another investor who has purchased the redemption rights) take the property and your potential profits away from you.

The redemption period is set by state law and typically ends at some point before the sale or up to a year after the sale. If the redemption period in your state ends before or at the sale and you buy the property at auction, this shouldn't be an issue. But if the owner has weeks, months, or even up to a year or more after the auction to redeem the property, you have a level of uncertainty that most investors would find unacceptable. Most people who lose a house in foreclosure aren't likely to have the means to redeem it later, but circumstances can change and financial windfalls do happen. Also, because most of the secondary liens are wiped out with the foreclosure, it's possible that the owner could put himself in a better financial position by waiting until after the foreclosure to redeem the property rather than trying to pay those debts and stop the foreclosure.

The solution is, when possible, to buy the redemption rights from the owner, either shortly before or shortly after you purchase the property at auction, at a price you are free to negotiate. Typically redemption rights are sold for amounts ranging from a few hundred to a few thousand dollars. In most cases, an owner facing foreclosure who sees no realistic way to either avoid the foreclosure or recover the property afterward will be happy to sell rights he never expects to use.

Acquire property through redemption rights

Another strategy to consider is to use redemption rights as a way to purchase property after foreclosure. The potential effectiveness of this technique will depend on state law-the redemption period needs to extend beyond the foreclosure sale-but this is how it might work: The redemption price is determined by a statutory formula and may be less than the property's fair market value or the total preforeclosure debt on the property. Let's say the fair market value of the property is 0,000. The property has a first mortgage of 0,000, a second mortgage of ,000, and a mechanic's lien for ,000. The lender in the first mortgage position is foreclosing. At foreclosure, the second mortgage and mechanic's lien may be wiped out. The person holding the right of redemption could exercise that right after the foreclosure sale and pay the redemption price, which would likely be 0,000 plus interest, late fees, and costs. Even if the interest, fees, and costs totaled ,000 to ,000, the purchaser is getting the property for far less than fair market value.

If you're going to use this strategy, it's a good idea to have your financing in place and have any title issues resolved before exercising the redemption right.

To get more information on the laws regarding the right of redemption in your state, start by calling your county courthouse and talking to someone who handles foreclosures.

Foreclosure Investing - Understand the Right of Redemption
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Jacquelyn Lynn (http://www.jacquelynlynn.com) is a business writer based in Orlando, Florida, and the author of more than 20 books, including Entrepreneur's Almanac (Entrepreneur Press Nov. 2007); Online Shopper's Survival Guide and co-author of Make Big Profits on eBay (with Charlene Davis) and In Search of the Five Cent Nickel with Don Abbott. She is also the host and executive producer of Doing It Right Radio® (http://www.doingitrightradio.com).

No Money Down Apartment Investing - Overcoming the Down Payment Hurdle When Buying Apartments

There are numerous considerations involved when buying commercial apartment buildings, but the primary consideration is to find one that is profitable. While this may sound like a no-brainer, too many investors fail to realize the cost of apartment ownership is affected by the rent income not meeting the expenses of the property. Calculating the cost of the down payment, monthly payments for principal and interest and maintenance are only part of the calculation to determine if the property is profitable at the asking price.

Many first-time investors look only at the prospect of simply raising the rent to make up the difference but fail to consider if the current tenants will accept this increase by a new owner. Before heading into the financial marketplace, the investor will need to consider all of the variables in the cost of ownership before seeking financing.

Nearly every commercial lender will require 20 percent involvement by any new owner and most experienced investors will have the liquid assets to take advantage of a good real estate deal.

No Money Down Apartment Investing - Overcoming the Down Payment Hurdle When Buying Apartments

If the prospective investor is planning to buy an apartment building and undertake a major reconstruction project to improve its value, there will be a whole new set of requirements by the bank, along with a lot of extra paperwork before the lender will consider approving the loan. However, consider the bank has approved the loan on the pretext the buyer can come up with the required 20 percent down payment.

No Money Down Apartment Building Buying Strategies Explained

Unfortunately, many new apartment building buyers are unaware of the creative financing possibilities that will allow for the purchase of an apartment complex with no money down. It is possible to take ownership of many rental apartments without having the entire 20 percent coming from the new buyer.

There are some options available when it comes to raising the capital needed to make this type investment, but remember the 20 percent down will be based on the purchase price and not what the property is worth or what the new buyer claims it to be worth.

Some of the options include borrowing money from friends and family to come up with the required cash, seek the help of the current owner to back the needed money for the down payment or form a limited partnership, offering shares in the rental property to those willing to invest in the purchase.

The first two options are somewhat self-explanatory, as borrowing from friends, family to the current owner will usually involve specific monthly payments, akin to taking out a second mortgage to pay the down payment, while a limited partnership can raise the money without giving up total control of the unit.

Using a Limited Partnership to Buy Apartment Buildings with No Money Out of Your Pocket

It is recommended that any partnership agreement be forged by an experienced real estate attorney to insure the investors are protected and that the agreement meets all state and federal laws surrounding such agreements. One general partner, who will have some executive powers over the state of the property and any decisions pertaining to its operation, will need to be in place. Other limited partnerships can be sold to other investors and, based on the percentage of their investment, can receive a return on their investment either on a monthly basis, paid from the cash flow of the building, or held until the property is sold at a later date, repaid an amount based on the profit of the

No Money Down Apartment Investing - Overcoming the Down Payment Hurdle When Buying Apartments
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If you are looking to expand your investment portfolio and you would like to learn more about the many benefits of an apartment building investment then I suggest that you read my free mini course on apartment building investments that can be found at Apartment Building Investor

If you are really serious about learning exactly how to find, buy and manage very profitable apartment buildings then you must enroll as a student in my Buy Your First Apartment Building E-Course

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Just Because A Man-Woman Says They Need Space Doesn't Always Mean The Relationship Is Over

One day you meet this really fantastic person. There is strong chemistry there and so you think this is it. You immediately put yourself out there and instantly go "overboard" doing too many things to show the object of your interest and attention that you are very much in love. And when you thought it couldn't get any better, he/she says those dreaded words, "I need some space." You lose control of your thoughts and emotionally collapse and lash out. This eventually leads to an ending that is deeply disappointing.

Many men and women miss out on relationships with great potential simply because they assume "I need some space" always means the relationship is over.

"I need some space" is especially very confusing for men and women who grew up in an environment which was unstable. They easily get bothered by sudden changes and the "not knowing" what's going to happen next overwhelms, frustrates and depresses them.

Just Because A Man-Woman Says They Need Space Doesn't Always Mean The Relationship Is Over

The real tragedy here is that when you overwhelm a man or woman with your desperation, neediness and anger, you force him/her to actually think about ending the relationship. Your strong drive and determination to get attention and love is likely to get you into difficult situations because you want things going faster -- your pace, your call. What you get is men and women literally running for their lives, "It's best if we had no contact", or "Just leave me alone," or "You are too much for me".

This is why it's crucial that you understand that "I need some space" doesn't always mean I am no longer attracted to you or the relationship is over. Sometimes when a person says "I need some space" all they are saying to you is that, at this time, the value of what you are offering does not justify me taking a risk or investing more than I already have. Many men and women hesitate because they fear that they might be making the wrong decision and will regret it later.

If he/she asks for his/her "own space" don't automatically assume this is a pre-breakup situation.

1. Give him/her the "space" he he/she needs. This is his/her opportunity to come face to face with his/her feelings for you, don't get in his/her way. This may even be a chance for both of you to reassess what you have and work on what you might have in the future.

2. Ask him/her what possible compromises he/she is willing to make (may be meet once a week, weekends only, every other week? etc.) then give him/her the space he/she needs. If he/she refuses to compromise, then you know for certain that they're looking for ways to end the relationship. A person's body language will tell you more about their particular state of mind.

3. If he/she is willing to make some compromises don't force him or her to pay more attention to you than he/she is willing to. Repeated attempts to get back a man or woman who is "scared" for his/her life is completely useless. Only a significant space of time and a new type of approach will have any effect on someone whose guard is already up and whose sensitivity is razor-sharp.

4. It is important that you understand that giving him/her space does not mean you don't have anything to do with him/her. On the contrary, maintain your contact with him/her, but make the "contact moments" work to your advantage.

The most effective way to do this is employ a little playful resistance or what we commonly know as playing hard-to-get. Keep in mind that not all playing hard-to-get rules and actions are designed to make someone fall in love with you. Many of the popularly promoted playing hard-to-get "techniques" out there actually drive someone away instead of make them want you more.

The best kind of playing hard-to-get is one that creates more love than resistance. Using a little bit of playful resistance, you can create a "FRIENDLY SPACE" for fair negotiation, easily eliminate a man or woman's reservations about the relationship and concerns about making a long-term commitment and motivate him/her to take the action of risk and to want to invest more in you and the relationship.

When you understand this very engaging and bonding game, you can turn the "I need some space" into a "Let's try it again" or even "This is what I want!" Simply saying it to them is not enough, they need to SEE by your actions that you really understand what they want in a relationship.

Just Because A Man-Woman Says They Need Space Doesn't Always Mean The Relationship Is Over
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Christine Akiteng is an internationally renowned Sexual Confidence/Dating Coach and author of e-Books: The Art Of Seducing Out Of Fullness, Breaking A Bad Relationships Pattern, and Playing Hard-To-Get The Love Way.

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