What is a “No Money Down” deal?

No Money Down

A “No Money Down” Deal means funding a purchase of a property by spending little or no money of your own. This means that you have little or no capital invested in the property, which is ideal for property investors.

To structure a no money down deal you must be able to find different sources of finance for a deposit, mortgage, repairs, legal costs etc. The source of the funds can be from a combination of personal loans, credit cards, mortgages, remortgages, gifted deposits and so on. If you have sourced a BMV property then you can even structure a deal whereby you end up with a ‘cash back’ after the purchase. You will need a good credit record to be able to find finance from several sources over a short period of time.

Basics of a Commission-Based Property Management

Property Management

There are a lot of different types of property management that you can hire, and one of this is the so-called commission-based property management. Today, I will be explaining to you some of the basics about this kind of service, and the things that you can get from it. If you are going to read this article, you will be able to determine which type of service will be more beneficial for you, and will help you make a more educated decision.

When we say commission-based, the property management that you will be hiring will be the ones to manage the property that you have, and they will be responsible for collecting the rent. The amount that you will be receiving from them is the amount that was collected from the property minus the commission that both parties have agreed upon. For example, if you have agreed for a 10% commission and the property can generate $10,000 per month, then you will be receiving $9,000 per month.

Although the amount that you will be receiving from your property, you will be able to avoid most of the disadvantages that are associated with managing properties. This will help you save more time, and will allow you to focus in buying more properties that will allow you to make more money with your real estate. Aside from this, you won't have to worry about anything when it comes to maintaining the proper condition of your property, since they will be handling everything for you.

Commission-based property management could be one of the best services that you can get for your properties because you will only be paying them the percentage of the amount that you make. This means that you won't be forced to pay more than what your properties are earning, and will ensure that you won't be spending more than what you have allotted.

Although it is one of the best, hiring a commission-based property management service is more of a preferential decision. It doesn't mean that your property won't be profitable if you are not going to hire them, and it also doesn't mean that you need to hire them in order to make money. The choice depends on your preferences and the budget that you are expecting from the properties that you have. Just make sure that you will be hiring the best whenever you have decided to hire a commission-based property management.

Understanding Risk Management In Property Management

Property Management

If you are a Property Manager, then one of the most important areas of management that you need to understand is risk management. The owners of the real property that your business is based on are probably counting on you to be knowledgeable in this vitally important area. Risk management that is not handled properly can lead to huge expenses and possibly unexpected law suits.

There are three techniques to handle risk... Avoid, Control, and Transfer. These techniques can be symbolized by A.C.T. Let's discuss the first one.

Avoiding a risk is removing the potential for loss. If, for example, the tennis courts at an apartment complex are in need of repair, management could avoid the risk by removing the tennis courts and planting grass. This problem is solved.

Controlling risk is proactive and it's preparing for problems ahead of time. So, in the case of the tennis courts, the tennis courts could be resurfaced with a softer surface and first aid kits could be placed close-by. This would certainly solve the problem and might be an acceptable solution.

Transferring risk is moving the risk to another company. Let's say we contracted with an insurance company to cover any accidents that occurred on the tennis courts. This would transfer the risk to the insurance company.

Insurance companies can provide coverage for both tenants and property owners. Tenants can buy insurance to cover their own personal property. Owners of rental property can buy insurance to cover, fire, flooding, and liability. An owner can also purchase insurance to cover loss of rent in the event of an emergency which causes tenants to relocate while repairs are being made.

Of course, one can always use the ostrich "head-in-the-sand" technique of "retaining" risk and hope nothing will ever happen. But, it's the Property Manager's duty to help property owners identify risks. And, this is relatively easy to do. Just follow the advice of the great philosopher Yogi Berra... "You can observe a lot just by watching."

Property Managers need to also assess the risk that their own business is being subjected to. Remember, you are an in-between-man... between the tenant and the property owner. Either one of these parties could file suit against you and/or your company. So, be sure you cover this risk.

Being a Property Manager is a thankless job. Tenants and property owners rarely give praise. But, if property management is your job, keep your head "out-of-the-sand" and properly manage the risk.