August 03, 2014
Whether you are buying an investment property or buying a house for yourself, the foundation is the same. so this articles applies to all home buyers types.
To make sure I am not making any assumptions, your objective is to buy a house that you want at the lowest possible price.
To do that, first, stop DAYDREAMING. Stop listening to the scammers who claim you can buy for nothing and get the house for nothing! What kind of seller would be so stupid to sell you a house for nothing and how many of them will you actually run into. Even if you end up finding one, your Real Estate Agent would buy it before you do! In fact, with all these Real Estate Scams out there, if you bought a house at fair market value, then you have done very well.
This article is not about the secrets of buying a rental property for no money down and half the price of the market value of the house. I am not Tom Vu or Don Lapre and I am not in jail.
To clear the air, in Canada, the no money down home did use to exist, but not anymore. Some banks and lenders were willing to lend you the 5% down payment so that you don't have to pay a dime out of your own pockets to purchase a home. However, given the changes to the financial situation and the tighter lending restrictions, there are no bank or lenders who would do that in Canada or the United States.
The buying home for half price did use to exist as well. At one point, foreclosures (or called "Power of Sales", which is just a marketing gimmick) in Canada would allow foreclosed homes to be sold at rock bottom prices. The new law, which has been in placed for many years now require foreclosed properties be sold at the highest possible price or else the lenders will get sued. Cause of the naive belief of some buyers, sometimes foreclosed homes sell higher because Canadians have the misconception that foreclosed homes are a really good deal causing it to have a reverse affect.
Now, clearing out the quick money maker myths of buying homes, there are still many things you need to be aware of before starting.
If there exist ever an industry with more sneaky sales tactics and money motivated people, it has got to the Real Estate industry. As a buyer, you could be dishing out $350 000 and everyone wants a piece. The Real Estate Agents want a piece. The lenders want a piece. The lawyers want a piece and the sellers want piece. No wonder there are so many scams in this industry.
Your objective as a buyer is to get trustworthy people on your team. If you Real Estate Agent claims he knows everything and can get you houses at dirt cheap prices, then he is lying. If he could do that, why wouldn't he just buy it for himself. Don't bother looking for those who possess "Power of Sale" or sneaky ways of getting homes for half the market price. They don't exist in Canada! If a Real Estate Agent could do that for you, then the Real Estate wouldn't be a Real Estate Agent. He would become a buyer! Look for Real Estate agents whoe will work for less commission, not secret inside knowledge that God doesn't have.
And don't even listen to the Real Estate Agents who claim they are so rich that they are only working because they want to help new inexperience buyers. Just run when you hear that! If they really wanted to help, they can volunteer for other things and work for free.
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