How To Make The Real Estate Recession Work For You
Astonishing enough ,this real estate recession is getting so down that many Americans are paying more on their mortgages than their homes are even worth! Clearly, this is the worst state our economy has been in since the Great Depression.
Developers in many areas have gone bankrupt, even large developers that appeared solid and structured. There are hundreds of different sub developments scattered all over the United States that have been left unfinished. There are thousands of new construction homes that are either in the process of construction or have never been occupied.
In addition to that, there are more existing homes on the market than there are buyers. Many of these homes have gone into foreclosure because the owners lost their job in this blighted economy. Things truly look bleak.
In order to try to resist the nation from falling directly into a recession, which it already has although many politicians are denying it, the Federal Reserve has systematically lessen the interest rate for home mortgages. Home mortgage lenders are so desperate to make loans that they are calling people that they made loans to years ago in an attempt to try to get them to refinance. There was a time when people who wanted to refinance their homes could not get through to a lender.
What does all this mean to you? It should mean opportunity. The interest rates are low and so are the housing prices. That means this may be the best time to buy and buy cheap.
Everyone needs a place in which to live. You can take advantage of the low mortgage interest rates as well as the abundant foreclosures on the market and buy a home to rent to a tenant. The tenant will pay you rent in the amount that covers the mortgage, insurance and any property taxes. If possible, you can make a few extra dollars on the side. This can be put towards repair of the house in case the tenant ruins the carpeting or walls.
You should ask for a security deposit and credit check from the tenant. This way, you will have some security that the tenant is of good character and will most likely pay their rent on time. You should have a bit of an understanding about lease laws in your state in case the tenant does not pay their rent so that you know the eviction process.
Renting to tenants can be a profitable way for someone to make money in real estate. You get to hold onto a piece of property for a long term basis, watch the equity continue to build and someone else pays your mortgage. And this is the greatest time of all to get into this sort of real estate investment.
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