BiggerPockets Daily

DSCR loans, while still a relatively new product, continue to expand in use and popularity for investors looking to achieve financial freedom through real estate. Throughout 2023, we have published several articles on DSCR loans, introducing the BiggerPockets community to how interest rates and terms are determined, giving answers to frequently asked questions about DSCR loans and talking about exciting new developments and expansions of the product, including DSCR loans for five- to 10-unit multifamily properties. This article will cover another big aspect of DSCR loans–specifically, what documents you will be expected to provide once you have decided to go with a DSCR loan. One of the most enticing aspects of DSCR loans for investors is the lower documentation, paperwork, and overall “hassle” when compared to more traditional lending, including conventional and bank options. However, DSCR Loans should not be considered “no doc” loans–they do include a well-thought-out underwriting process and meaningful “common-sense” documentation requirements as well. Sometimes people can be misinformed, thinking these are loosely originated mortgage loans akin to the “NINJA” (no income, no job, and no assets) loans that were common in the early 2000s and helped lead to the last real estate crash. Learn more about your ad choices. Visit megaphone.fm/adchoices

In a recent economic outlook by Morningstar, the housing market affordability is currently mimicking the peak of the housing bubble in 2006. This similarity is due to a combination of mortgage rate hikes, rising home prices, and income levels. In light of this, Morningstar suggests that falling mortgage rates will play a vital role in improving housing affordability by 2025. Here, we’ll shed some light on the various factors that are making an impact on mortgage rates and what it will mean for American real estate investors. Learn more about your ad choices. Visit megaphone.fm/adchoices

As a real estate investor, you should understand the NAICS code that relates to your industry. This article discusses the finer details of this code system and its impact on your business. What Is a NAICS Code? The North American Industry Classification System (NAICS) is developed by the United States, Canada, and Mexico to classify businesses into industry-specific categories for economic data collection, analysis, and reporting. In some states, providing your NAICS code is optional, but in other states, providing your code will be required. Learn more about your ad choices. Visit megaphone.fm/adchoices

I recently got an unexpected lunch invitation. The most successful real estate developer I know made a beeline for me in the church lobby. He requested lunch as soon as possible. We met for lunch the next day. We hadn’t even ordered when he started pouring out his heart: “I’ve got a problem. I’ve been doing business with two banks for decades. One of the bankers has become a close personal friend.” He paused with a pained, pensive stare at nothing. “But they’re both acting…weird. They seemed nervous last fall. But now it’s more serious than that.” He went on to describe how his favorite banker changed the terms and then outright canceled an approved loan days before closing a few weeks before. This deal had been in the works for well over a year. My friend had to make a painful phone call to the seller to sheepishly ask for an extension to a now-uncertain closing date. Learn more about your ad choices. Visit megaphone.fm/adchoices

Large investors expanding their affordable housing portfolios has recently become a notable trend in the real estate market. Nuveen, the investment management division of the Teachers Insurance and Annuity Association of America (TIAA), made headlines with its acquisition of a substantial 12,000-unit affordable housing portfolio, predominantly located in the mid-Atlantic region, with a significant concentration in New York City. Nuveen, which manages $1.1 trillion in assets, is now managing a $6.4 billion portfolio of affordable housing. Prior to this deal, Goldman Sachs, alongside the Michaels Organization and the Community Development Trust, purchased $1.2 billion worth of affordable housing across the United States earlier this year. These investments reflect a growing trend among large investors who recognize the advantages of affordable housing investment. Learn more about your ad choices. Visit megaphone.fm/adchoices

Think big! Accumulate hundreds or even thousands of units. Use economies of scale. Syndicate. Benefit from maximum leverage. In other words: Go big or go home. Aren’t these the messages we hear so often here on BiggerPockets? Aren’t the biggest and the best the ones with the most cash flow, the most flips, and the most rental units? Well, I’m here to tell you that bigger is not always better. In fact, in this article and my new book, The Small and Mighty Real Estate Investor, I plan to show you that smaller and simpler is actually better for many of you. I’m trying to start a new movement. I hope some of you will join me. The motto is “go small or go home.” And the hero is called the small and mighty real estate investor. Learn more about your ad choices. Visit megaphone.fm/adchoices

Think big! Accumulate hundreds or even thousands of units. Use economies of scale. Syndicate. Benefit from maximum leverage. In other words: Go big or go home. Aren’t these the messages we hear so often here on BiggerPockets? Aren’t the biggest and the best the ones with the most cash flow, the most flips, and the most rental units? Well, I’m here to tell you that bigger is not always better. In fact, in this article and my new book, The Small and Mighty Real Estate Investor, I plan to show you that smaller and simpler is actually better for many of you. I’m trying to start a new movement. I hope some of you will join me. The motto is “go small or go home.” And the hero is called the small and mighty real estate investor. Learn more about your ad choices. Visit megaphone.fm/adchoices

Wholesaling is a popular strategy that many real estate investors use to earn money from homes without owning them. They get to avoid dealing with maintenance issues, tenants, and other landlord issues necessary with other strategies. If you are interested in wholesaling but aren’t sure about how to find potential properties, there are several simple things you can do to locate them. Wholesale opportunities come up all the time. With the right marketing strategies in place, leads may come to you. This lets you concentrate on what you do best—closing deals. Learn more about your ad choices. Visit megaphone.fm/adchoices

The internet altered the world, and for the most part, it was a good thing. Most products and services got better, but not insurance—it got lost. Before the internet, the insurance sector centered around an agent-driven business model in which insurance companies manufactured products and insurance agents sold them to consumers: home, vehicle, life, and business insurance. Insurance carriers learned that with the internet, they could sell straight to the consumer through the click of a button—eliminating the local agent’s need for a sales commission. Because of this shift, most insurance agents nowadays lack the knowledge and in-depth understanding of the coverage they provide in the complex 100-page contracts they sell. This results in the slow, agonizing demise of the professional insurance salesperson Learn more about your ad choices. Visit megaphone.fm/adchoices

Many successful real estate investors know the secret of finding and buying off-market properties. While discovering these deals may be tricky, you may stumble upon a great and lucrative real estate investment if you know how to find off-market properties. What is the best way to find off-market sales? Are there advantages to searching off-market property sales for investment opportunities? What should you be careful of when buying a property off-market? This article answers these questions and many more. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate mentors are very powerful allies to have in your corner. They’re real estate industry experts with years of experience and wonderful teachers who can help guide you through the most challenging problems and provide the most relevant guidance when we least expect it. Not only that, but mentors are valuable resources who can provide incredible insights into very specific areas of your personal life as well. It seems like every would-be entrepreneur, whether in real estate or elsewhere, is looking for a mentor—and with good reason. On the other hand, experienced real estate mentors can be seen as advisors who will do a lot of hand-holding through all the possible challenges on the journey to success. That’s not quite the case. In this article, we’ll talk about what a real estate mentor is and how to find one. Learn more about your ad choices. Visit megaphone.fm/adchoices

If you’re a real estate investor that needs help marketing, you’re not alone. A dedicated real estate marketing plan allows real estate professionals to generate additional leads and revenue. The world of real estate is highly competitive, so having an effective marketing plan to capture the attention of potential clients is important. Many real estate investors are twiddling their thumbs without a marketing plan because they can’t figure out how or where to start. This article will review the top real estate marketing ideas or strategies investors should use to promote their businesses. Learn more about your ad choices. Visit megaphone.fm/adchoices

Choosing between a HELOC vs. home equity loan is a big decision. HELOCs have variable interest rates and home equity loans have fixed rates, but that’s not the only difference. Check out how they compare to see which makes the most sense for your real estate business. Learn more about your ad choices. Visit megaphone.fm/adchoices

Buying a vacation rental property can bring lucrative returns for real estate investors. A vacation home can generate high rental income, provide tax breaks, and give you a second home for your own vacations. However, ensuring a good return on the investment property requires careful research into local markets, calculating your expenses, and understanding the rhythm of vacation rental properties. Investing in a vacation rental property requires a different investment strategy than a typical buy-and-hold property. A vacation rental home typically has more vacancies throughout the year. Also, short-term vacation rentals have higher maintenance costs and experience seasonal highs and lows. This article will guide you through the process of buying vacation rental property. You will learn how to analyze the rental market, find the right vacation rental property, and maximize profits from rental income. Whether you’re a first-time real estate investor or a seasoned pro looking to add to your portfolio, these tips and tricks will help you make a smart and profitable investment in short-term rentals. Learn more about your ad choices. Visit megaphone.fm/adchoices

Multifamily property investing diversifies your efforts in real estate investing. Right off the bat, you use an intensified and diversified investment strategy to buy multiple homes with a single purchase. Owning a multifamily real estate property means you can earn income from multiple rental units in one property versus investing in single-family properties. Learn more about your ad choices. Visit megaphone.fm/adchoices

Multifamily property investing diversifies your efforts in real estate investing. Right off the bat, you use an intensified and diversified investment strategy to buy multiple homes with a single purchase. Owning a multifamily real estate property means you can earn income from multiple rental units in one property versus investing in single-family properties. Learn more about your ad choices. Visit megaphone.fm/adchoices

35% of Americans state that real estate is their most favored long-term investment strategy, compared with stocks (21%), CDs and savings accounts (17%), and gold (16%). However, when considering real estate investing, we often think of flipping houses, short-term rentals, and the BRRRR method. Not everyone wants to put that much effort into an investment, and that’s when passive real estate investing strategies come in handy. Passive real estate investing can be an incredibly effective way to make your money work for you and requires little effort on your part. In this post, we’ll discuss: What passive real estate investing is, and how it differs from active investing The pros and cons of passive real estate investing Types of passive real estate investments How to get started as a passive real estate investor Let’s get started. Learn more about your ad choices. Visit megaphone.fm/adchoices

A home equity loan provides access to the equity in properties you own, using the funds for other purposes, such as increasing your real estate portfolio, paying a significant expense, or even debt consolidation. You have equity in a property when you owe less on any property liens than the property’s value. To calculate the equity, subtract any loan amounts from the home’s current market value. If your properties have equity, here’s everything you must know about a home equity loan. Learn more about your ad choices. Visit megaphone.fm/adchoices

As a real estate investor, there are several different approaches you can use to make some quick cash or grow your portfolio. With so many real estate investment strategies available, it can be overwhelming to determine which option is the best for you. In this article, we’ll explore some of the most commonly used investing strategies and help you determine which aligns with your financial goals and personal preferences. We’ll do this by: Explaining how each strategy works Discussing how much experience and effort is required Determining how much you need to get started and the return you can expect from it Are you ready to figure out which investing strategy is right for you? Let’s get started! You can read through all the strategies below or skip to the ones that interest you the most: House Hacking The BRRRR Strategy The PRR Strategy House Flipping Live and Flip Real Estate Wholesaling Turnkey Properties Mobile Homes Foreclosures Storage Spaces Real Estate Mortgage Notes Real Estate Investment Trusts Land Commercial Property Learn more about your ad choices. Visit megaphone.fm/adchoices

When building wealth, there is no shortage of investment opportunities. Stocks, bonds, mutual funds, ETFs, precious metals, and more all play a role. However, many of the world’s great fortunes are based on real estate investing. Let’s examine why real estate is a good investment and how you might build significant wealth. Reasons Why Real Estate is a Good Investment Cash flow, passive income, tax breaks–the list goes on. Here are just a few of the reasons why real estate is a good investment: There is a steady cash flow As a real estate investor, you can generate a steady cash flow if your investment properties have tenants. Calculate your cash flow by deducting your mortgage payments, property taxes, insurance, and maintenance expenses from the gross rent. Learn more about your ad choices. Visit megaphone.fm/adchoices

When it comes to managing your tenants and properties, you want to ensure that you’re doing so efficiently. Not only does it help your business stay organized, but it also helps foster a good working relationship with your renters. Fortunately, you’re not alone when it comes to managing your real estate business. Using property management software can be an advantage when it comes to cultivating a good landlord-tenant relationship and streamlining how you manage your properties. Learn more about your ad choices. Visit megaphone.fm/adchoices

Over the last decade, real estate investors have used Airbnb to rent properties and meet new people worldwide. The short-term rentals business continues to grow—in 2021, the typical U.S. host made $13,800 on Airbnb, an 85% increase over Airbnb host income in 2019. Suppose you’re serious about purchasing a vacation rental property and becoming an Airbnb host as a side hustle or full-time income. In that case, you need to understand the service fees involved in using the platform so you can price your property accordingly. So how much does Airbnb take from hosts for service fees? Let’s break down what Airbnb charges hosts, how other listing platforms compare, and what savvy investors should know to run their short-term rental business. Learn more about your ad choices. Visit megaphone.fm/adchoices

What Is a Squatter? A squatter is an individual who occupies a piece of real estate, despite having no legal claim to the property. Squatters live on a property in which they have no legal title, rights, or lease agreement. However, this individual may gain legal rights to the property by adverse possession, which is the legal transfer of ownership to a squatter due to continuous land occupation. Squatting Example There’s no shortage of squatting examples, but here are the basics of one of the most common scenarios. You purchased an investment property in 2020 and rented it to a tenant for two years. At the beginning of 2022, you stopped renting the property, which remained empty for several months. Then, you decided to put it on the market. Unfortunately, when preparing the home for listing, you found a squatter living there for several months. Learn more about your ad choices. Visit megaphone.fm/adchoices

“Squatters’ rights” are two words that evoke an emotional reaction in landlords everywhere. Getting rid of squatters can be challenging due to legal complexities surrounding property rights and eviction processes. In many states, squatters may be granted certain legal protections over time, making it more difficult for property owners to evict a squatter without following proper legal procedures, which can be time-consuming and costly. Depending on the local laws, property owners may need to follow specific eviction processes, such as obtaining court orders, to lawfully regain possession of their property from squatters. But that doesn’t mean squatters can act with absolute impunity. Property owners have rights to their property and can take legal action to remove squatters. Here are five creative (and legal) ways for handling squatters that smart investors should know to avoid the stress and financial burden of lost rental income, property damage, expensive repairs, and a painfully long eviction process. Learn more about your ad choices. Visit megaphone.fm/adchoices

A critical yet often overlooked part of the real estate investing puzzle is crafting a comprehensive and detailed Statement of Work (SOW). Whether you’re a seasoned or a rookie investor, you can benefit significantly from this powerful tool. Your SOW helps keep your project on track and can be instrumental in securing financing for a fix and flip property, particularly from hard money lenders. Let’s dive into why a detailed SOW is critical and how to create one. Learn more about your ad choices. Visit megaphone.fm/adchoices

If you’re not into traditional budgeting, where you place all of your spending into rigid categories, then the 50/30/20 budget rule might be for you. This financial management budgeting method is broken into three main categories: 50% needs, 30% wants, and 20% savings and investing. It’s designed to take a full picture of one’s monthly living expenses in the simplest way possible and remove the nitty gritty details that can bog someone’s bank account down with complications. So, in theory, if your after-tax income is $5,000 a month, $2,500 should go to your needs, $1,500 to your wants, and $1,000 to your savings and investing goals. Let’s talk more about how this all works. Learn more about your ad choices. Visit megaphone.fm/adchoices

When you’re in the market for a new property, one of the first things you’ll want to do is apply for a mortgage preapproval. This process can help you determine your budget, refine your house-hunting efforts, and give you an edge in a competitive market. Let’s walk through the basics of mortgage preapproval, how it differs from prequalification, and why it’s important when buying a home. Learn more about your ad choices. Visit megaphone.fm/adchoices

What’s the number one skill all real estate investors need? It’s how to accurately estimate after-repair value (ARV). This critical skill could help you determine if a property is a good investment or something you should pass on. Knowing the value of a property is essential. Whether you’re a buy-and-hold investor interested in turnkey properties or a fix-and-flipper looking for a property needing serious work, you need this information. “Buy low and sell high” is real estate’s core success formula—but to know you’re getting a good deal when you buy, you need to know how to estimate future value. Here’s how real estate investors can calculate ARV for single-family homes or other small residential properties. Commercial or larger multifamily properties are not covered here because they require a different process. Learn more about your ad choices. Visit megaphone.fm/adchoices

So far, throughout 2023, we have published several articles on DSCR (debt service coverage ratio) loans, a loan product that continues to grow in popularity among real estate investors. These included an overview of how to get the best rate and terms, how to use advanced strategies to maximize returns, and an overview of the new small multifamily DSCR loans niche, which expands the loan product to properties with up to 10 units! In May, we posted 12 Frequently Asked Questions (And Answers) About DSCR loans. This proved very popular and helpful for real estate investors exploring this transformative loan product. More questions and advanced scenarios continue to flow and get discussed in the BiggerPockets forums, so we have decided to publish another installment to cover more of your questions! Learn more about your ad choices. Visit megaphone.fm/adchoices

Realtors are essentially intermediaries between buyers and sellers, so realtors get paid on commission when you close on a property. But who is responsible for that fee, and how much commission do realtors normally take? This article explains how realtor commission works and when they receive their payment. What Is The Difference Between a Realtor and a Real Estate Agent? It’s very common to use the terms “realtor” and “real estate agent” interchangeably, but there is a difference between the two. Realtors are normal real estate agents and National Association of Realtors members. On the other hand, real estate agents are licensed professionals working in the real estate industry. Both real estate agents and realtors assist buyers and sellers in purchasing and selling real estate. Still, only realtors adhere to a code of ethics set by the National Association of Realtors. Learn more about your ad choices. Visit megaphone.fm/adchoices

Suppose you come across a house or land that interests you but don’t see a for sale sign. You might wonder how to find out who owns a property. Since property ownership records are public, you can access the property data quickly, especially if you have the property’s address. But not all cases are easy; sometimes, it takes some work. Whether you’re considering the home for your primary residence or to purchase as a real estate investor, knowing how to do a property owner search can be useful. Learn more about your ad choices. Visit megaphone.fm/adchoices

Multifamily properties are among the most common types of housing that investors rely on to grow their portfolios. They provide consistent and reliable income, have relatively low vacancy risk, and typically appreciate over time. Working with a multifamily real estate agent is smart if you are considering investing in this type of property. These professionals can help you find what you are looking for in less time and possibly help you save money during the negotiations. Learn more about your ad choices. Visit megaphone.fm/adchoices

PropTech is a relative newcomer to the “Tech” suffix world; you may be more familiar with the more recognizable MarTech and FinTech terms. While this terminology may be trendy and buzz-worthy, what does it really mean to put it to work in your real estate investment business? Keeping your competitive edge, and creating efficiencies across your growing portfolio, requires deft use of technology. Implementing the wrong solution or technology that doesn’t deliver value can be a costly mistake. Understanding which technology can have the greatest impact on your bottom line is essential. Learn more about your ad choices. Visit megaphone.fm/adchoices

Real estate offers a variety of investment options. Tax lien investing is another method for real estate investors to make money, and while it is a little different than your typical buy, flip, and sell, there are some similarities. Some tax lien investments turn into property ownership if the property owner fails to pay back the property taxes on time. Finding homes with delinquent property taxes is more challenging than looking for a standard investment property. You have more hurdles to jump and factors to consider. Here are the steps to take and the pros and cons to consider. Learn more about your ad choices. Visit megaphone.fm/adchoices

As a real estate investor, buying a new property is a significant personal and financial decision. While the process can be challenging sometimes, it’s all worth it once the transaction is complete. Understanding how to purchase a house is vital to your success, and that’s particularly true of the closing process. One of the most important questions is, “How long does it take to close on a house?” In this article, we dive into the finer details of the closing process. Learn more about your ad choices. Visit megaphone.fm/adchoices

Workers were adding the finishing touches to a Ranch-style home just when an all-black Tesla Model 3 pulled up to the job site. As the door opened, an investor stepped out into the Dallas, Texas, heat. Enthusiasm emanated from this seasoned flipper as he encouraged his team and lent a hand. This is Don’nell Greer. With over 200 flipped houses under his belt, Greer is a real estate pro who has managed to build an impressive real estate machine. He started in Dallas and has since expanded his operations to include the entire Dallas-Fort Worth metro area, as well as parts of St. Louis, North Carolina, and Tennessee. Despite his ever-growing success, this Lone Star State flipper remains eternally grateful for his situation and wants to help others find financial freedom. In this article, Don’nell shares how he got started, tips for investors, and other key takeaways from his storied career in real estate. Whether you’re a veteran investor or a newbie, there’s plenty to learn from his story. Learn more about your ad choices. Visit megaphone.fm/adchoices

Congrats! You just closed on your new STR. Now the race is on to fix everything and prepare it for guests and 5-star reviews. As you contemplate your rental tech stack and how to get beds in bedrooms ASAP, don’t ignore your walls! These are the touches that will help cement your vibe, make guests feel like they’re entering a cared-for home, and are often the details that get mentioned in guest reviews on sites like Airbnb and VRBO. (A recent review of my own STR: “The house was clean, tastefully decorated, and had everything we needed” The guest mentioned only three things, and one was décor!) Learn more about your ad choices. Visit megaphone.fm/adchoices

As a property owner, you’ll likely have neighbors who own property near you. And while friendly neighbors can make an area enjoyable, they can also be a source of frustration for many residential and commercial property owners. One common frustration between neighbors is encroachment in real estate, when someone uses or builds on someone else’s land. On its face, encroachment isn’t a particularly tough concept for smart investors to grasp, but it’s far more complex. Here’s what you, the savvy BiggerPockets-reading real estate investor, need to know. Learn more about your ad choices. Visit megaphone.fm/adchoices

Many landlords believe property management fees cut profit margins to a minimum in exchange for basic services to maintain your rental property. But the reality is that a property manager can simplify your life and smooth out the kinks in your investment properties—for a reasonable rate that maximizes profitability. A recent survey of landlords found that over 88% had experienced stress in renting out their properties, and over 44% had to evict a tenant. But before you hire a property manager, it’s important to know that not all property management costs are structured the same by every property management company. Ensure you understand how the property manager’s fees work; otherwise, you might sign a property management agreement that reduces your rental income profit more than necessary. Also, many property management companies will charge an early contract termination fee if you want to cancel, which can add even more costs to your bottom line. Learn more about your ad choices. Visit megaphone.fm/adchoices

Math is a vital component of real estate investing success. Understanding how your business makes money is imperative in helping it make more. To know how profitable your rental properties are, you’ll need to have a solid grasp on calculating rental property cash flow by using a rental property cash flow analysis. Let’s explore how to calculate cash flow and perform a cash flow analysis for your rental property so you can see where you can make more money. What is a Rental Property Cash Flow Analysis? To learn how to generate a positive cash flow, you need to ensure you’re doing an accurate rental property cash flow analysis. This means that you’re looking at all the numbers involved with owning a rental property to ensure that the property can make you money. You must look at the numbers over several months to understand the whole picture. Learn more about your ad choices. Visit megaphone.fm/adchoices

There has been a lot of discussion on BiggerPockets about whether it’s worth getting your broker’s license. Still, the question of whether to get your CCIM (Certified Commercial Investment Member) has been left mostly unanswered. I touched on what such a designation offers here, but it certainly isn’t for everyone. What is a CCIM Designation? A CCIM designation recognizes an individual is an expert in commercial real estate investing. Awarded by the CCIM Institute, formerly known as the Commercial Investment Real Estate Institute of the National Association of Realtors, the designation is recognized globally. The CCIM Institute educates CRE professionals. That is why most people with a CCIM designation are commercial real estate professionals locally and internationally. There are more than 50 CCIM chapters in local markets worldwide. Learn more about your ad choices. Visit megaphone.fm/adchoices

One of the most common questions people ask real estate agents is, “What credit score do you need to buy a house?” It’s a great question. Experian reports the average credit score in the U.S. is currently 714 as of 2021—and those numbers are steadily rising year over year. That’s a good credit score to buy a house, although by no means the lowest lenders will accept. With some lenders, you can take out a mortgage with a score as low as 620. But according to BadCredit.org, 16% of Americans have a credit score of less than 580. That means a huge chunk of individuals are unable to obtain a mortgage, thus, making buying a house or real estate investing a difficult task. However, many people don’t know that there are alternative loan options if you don’t meet the minimum credit score requirements. Learn more about your ad choices. Visit megaphone.fm/adchoices

Becoming a successful investor doesn’t happen overnight. It requires patience, hard work, and the ability to reassess following any mistakes. Reflecting on over a decade of investing in real estate, I’ve concluded that five things have been the most influential in my success to date. These five things will also likely continue to be essential during my lifelong career as a real estate investor. In less than 10 years of intentional investing, I was able to acquire an eight-figure investment portfolio that generates a net cash flow of more than $1 million per year. This was accomplished by adhering to these five core concepts below. I hope this helps you reach whatever investment goals you have in less time than you think! Learn more about your ad choices. Visit megaphone.fm/adchoices

The question of whether to trust one’s own gut or to painstakingly analyze any given problem has found different answers amongst different people and in different situations for centuries. On one hand, there is certainly such a thing as “paralysis by analysis.” I myself have seen numerous cases of wannabe real estate investors spend an enormous amount of time (and money) learning, only to never actually buy a property. You can even spot some “seminaraholics” at many events who have been to countless bootcamps and the like but have not locked down a single deal. Furthermore, as the famous saying goes, “time is money.” So even if a detailed analysis would yield a better result, it’s not necessarily the better course of action because the time spent on such analysis might not be worth the cost. But gunslingers who just go with their intuition have been known to make plenty of mistakes, including some very large ones. WeWork’s former CEO and certifiable nutjob Adam Neumann was able to convince SoftBank’s CEO Masayoshi Son to invest $4.4 billion in his wildly over-valued company during a 28-minute car ride to the airport. Needless to say, that gut decision didn’t play out too well. Learn more about your ad choices. Visit megaphone.fm/adchoices

To understand a reverse 1031 exchange, you should first make sure you know the ins and outs of a 1031 exchange. Key differences exist between a standard 1031 exchange and a reverse 1031 exchange, designed to defer taxes while investing in real estate. Read on to learn more about what it is (and how it differs from a 1031 exchange), how to complete one, and how it can benefit you. What Is a Reverse 1031 Exchange? A reverse 1031 exchange is a tax deferment strategy that allows real estate investors to purchase a second investment property before selling their relinquished investment property—and, importantly, defer capital gains taxes and other taxes that you would normally need to pay at the sale of a property. Because a reverse 1031 exchange is more complicated than a standard 1031 exchange, it’s important to understand it fully before proceeding. Learn more about your ad choices. Visit megaphone.fm/adchoices

Escrow is a key part of real estate transactions and mortgage agreements, but many homebuyers and homeowners aren’t familiar with escrow and how it works. Escrow protects homebuyers, sellers, homeowners, and even lenders with real estate-related financing—it supports those parties throughout the homeownership lifecycle. Let’s break down what escrow is, its role in real estate, and how it can be beneficial. Learn more about your ad choices. Visit megaphone.fm/adchoices

So, the day has come to finally figure out how much your rental property income will affect your child support payment. You won’t be surprised that many states consider that pretty penny a critical component when calculating these payments. As with any financial analysis, it’s essential to understand how to break down the numbers, especially regarding child support. In most cases, parental income is calculated in its entirety. You’re going to have to provide proof of all of your finances. For rental property owners, the court will pay particular attention to the total net income of your rental. So, how is rental income calculated, and how does that play into child support payments? We’ll give you the low-down on figuring out your rental income so that you can prepare yourself somewhat for the road ahead. Learn more about your ad choices. Visit megaphone.fm/adchoices

Custom building a home is a dream many homeowners share. Being able to design your home exactly to your preferences is an exciting but time-consuming endeavor. So, how long does it take to build a home? Building a custom home can take as little as a year to upwards of three years. The reason it’s so hard to nail down an average time estimate for completion? The average time for how long it takes to build a house can vary widely due to the scope of the project, weather-related delays, and how readily available supplies and labor are. Getting permits and completing inspections can also extend this timeline if those processes are difficult to schedule. Learn more about your ad choices. Visit megaphone.fm/adchoices

Did you know you can buy real estate using your IRA or 401(k)? Most real estate entrepreneurs are unaware of how easy it is to buy real estate with their retirement money. Welcome to the world of Real Estate IRAs. 1. What is a Real Estate IRA? A real estate IRA is a supercharged IRA that enables you to invest your retirement money directly into real estate such as multi-family, commercial, land, fix-and-flips, tax liens, and more. It has the same tax benefits as a regular IRA and can be set up as a Traditional, Roth, or SEP Real Estate IRA. A Real Estate IRA is also known as a Self-Directed IRA. Learn more about your ad choices. Visit megaphone.fm/adchoices

I’ve been investing in real estate since 2005, and to this day, I have yet to hear any other investor say, write or even hint at anything that resembles the following, “You know, I have this problem where I’m just budgeting too much for rehabs. I end up borrowing more than I need, and I’m probably missing out on deals because my rehab budgets are too large. I just always seem to come in under budget.” I’ve gotten better and better at hitting budgets since I started, but I still go over more often than I’d like to admit, and very rarely do I come in under. So, from what I’ve experienced (and heard about), mistakes are not made evenly in both directions when it comes to rehab budgets. We are biased heavily toward under-budgeting for rehab expenses. Indeed, we are biased toward under-budgeting in general. Learn more about your ad choices. Visit megaphone.fm/adchoices