Investing in Probate Real Estate

Finding Diamonds in the Rough

Did you know that there is a hidden market of real estate opportunity that is growing but has always but has been sort of a secret?

Did you know that in this hidden market, there of highly motivated home sellers – these are home owners willing to take a deep discount on the market value of their property, just so they can get out from under it?

Well, if you are ready to work with these homeowners, you will be in a market with much less real estate competition. This secret market full of diamonds in the rough is the market that has made many real estate investors their fortunes. The market is Probate Real Estate investing.

Why is Probate Real Estate Great for Investing?

You see, probate real estate is a growing market. Baby boomers own a great percentage of homes in the US. According to probaterealestatesales101.com, here are some interesting stats about the growth of this niche. “Baby boomers control 67% of US wealth.”  ”A baby boomer dies every minute.” “80% of probate real estate is owned free and clear or has a large amount of equity.” Finally, “85% of homes owned by individuals would end up in probate courts if owners died.”

So what exactly is probate real estate and why is it great for investing? Probate real estate involves the transfer of property upon the death of a homeowner. When a homeowner dies without the home being in a trust, the home and all of the deceased’s other assets end up going to probate court.

In probate court, a judge reviews the estate, all of the assets owned by the deceased, and appoints an administrator known as the Executor.  Sometimes the judge will act as the executor.  The executor manages the deceased party’s finances, divides and disburses the assets among the heirs as desired by the deceased.

Often, the new heirs or new property owners are not prepared or in a position to own the newly inherited property. A complex probate process can last for months or even years.  This process can be a detriment to the new heirs.

For many, the inherited property is distributed between more than one heirs.  The new heir(s) might live in another state or at a distance away from the property where it might become difficult to manage. The property might have a mortgage or two. It could carry a tax burden, and/or it might be in need of physical repairs.  Financially, many of these homeowners might not be able to make repairs, or spend the time and energy necessary to manage the property.  All of these issues can overburden the new property owners.

It is these property owners who are often looking for a quick way out. These are the motivated homeowner seeking to sell the property and get out from under the ownership. Many would rather cash in on the value of the property, and they are often willing to discount the property in order to quickly avoid a cash pitfall.  This is where probate property investing comes in.

Why not Invest in Probate Real Estate?

Why not invest in probate real estate? Many investors believe that purchasing a probate property is difficult.  They know that these transactions are tied to courts and that these transactions can have complications. They are often aware that a complex estate can make the probate process last for months or even years.  Since investing in probate property involves purchasing directly from the estate, many investors are either intimidated or unwilling to learn the steps necessary to invest in this niche.

However, what most investors don’t realize is that the Executors of the estate are empowered to make selling decisions.  Sometimes the selling decision must be approved by the judge overseeing the estate, but usually as long as the sale is agreed upon by all heirs, the judge will allow the transaction.  Since the laws differ from state to state, it is best for both the heirs and investors to work with probate certified licensed real estate agents to make sure all the transaction steps are met.

What is the Best Way to Find Probate Real Estate Properties?

What is the Best Way to Find Probate Real Estate Properties? Public records is the answer.

The first thing to do in probate investing is to the visit local courthouse. When an estate begins the probate process, the estate including the Will becomes a part of the public records. The Will usually lists the Executor and provides the information for the estate. Even if the decedent dies without a Will, probate records will show who will manage the estate.

Local courts can provide a list of all Wills in probate or to be presented in probate court. Armed with this information, an eager investor will quickly find property deeds in the name of the deceased persons. With the requirement of doing a little research, a potential investor can quickly create a list and find probate property owners to reach out to and possibly properties for sale. Learning the steps in this research process is another deterrent that limits the amount of probate property investors.

What is the Best Way to Contact Heirs about Purchasing Their Inherited Property?

The very first thing that must be considered is that the heirs have lost a loved one. They are probably burdened with both emotional stress and the stress of managing the inherited property.  With this new stress, these Executors are dealing with new duties that they may or may not be prepared to handle.  Many may not realize that they can sell their property during the probate process. By reaching out to these property owners, you can present them with an offer that they might be hoping to find.  Simply calling the administrator, sending a letter or visiting the person may find them ready to make a decision.

Letting the heirs know that you can help them solve their financial problems, you will be doing them a service. Many will be very happy to have the problem quickly taken from their hands and will settle for selling below market value. These owners will probably be willing to help the sale go through quickly for the return of instant cash.

Investing in Probate Takes Communication and Effort

As you can see, investing in probate properties does not take a great deal of training, however it is best to work with a real estate agent who is certified and trained in this niche.  To succeed in probate real estate investing, you will need to be part detective to find properties. You will need to be part negotiator and communicator.  You will also need to communicate empathy for the property owner’s situation.

Probate real estate investing can be beneficial for probate property owners and investors.  Probate real estate is a growing niche and is providing many opportunities for real estate investors. You will be in a position to succeed as long as you are well prepared and know the current market values.

Inherited Property

How a Probate Realtor Can Be Beneficial

When someone has passed away, it can be an emotional and difficult time for the family. A death of a loved one can be even more trying for the individual that is selected to oversee the distribution of their estate. When there is real estate property involved that needs to be sold, it can be a complex and confusing process for the estate representative.

From the legal matters to preparing the home for sale, there are numerous aspects that need to be tended to. This can make the circumstances overwhelming for the deceased person’s loved one during a time they should be grieving the loss of a family member. When selling probate real estate in Los Angeles, you would greatly benefit by hiring a professional who specializes in probate real estate sales.

Reasons to Hire a Probate Realtor

  • A realtor who specializes in probate sales has an understanding of how the process works to reduce the chance of a problem occurring during the sale.
  • The probate realtor will provide their clients with information to help them better understand how a probate sale works.
  • A realtor who handles probate real estate can manage the sale so the representatives can focus on healing from the loss of their loved one.
  • The realtor will negotiate the sale between attorneys, the beneficiaries of the estate, and potential buyers.
  • If the home needs to be repaired or updated before going on the market, the realtor can help find the contractors needed to repair the dwelling so the estate can receive top dollar for the property.

Know the Estate is in Trusted Hands

When you hire an established and knowledgeable probate realtor, you will have peace of mind knowing the estate is in trusted hands. Trust Probate Realtor, Andrea Shink understands how complicated and emotional selling property of a loved one is. That is why she and her team are devoted to helping probate property owners find a buyer for their property and take the burden of selling a deceased loved one’s property from their family.

Fourth Largest Real Estate Brokerage in United States to Acquire California Based Teles Properties, its 530 Agents, 20 Locations and Innovative Marketing Platforms; Acquisition to Include Additional Colorado Office

This article was first posted by Douglas Elliman on PRNewsWire.com at http://www.prnewswire.com/news-releases/douglas-elliman-to-expand-throughout-the-golden-state-300497555.html on August 1.

NEW YORK, Aug. 1, 2017 /PRNewswire/ — Douglas Elliman, the nation’s fourth largest residential real estate brokerage company, announced today that it has entered into a contract of sale to acquire Los Angeles-based Teles Properties. Upon closing, the operations of Teles will be under the umbrella of Douglas Elliman, making Elliman the second largest non-franchise brokerage firm in the State of California. Teles partners Peter Loewy, Sharran Srivatsaa, Peter Hernandezand Evan Ageloff will continue to have integral roles within Douglas Elliman, Western Region. Completion of the transaction, which is subject to customary closing conditions, is expected to take place during the second week of August 2017.

Once closed, Douglas Elliman will span 21 offices with 630 sales associates in California, from Coronado to Carmel; and 58 sales associates and five offices in Colorado. The acquisition will also add a Boulder location to Douglas Elliman’s Colorado brokerage which already operates in four locations in Aspen and Snowmass Village. In 2016, the combined organization accounted for more than $27.4 billion in total closed sales volume nationwide. Across the United States, Douglas Elliman will boast 110 offices and more than 7,000 agents.

“Our search for an exceptional company that offered unrivaled technology and marketing platforms, whose agents mirrored the entrepreneurial spirit of Douglas Elliman, led us straight to Teles Properties,” said Howard M. Lorber, chairman of Douglas Elliman Realty, LLC. “For almost a decade, buyers and sellers in California and Colorado have trusted Teles with one of their most valuable assets and important life decisions. Teles’ well-known reputation as a major driving force for the past 10 years, combined with Peter Loewy, Peter Hernandez, Sharran Srivatsaa and Evan Ageloff’sleadership experience, make this an ideal union.”

Long time Elliman executive Stephen H. Kotler, who in 2016 was named president of Brokerage Douglas Elliman, Western Region, will expand his role as chief executive officer of Brokerage Douglas Elliman, Western Region, overseeing operations throughout California and Colorado.

“We are proud to welcome Teles Properties and its fine team of real estate professionals to Douglas Elliman,” said Mr. Kotler. “Both brokerages share the same high level commitment to advancements in technology and marketing aimed at delivering exceptional real estate experiences for clients. We are extremely impressed with Teles’ innovative marketing and technology platforms and approach to agent training and development. This move greatly strengthens our presence in California and Colorado where Teles’ impressive track record in the luxury home market speaks for itself.”

Since 2007, Teles Properties has been a prominent force in serving sellers and buyers of California and Colorado homes, ranging from oceanfront houses in Orange County to Malibu mansions to cliff side estates in Pebble Beach. With over $15 billion in cumulative sales since 2012 alone, Teles was named by IncMagazine as one of the fastest growing companies in America as well one of the best entrepreneurial U.S. companies by Entrepreneur Magazine.

“After a decade of growing this company to nearly 600 licensed professionals and staff, I consider this union with Douglas Elliman to be our best growth initiative yet,” said Peter Loewy, who will serve as chief executive officer of brokerage for California. “We are gaining exposure in markets around the world via Elliman’s global alliance with Knight Frank and elevating our strategic planning in order to optimize growth as well as agent and customer satisfaction.”

“There is no other company that could match the national and international reach that our agents and clients will gain from this union,” said Sharran Srivatsaa, who will be named president of brokerage, Western Region. “From its new television, print and digital brand campaign, “It’s Time for Elliman,” to its quarterly magazine, ELLIMAN, to its social media and public relations prowess, operating under the Douglas Elliman banner will help propel our agents to new, untold levels of success.”

“We are joining forces to bring the strongest global real estate experience together under one organization,” said Scott Durkin, Chief Operating Officer of Douglas Elliman Real Estate. “This is an excellent acquisition for all, because, as part of Douglas Elliman, Teles agents will have more opportunities for exposure while expanding service areas and professional expertise for home buyers and sellers throughout California and Colorado. In addition, the referral opportunity for our agents grows even stronger for their clients in the multiple home market.”

Teles executive Peter Hernandez will stay on as President of Brokerage for California; as will Evan Ageloff who will serve as Chief Operating Officer of Brokerage, Western Region.

About Douglas Elliman Real Estate

Established in 1911, Douglas Elliman Real Estate is the largest brokerage in the New York Metropolitan area and the fourth largest residential real estate company nationwide. With more than 7,000 agents, the company operates approximately 110 offices in ManhattanBrooklynQueensNew JerseyLong Island, the Hamptons & North Fork, WestchesterGreenwichSouth FloridaColorado and California. Moreover, Douglas Elliman has a strategic global alliance with London-based Knight Frank Residential for business in the worldwide luxury markets spanning 60 countries and six continents. The company also controls a portfolio of real estate services including Douglas Elliman Development Marketing; Manhattan’s largest residential property manager, Douglas Elliman Property Management with over 250 buildings; and DE Commercial. For more information on Douglas Elliman as well as expert commentary on emerging trends in the real estate industry, please visit elliman.com.

SOURCE Douglas Elliman

 

What Is a Home Service Contract, or “Warranty?”

Asian American Family  parents making house over the kids.

The National Home Service Contract Association (NHSCA) defines home service contracts, or “warranties,” as contracts offering repair, replacement or service for major appliances and systems that break down as a result of “normal” use. Home service contracts, according to the Association, are a significant means of savings for homeowners, with coverage ranging from disposals and ovens to HVAC systems.

“The wholesale value of these contracts easily exceeds $1 billion in savings to consumers annually,” said Mike Bartosch, president of the NHSCA, in a recent statement.

Home service contracts are not the same as homeowners insurance. Said Bartosch, “Home service contracts and homeowners insurance policies are mutually exclusive products in all 50 states. NHSCA members are not insurers and do not sell an insurance product. Further, insurance products don’t cover service, repairs or replacement to home systems and appliances required as a result of normal wear and use.

“If a system or appliance stops working, contact your home service contract provider,” Bartosch added in the statement. “If a home system or appliance is damaged by a falling tree, catches fire, or is subject to vandalism, contact your insurance agent.”

Real estate professionals often offer home service contracts—in this case, “warranties”—to homebuyers and/or sellers. The term “warranty,” according to the NHSCA, refers to the seller’s action of purchasing a service contract for the buyer should issues arise during the first year of ownership. If you’re a buyer or seller, consult with your real estate agent or broker to learn more about the options available to you.

For more information, visit HomeServiceContract.org.

Source: National Home Service Contract Association (NHSCA)

6 Major Mortgage Mistakes

6 Major Mortgage Mistakes

Image of a mortgage loan document being signed.

Whether you’re scoping out a vacation property or looking into becoming a homeowner for the first time, applying for a mortgage is a lengthy and complicated process. While your real estate agent and lender will be there to walk you through the details, knowing what possible errors could lay in waiting will help you make the best decision. Let’s review some of the most common mortgage mistakes so you can avoid making them.
1. Weak credit history
Loans are all about credit history – it’s hard to land a mortgage without one. But having a credit history doesn’t mean you have a lot of credit; it simply means you have been given credit in some form and have a documented history of repaying it. How much credit? Lenders often like to see at least three lines of credit with a minimum two-year history on each.
And of course, you don’t just need a credit history; you need a good one. Pay down credit cards and loans regularly to heighten your score.
Pro tip: Paid off that credit card? Don’t cancel the account. Keeping the account active, even if it’s unused, helps build a strong credit history.
2. Weak work history
You’re less likely to get a loan if you can’t prove you’re able to hold down a job. And even if you do get approved with a weak work history, you may not be able to qualify for a good interest rate. What is a strong work history? Aim for at least two current, consecutive years of employment in the same occupation.
Of course, certain circumstances may provide an exception to this rule. If you are a recent graduate with proof of future income, or someone who is coming back out of retirement, some lenders may not hold a lack of recent employment history against you.
3. Opening new credit accounts
Maybe you got a big raise and are applying for a mortgage and leasing a brand new car all in the same month – bad idea. If you’re thinking of applying for a loan, avoid opening brand spanking new credit lines. Lenders like to see solid, stable credit histories, and a brand new line of credit can’t offer that. Unfortunately, some people make this mistake thinking that it will help their credit score, when in truth it can hinder it.
4. Making big purchases
Slow down there, big spender. Just like lenders want to see stable credit history and employment, they want to see stable spending. If you make large charges to your existing credit accounts around the time you’re shopping for a mortgage, you can increase your debt-to-income ratio. So hold off on that new furniture set or big screen TV until after you’ve purchased your home.

5. Not reviewing your credit report
When is the last time you checked your credit? Often, credit reports have errors, and you want to right these before it’s time to apply for your mortgage.
6. Not knowing what you can afford
These days, it’s very easy to figure out how much home you can afford. Simply find a mortgage calculator online, take a look at how much you can pay each month, and plug in the numbers. This will give you a solid idea of how much house you can afford, which can help you avoid disappointment down the road. It’s also important to get pre-approved for a loan before you begin your home search. There have been many instances where a home sale falls through because the buyers made an offer that they couldn’t back up with a mortgage. By showing that pre-approval letter, the buyers are showing the sellers they can afford to make good on their offer, and may also be in a better position to negotiate. And these days, many real estate professionals won’t work with a buyer who isn’t pre-approved.

Expert Insights: What Is a Wraparound Loan?

Image of loan disclosure statement

Also called an all-inclusive mortgage, it is where a new home loan is placed in a subordinate or secondary position to the original mortgage and the new loan includes the unpaid balance of the first.
The wraparound allows the buyer to purchase a home without having to qualify for a loan or pay closing costs. The contract is made between the buyer and seller with the seller remaining on the original mortgage and title. The buyer pays the seller a fixed monthly amount and the seller uses part of this money towards the existing loan.
The seller benefits by offering the buyer a loan at a higher interest rate than the existing mortgage, and the lender profits from the difference in interest in the two loans.
Wraparounds are not for novices and cannot be used when there is a legally enforceable ‘due on sale’ clause in the first mortgage.
Consult an attorney if you are considering this type of financing.

Home Staging Do’s and Don’ts

Strategically staging your home is a sure-fire way to help your home sell faster at the best possible price. As your local real estate professional, I want to share with you this infographic, which will help you consider some staging do’s and don’ts for maximum benefit. Should you hang a mirror? Should you not crowd a room? Read on!

Home Staging Infographic

Research: Home Equity Major Retirement Asset for Most

Image of a house sitting on money.

One of the most significant advantages of owning a home is the ability to build wealth—and according to a recent report from the Employee Benefit Research Institute (EBRI), home equity is one of the top two assets households rely on in retirement, barring pension or Social Security benefits.

The report, “Importance of Individual Account Retirement Plans and Home Equity in Family Total Wealth,” compared assets in households headed by those between the ages of 25 and 64, computing the share of assets comprised of home equity and retirement plans (e.g., 401(k), IRA)—the other key source of income in retirement. The median share was 78.2 percent, and even higher when focused in on the 55-64 age range: 87.4 percent.

“The data show that it is overwhelmingly the case that individual account (IA) retirement plan assets, plus home equity, represent almost all of what families have to use for retirement expenses outside of Social Security and traditional pensions,” said Craig Copeland, author of the report and senior research associate at EBRI, in a release.

Markedly, the presence of an IA can be an indicator of a household’s assets overall. More than three-quarters (79.6 percent) of households without an IA have less than $10,000 in assets, according to the report, suggesting some link between having an IA and owning a home.

“Those families without IA assets typically have very low overall assets, so they have almost nothing to draw from for retirement expenses (outside of Social Security),” Copeland said.

Source: Employee Benefit Research Institute (EBRI)

For more real estate information, including a FREE Home Market Analysis, please contact me at trustprobaterealtor@gmail.com or on my mobile phone at 310.749.6440.

Reprinted with permission from RISMedia. ©2017. All rights reserved.

4 Easy Ways to Improve Your Credit Score

4 Easy Ways to Improve Your Credit Score

Improving your credit score can be one of the best things you can do for your finances. A high credit score can lead to lower interest rates on home loans and better credit card rewards.

Getting an excellent credit score isn’t too difficult if you have good credit habits. Here are four easy ways to improve your credit score:

1. Fix errors: This may be the easiest fix, and starts when you get a copy of your credit report for free from annualcreditreport.com. An estimated 21 percent of consumers have errors on their credit reports, according to a 2013 study by the Federal Trade Commission.

Federal law gives you the right to check your credit report for free, and allows you to dispute errors that you find on the report with the credit reporting agencies.

2. Pay your bills on time: Not only will you avoid late fees, but paying your bills on time will show creditors that you’re a low risk. Even if you only miss paying a bill by a single day, it can hurt your credit score.

Payment history makes up 35 percent of FICO scores, or the Fair Isaac Corporation, which rates excellent scores at between 781 to 850. That’s the credit score you should be shooting for.

3. No high balances: If you can’t afford to pay off a credit card bill in full each month, you should aim to keep the balance as low as possible.

Up to 30 percent of a credit score is based on the amounts owed, also called “credit utilization.” It’s the ratio of outstanding debt to available credit. A ratio of 10 percent is preferred for a high credit score. For example, if you have a credit limit of $10,000 and you’re using $5,000 of it, then you credit utilization ratio is 50 percent, which is way too high to be considered good credit use. The lower the percentage, the better.

4. Raise your credit limits: If you can’t pay off your credit cards completely each month or have a high credit utilization number, then one way to improve your credit score is to increase the credit limits on your credit cards.

The increased credit will cause your utilization ratio to fall, but only if you don’t use it to take on more credit card debt.

By implementing these tips, it may only be a few months before your credit score improves and you can really get what you want out of it — a better interest rate on a loan.

Aaron Crowe is a freelance journalist who specializes in personal finance topics.

Courtesy of http://rismedia.com/ace-branded/

4 Tips for Picking the Right Neighborhood

Portrait of a happy young African American family standing in front of their American suburban home.

Oh, the places you will go…and the places you will want to avoid. Choosing the right neighborhood is as important as picking the right house. Your neighborhood will define many aspects of your day-to-day life, so you should research it carefully to be sure it meets your needs.

Realtor.com® lists four things you should consider before putting your real estate agent on the hunt. This will ensure you find the neighborhood that’s just right for you.

Establishing Priorities: Not all neighborhoods have the same kind of layout. Because of this, it is important that you decide on a style of house, whether it’s big or small, has a yard or a porch, etc. After that, consider your budget, taking into account what you can and cannot live without. Are you big on golf? Swimming? Make sure your neighborhood has access to the right facilities.

School Districts: Whether you have kids or not, neighborhoods with good schools are always a better bet. It is estimated that homebuyers will pay up to $50 more per square foot for properties located in good school districts. Of course, if kids are in the mix, then take a look at what’s available. Real estate agents aren’t allowed to divulge direct information on specific schools thanks to the Fair Housing Act, but they can point you in the general direction, like local school-system ratings.

Transportation: Your new property will be your home base, but don’t forget about your commute to work. If you’re good with driving, the suburbs can work for you. If you’re a major train hopper, then being close to a city center or somewhere with access to public transportation will be in your best interest. Homes tend to be more expensive when located close to travel hubs, but you will most likely save in terms of time, convenience, and money itself in the long run.

Compare and Contrast: When you’ve narrowed down your options, visit the prospective neighborhoods at different times to make a more-informed decision. You can also speak to current residents while you’re visiting to help you weigh out your options. There’s a good chance you will need to compromise and prioritize, but the idea is to pick a neighborhood akin to your ideal one.

A perfect home often has more to do with your comfort than with perfection. Following this train of thought will allow you to determine the best options for you. Think of it like trying on new shoes: one size does not fit all.

Courtesy of http://rismedia.com/ace-branded/