5 C's of Real Estate Investing

Competence - do you have a basic understanding of real estate investing or are you working with a group that does and is educating you?

Control - Are you in control of your emotions? Make sure you are level headed and react from a standpoint of knowledge and not emotion.

Comprehension - Do you understand the market you are investing in, the exit strategies you are going to use and how those interact?

Consistency - Are you being consistent with your goals? This is a common problem for some investors. They begin to get “hooked” - almost like a chemical reaction and pretty soon they are buying properties based on completely different criteria than the ones they first set out.

Character - Doesn’t need much explanation does it? Do things the right way - the legal way - every time! An investor committed to excellence and with strong character, will be successful.

You see, when a person decides to invest in real estate they have to make sure that the motive is right, the goals are clear and the exit strategy is in place. Any place can be a fantastic city to invest in, but it is also a fantastic city in which one can lose money when you do not exhibit self control, a solid comprehension of the area or be working with a group that does have these qualities along with a consistent investment strategy and game plan. I am being totally honest when I say that if you do not have a level of competency that allows you to understand the basic concepts of investing or the fortitude of character to stay on the right path and not take shortcuts - then you shouldn’t be investing in real estate in the first place.

In my opinion, with every decision you make as an investor, whether buying an investment property in the US or a condo in Central America, you should consult these 5 “C’s” as I call them and make sure you are protecting yourself, your family and your future.

Frequently Asked Questions

"This sounds too good to be true…"

Not really a question, but the single most common response we get. All we can say is, do your homework, read up on each market. Think about this: In market’s like Los Angeles, where a $400,000 home can be rented for under $1,650 per month, which does not nearly cover the mortgage, there is a market like Detroit MI, Jackson MS, Memphis TN, St. Louis MS, Indianapolis IN, Birmingham AL, Kansas City KS, and Cleveland OH where a home can be purchased for about $60,000 and rented out at $700 per month. Imbalances are the nature of markets, most importantly, they create opportunities.

"Why is there a Refinance Loan when I thought this was a Purchase?"

This is a very important question. Purchase loans do not allow for the buyer to take cash out of the property. Therefore we have arranged special financing that allows our buyers to get on title very quickly, and with little money out of pocket.

By staying within very specific guidelines of Loan-To-Value and credit quality, we can utilize special government backed loans (FNMA) for the refinancing that allows for using the full current appraised value. In the industry, we call that No Seasoning, and it’s a very good thing. Since the properties are bought way below the full current appraised value, this special loan structuring allows for the full price of the home to be covered to acquire it. That’s NOTHING DOWN net when all is said and done.

"What Are The Minimum Qualifications For The Refinance?"

If your income is easily verified via W-2’s and/or tax returns, then a credit score as of 680 may be acceptable, although 720+ is much preferable. Asset requirement is generally 3-6 months PITI, which on these loan sizes, translates to $5,000 or less in provable liquid reserves. You are taking on the obligations of a landlord, and reserves are important. It’s OK to wait for another property. We’ll have more, we promise. Of course, if you can show substantial liquid reserves, and/or have very high credit scores, this has a favorable impact on the rates and terms of your refinance loan; which will generally be a 30 year fixed loan with no pre-pay penalty.

"Is the Price Lower if I Pay Cash?"

The purchase price does get discounted in most markets, but there can also be substantial savings by avoiding the use of short term financing by using cash on hand or writing a check against your HELOC.

"If these are good houses, why don't you keep them and rent them yourself?"

We don't want to compete with our buyers for "the GOOD stuff." That said, we have been known to shop at the company store, but regardless of that, there are simply more properties available than can be had with property limitations.  As real estate investors it simply is not possible to participate in every real estate opportunity...Not even Donald Trump buys everything! The Real Estate Life truly enjoys matching up investors to investment properties and helping them build their portfolio as much as we enjoy building ours.

"Do you just sell the crummy houses no one else will buy?"

We are very careful about what we offer to other investors. We want your purchase to be a good one because…We want to provide you with several…maybe even MANY houses, not just one. We want to maintain a stellar reputation, locally and nationally. We do not offer property opportunities unless we would take it ourselves...sometimes we do! You can count on us to tell you the TRUTH about any investment you make with us. If we don't know the answer, we'll tell you so. We then will do our best to find out that answer.

"How can you offer houses so cheap?"

All the markets we sell saw an explosion of sales to first-time home buyers over the past 5 years. Unfortunately, many of those sales used adjustable rate mortgages. Now that they are adjusting upward, foreclosures are on the rise and I can buy good houses at good prices. Think of the late comers as our exit strategy...Many are also Investors who did not buy at the right point and have a higher rental point that cannot be attained for investment purposes.

"Do these markets have a good rental market?"

They have a GREAT rental market. Vacancies are decreasing and rents are stable to rising. Rents are adjusting upwards because competition for good rental houses are increasing, now that home sales have slowed.

Our markets are very landlord-friendly states.

"Who will manage it for me?"

There are several very competent property managers... The standard fee is 7 - 10% of the monthly rent. We have several different property management companies we can recommend. We have no economic interest in your choice here, so you may feel free to interview them all and choose one, or find your own. We have simply pre-screened them for your convenience.

"Who will do the repairs for me?"

We recommend a Home Warranty, but you work with your property manager and  REHAB Team. When the time gets closer, we will be happy to get you in direct touch with our preferred rehab managers and teams.

"It’s all so turn key, what is my role?"

Your job (grossly simplified of course) is to:

•    Do some paperwork and send in a check up front
•    Show up for the loan signing and shortly thereafter cash a bigger check back to you
•    Go to your mailbox once a month and get a check

“How Can I Be At The Front Of The Line?”

Now there's a great question. While we don't play favorites; all else being equal, the properties go to the people who are READY TO BUY.  Now what does that mean? That means that:

•    We have your completed loan application on file and pre-qualified with the lender- all supporting documents, etc. Go to www.YourRealEstateLife.com and  Click Here for an Application or on the Home Page APPLY NOW to the right side second button.

With those three things done, when you see a property you want, all you have to do is pick up the phone or drop an email to This e-mail address is being protected from spambots. You need JavaScript enabled to view it This e-mail address is being protected from spambots. You need JavaScript enabled to view it we can begin to close the deal for you. You can own the property in a week if we have everything on file.