The allure of real estate riches found in 'house flipping' and note buying is great and it's made even more appealing by reality TV Shows, relentless "get rich" infomercials, and so called "real estate gurus". Proven Resource managing attorney briefly discusses the best course of action to take when preparing for a profitable and rewarding real estate investment business.

1. Real Estate Attorney
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NEW TO NOTE BUYING OR REAL ESTATE INVESTING?

2. The allure of real estate riches found in 'house
flipping' and note buying is great and it's made even
more appealing by reality TV Shows, relentless "get
rich" infomercials, and so called "real estate gurus".
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3. A recent survey of real estate in the news this past
month reveals a disheartening number of criminal
prosecutions concerning property investment scams.
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4. The US Attorneys Office for Western Texas announced
the federal sentencing of a group of house flipping
fraudsters after law enforcement professionals
exposed a property appraisal scheme that involved
over 800 properties and $45 million dollars of
fraudulent loans.
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5. These news stories alone are enough to create
significant pause for aspiring real estate investors
looking to cash in on “rich” property deals since
the Great Financial Crisis of 2008. Vetting deals for
potential fraud is but only the first thing that
investors need to do in their due diligence when
buying property.
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7. Owning distressed properties often involves legal actions
such as quiet title actions, evictions, and lawsuits from
former owners or even municipalities. Experienced
property owners already know that legal actions aren't
always so straight forward.
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8. For instance, a “simple” eviction action can be delayed
for months over a host of unforeseen reasons.
Investors need to have financial wherewithal in
addition to a strong stomach for business.
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9. Investors need to assess their legal exposure. For instance, recording
one’s property interest creates liability for not only property taxes,
but also for compliance with municipal ordinances or even federal
violations. In residential real estate, where “blight ordinances” are
enforced, investors are accountable for maintaining a property to
community standards.
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10. Compliance does not just concern the property itself. Real
estate businesses need to make sure their enterprise is licensed
properly for state regulators and for revenue agencies.
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11. Investors need to structure their deals with the ‘end game’ in
mind. For example, real estate investors may offer ‘seller’
financing to prospective purchasers. A private financing
agreement should conform to generally accepted lending
guidelines of the lending community.
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12. Proper document recordings, prudent loan servicing, and income
and payment verification are just several points investors need
to evaluate when offering private financing.
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13. These days it is not uncommon for real estate investors
to invest in distressed property markets outside the city
or state in which they live. Many out of state or foreign
investors have come into the market, and fast.
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14. But if one is not familiar with the area they invest in or they
don't have physical access to the property themselves, then
they had better find reliable advisers who know the
neighborhood, have access to trustworthy contractors and /
or property management companies, and knowledgeable
real estate legal counsel.
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15. The appeal of 'scoring' big money
in flipping properties should be
tempered with pragmatism. Many
a 'gold rush' has gone 'bust' for
lack of planning. Investing in real
estate is no different. One bad
transaction can create financial
havoc.
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16. Prudent real estate investors who
perform proper due diligence, hire
competent third party advisers and
contractors, and develop a realistic
exit strategy should have a higher
propensity of success.
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17. About the Author:
www.ProvenResource.com
31800 Northwestern Hwy.
Suite 350
Farmington Hills, MI 48334
Phone: (888) 789-1715
Disclaimer: You should not rely or act upon the contents of this article without seeking advice from your own, qualified attorney.