Prospect Group buys properties across Southern California. They work with an elite group of agents who bring them deals, represent them in buying the property, and eventually when it is fixed and they also represent Prospect Group as a listing agent in the sale of said property.

Meet some of their favorite agents who are real estate industry royalty who continue to work with Prospect Group year after year.

• Gary Richardson | Strand Hill Co-Founder | Christie’s International Real Estate
• Teresa Fuller | Compass Real Estate
• Olga Safonoff | Pinnacle Estate Properties, Inc.
• Bruce Jay | Bruce Jay Associates Real Estate
• Carol Gillie | Compass Real Estate

Realtors often ask: how to work with an investment company and make more money.

We talked to PG acquisition and investment specialist Greg Davtyan who gave us some useful tips for getting started.

Greg Davtyan says anyone can bring Prospect Group a deal. He has three tips.

 1.Be Smart About Exit Value

Realtors must be able to put themselves in an investor’s shoes and do their diligence about the market and the trends. At Prospect Group, they take into account the everchanging construction and contractor costs when considering exit value. It’s the job of the acquisition specialists to make sure that the offer that they provide a realtor is an offer on which they can perform.

 2.Use Data

Use data to help make your case for pricing when working with investors or companies like Prospect Group. There are a lot of realtors who work with PG and make a lot of money. The level of success has everything to do with how efficient the realtor is with the type of deals they offer, the type of background work they’ve done on the deal, and the effort they put in to analyze the deal before sending it out to the realtor. Greg says we know who has done their homework and are more likely to work with them.

 3.Know How to Run Comps 

A realtor must know their numbers. There’s no one formula. Every property is unique to itself. Consider what the property needs, the condition it’s in, and the market itself. Know how to analyze a specific area and what a property should really go for at exact square footage with or without a pool. Every area is unique in its own kind of pocket, so agents really need to do their due diligence based off of which area they serve – not just based on zip code based on the neighborhood.

Greg says, “I don’t expect agents to know exactly what I’m going to spend on the property, or I’m not going to expect them to know exactly where we have to be price-wise, but I would like to know that they have a general idea of where I would have to be because that would show me that they can actually guide their sellers to take my offer.”

Greg says, there is money to be made, “if you’re a realtor and your niche is not selling luxury properties. Then you can make your niche the beaten down properties. If you market to and get properties that need a lot of work – that would make Prospect Group your permanent client.

If you want to contact us write us at contact@prospectgroup.net or prospectgroup.net/realtor

For the full conversation with Greg Davtyan see below:

Silva  [00:00:00] Hello, everybody, I am Silva. Welcome to Prospect Group. This is the channel where we talk about investing, real estate, and how to make you lots of money. Sorry, my eye-line just changed because there’s somebody on the roof across the street. I can see out the window. All the things that you don’t expect to see here. We’re on YouTube. We’re on a podcast. Make sure to check us out on one of those channels. Today, we’re going to talk about real estate tips, specifically how realtors and agents can sell to investors because we’re an investment company. So with me today is Greg. He is our acquisition and investment property specialist. I think I butchered your title.

Greg [00:00:45] Investment specialist.

Silva [00:00:47] Investment specialist. Thank you for correcting me. The title isn’t as important as his knowledge about investing and the depth of relationships he has with agents and realtors across Southern California that continue to bring him deals. So, he knows a thing or two about what it takes to work with us. And, there are quite a number of realtors that consistently send you deals, and sometimes they’re all deals and we call them pretty quickly and sometimes they’re not until they are. Right. So if we have a realtor out there or an agent who is interested in working with us, what is the best way they can go about doing that? But before you answer that question, make sure you subscribe to this channel. All right. Go ahead.

Greg [00:01:41] Well, a couple of things. I mean. Just be smart. One thing.

Silva [00:01:48] One thing. Just be smart. What does that mean?

Greg [00:01:50] That’s it.

Silva [00:01:52] What does that mean? What does that mean? Be smart.

Greg [00:01:56] What does that mean? That means put yourself in an investor’s shoes. I think so many real, real estate agents are not able to plug themselves into an investor’s shoes even though they’re in the industry.

Silva [00:02:09] Hmm.

Greg [00:02:11] They are not able to plug themselves into another perspective, and they don’t use data to help themselves get on the good side with investors or companies like us that would have me want to keep them close to me and constantly bring us like a flow of deals, you know? You know, we pick and choose who we want to work with, you know, because there’s a lot of realtors that can waste their time. There’s a lot of realtors that we enjoy working with. There’s a lot of realtors we do work with, you know, make a lot of money with. So it really depends on, you know, how efficient the realtor is with the type of deals they send us and, you know, with the type of background, you know, the effort they put to pretty much analyze the deal before sending anything out to us. You know, we stay busy, so I don’t want to just win any deal. When I run something, I want something to be at least close, even if it’s not on target. Yeah. Based off the crazy market. It’s been tough for a lot of realtors to bring us deals, you know.

Silva [00:03:30] Because they’re selling deals on the market, you know, to the end consumer with multiple offers and over asking. Right. But really, I want to break this down a little bit because there’s multiple things that I think happen, right? There are those who are just focused on that one deal and they may lose sight of the fact that this may be one deal, but this investment company is in the business of buying, which means if I figure out a way to make this deal work and this these other deals work, I can increase my volumes significantly because this investment company is buying. Right?

Greg [00:04:24] You know, that’s that’s the part that’s kind of crazy to me. You know, sometimes they don’t have a choice. Sometimes the sellers really just want to take the higher offer.

Silva [00:04:33] Right.

Greg [00:04:34] But it’s also up to the realtor on how much they’re able to really impact the decision that their seller makes.

Silva [00:04:47] With data. Right. We’re not we’re not saying with supported data to say.

Greg [00:04:52] Exactly.

Silva [00:04:52] Because I’ve seen you guys work. So I want to be clear about this. I’ve seen the acquisition team work. They they they really do do their due diligence. Right. You guys spent hours on comping a house. You take it. I asked you yesterday about some specifics about a comp. And you said everything… it has nothing to do with just numbers and it has to do with the square footage has to do with how much work it needs. It has to do with the foundation, has to do with the driveway, has to do with when when was a kitchen updated? There’s so many moving parts that actually impact the price of a property that you can’t just look at it just there’s no there’s no one formula.

Greg [00:05:35] No, there’s no one formula. You know, every property is unique to itself. So, you know, the stuff it needs, the condition it’s in, you know, there’s so many different factors to a property, whereas you can’t just take one and take another has the same. So I mean, we don’t expect, I don’t expect agents to know exactly what I’m going to spend on the property if they get, you know, if they send me a deal. Right. Or I’m not going to expect them to know exactly where we have to be price wise. But, I would like to know that they have a general idea of where I would have to be, because that would show me that they can actually guide their sellers to take my offer. Right. But if they don’t understand my positioning and why we have to be where we have to be, then how is that seller going to understand, you know, because they’re being guided by that agent.

Silva [00:06:27] Right?

Greg [00:06:27] So my whole thing is having agents understand, you know, the true data statistics costs, right? Updated costs, because we are in, you know, the line of work every single day working with contractors day in and day out. Our project management team constantly gives us updated cost,  and that’s my specialty. I have to crank in all the numbers and I have to make sure I know all the numbers constantly, you know, and make sure the offers that we provide agents or offers that we know we could perform at because we don’t like to make agents look bad. When we you know, when we give an offer, we want to make sure we can perform. Whereas, you know, that agent will have credibility with that seller and hopefully be referred to other clients. And you know, those other clients could be potential sellers and we could be the potential buyer. So those other product.

Silva [00:07:15] And that’s part of our core values here at Prospect Group and it’s part of our integrity is when we put an offer in, we have crunched our numbers and we know that at this at this rate, with this with these combination of things, we can actually perform. Right? Because there’s nothing that makes an investment company look bad more than not being able to actually perform on a deal. Yeah.

Greg [00:07:41] Realtors just really need to kind of just do their due diligence when it comes to just like, running their own numbers, learning that because a lot of things can be learned, you know.

Silva [00:07:52] How do we help them? This is ultimately the the point of these series is to help them make more money. And one of the ways we can help them make money is by letting them know that they can bring us deals that we’re buying, right? But before you do that, here’s what you need to know.

Greg [00:08:14] The biggest thing they need to know, learn comping, learn how to analyze a specific area and what a property should really go for at an exact square footage with or without a pool. Every area is unique to its own kind of pocket, so agents really need to do their due diligence based off of which area they serve so that they can actually know, hey, a 2000 square foot property for an investor per se. Would probably be a buy at 1.4 million. Based off this, this, this.

Silva [00:08:53] And this specific neighborhood, for example.

Greg [00:08:55] Specific neighborhood.

Silva [00:08:56] Right.

Greg [00:08:57] Right. And it’s not it’s not it’s not a Zillow type of, you know, that to take in, you know, in one whole zip code where different pockets can weigh differently. So you have to, you know, focus on one specific area. And based off that, you can do marketing and then you can have those people you’re marketing to, expecting a price that you can actually deliver on, you know, because a lot of agents try to get listings based off of all these ludicrous numbers that they, you know, tell a sellers that they can sell it. Then when they get the listing, they’re not able to do that. And then guess what? They lose it and that person goes to somebody else and then that somebody else is able to explain to them why they should take, per se, not 3 million, but 2.6 million. Right. And then because of that, they get the listing.

Silva [00:09:48] Right.

Greg [00:09:49] And they’re able to make, you know, their commission. And you’re not. Yeah. So that’s what it comes down to, really doing your research.

Silva [00:09:57] I’m going to toot our horn a little bit and say that we are really good at working with agents. I’ve heard you guys spend time explaining all of this to them. So our door is always open. We always welcome agents calling us and connecting them with 1 to 1 of you guys and acquisition managers and experts. And you can look at a property, you can look at the square footage and the condition of the property, and you can you usually give them a pretty good assessment as to this is what we can pay for it and here’s why and here’s how you can explain it to the seller, and if you can make that happen, we’re ready to to make this work.

Greg [00:10:41] A lot of people, they do go going back to, you know, that thought process of them not looking long term when it comes to business. It’s because I think a lot of agents are at that point where they feel like it will happen, like longevity-wise.

Silva [00:10:59] Longevity-wise. Yeah.

Greg [00:11:01] A lot of people in business, just not in real estate, but they don’t really believe in themselves. They don’t really believe they’re going to stay in an industry for so long. So that non-belief factor causes them to just think about the now. They don’t even think, hey, if I really work with this guy, because a lot of offers we go against that, investment companies go against are retail buyer offers. Right. And a lot of them consist of a loan.

Silva [00:11:33] Right — end user.

Greg [00:11:33] User. Yes. And and just because you know, just because some buyer has a preapproval letter, that does not mean they’re guaranteed, you know, to be approved during the underwriting process. Right. So things can still fall through.

Silva [00:11:47] Or that it will pass inspection or that all the contingencies will be removed.

Greg [00:11:53] Or if it doesn’t appraise and if they’re able to pay that sum of cost. So, there’s different factors and there’s a lot of risk associated with taking that. That’s why a lot of people do come to us at times. Right. And takes, you know, let’s just say more of a sure thing. Yeah, right. Not a guarantee, but more of a sure thing. And, you know, we make it easy for for sellers and we make it easy for agents, you know, because we have an amazing staff team and we have, you know, a structured, you know, organization that’s able to provide, in a company to whatever tasks are needed in escrow.

Silva [00:12:28] Yeah.

Greg [00:12:29] Not just leaving it on, you know, the responsibility of the seller. So selling sellers agent but you know, we try to help them with the process of getting things complete when it comes to the transaction. So we try to make it a quick process for them. So we make sure that, you know, they’re not left in the open. They know, how we work and we make sure that we work with agents that are very transparent, honest. They do good work, they’re not trying to beat around the bush and do weird stuff. You know, we keep it transparent with them.

Silva [00:13:00] In reality, we buy properties for cash sometimes pretty quickly and have historically helped a lot of people out because there’s people that, you know, want to sell their property and get out of it. Sometimes they don’t even want to move their stuff. They don’t want to make any updates. They don’t want to, you know, do any any, you know, outdoor gardening work. They don’t want to cut the tree down. They don’t want to, you know, move, remove the carpet. They don’t want to spend another dime on that property. They want to sell it and be out of it for whatever reason. And this is a good way for a realtor to know that this is a property that’s good for an investor. Because the end user will have to spend that money, will have to spend the time to do the remodeling, to do the upgrades, to do the repairs, and also haul out all that trash and all everything else that’s associated with it. The property is in market when it’s in that condition. Right. So if you’re a realtor and you have a property that’s not going to market well to the end user, you may want to consider potentially, you know, connecting with a real estate company and a company like us that is reputable, you know, might be your bread and butter because if you bring this a good deal, can continue to bring us good deals.

Greg [00:14:23] I think we’re the best partner to realtors. Yeah. Who are not so after just luxury listings. Yeah. But for those realtors who are able to market to and work properties, you know, in the condition that needs work.

Silva [00:14:39] Yeah.

Greg [00:14:39] And, you know, if you’re a realtor and your niche is not selling luxury properties. Then you can make your niche to be marketing to and getting beaten down properties and coming to us as your permanent client.

Silva [00:14:55] And you can do volume.

Greg [00:14:56] And you can do heavy volume because we do close about a dozen a month, if not more. Right. So we’re we’re constantly buying on a heavy basis. We’re constantly working on properties, you know, and flipping them and having agents. A lot of times relist these properties and find a nice buyer for them. So we try to do what we can to be fair to agents and to motivate them and to really teach them how we work, how we look at things, and what they should look after when they send us stuff. Yeah, just so it’s more of like a partnership and not as much of, you know, you’re an agent. I’m an investor. You know, you have your role, I have mine. It’s more as, you know, let’s collaborate, let’s talk about things, let’s discuss them and why things are the way they are. Yeah. And go back to your client and try to guide them the right way. Because a lot of times, you know, new realtors especially, you know, sometimes aren’t given the heads up on like how they should really explain things to clients.

Silva [00:15:55] This has been really informative and really good. I hope it was helpful to realtors that are watching and agents and anyone who wants to, you know, get educated on how the industry works. I think it’s all really great information. But that said, make sure you subscribe, make sure you like, and comment for more information and some breakdown of the conversation we had, take a look below this video. If you’re listening to us on a podcast, check us out on YouTube and subscribe to us as well. Thank you. Thank you. A wealth of information. I’m Silva. This Prospect Group. See you next time.

The post How Real Estate Agents Can Sell to Investors and Make Millions appeared first on Prospect Group.

If you are in the real estate industry, you already know it’s hard work. Whether you’re a realtor, an investor or a wholesaler, having longevity in the real estate business requires consistency even when things aren’t working out in your favor.

We wanted to know, what does it take to create momentum and be successful in the real estate industry?

Greg Davtyan is a property acquisition and investment specialist with the Prospect Group. They buy mostly off-market fixers, they buy homes for cash fast in Southern California. Davtyan has worked in finance, he’s been a realtor and now works in investments and acquisitions.

He says, it takes a lot of discipline and a lot of hunger.

“I think if you don’t have that hunger to create a life that provides you to live on your own terms, or if you don’t have kind of like your belief on why you’re doing what you’re doing, then it’s going to be hard for you to do everything day in and day out with everything that real estate consists of, which is a lot.”

A lot of realtors – especially those who are new to the industry – think that real estate is what they watch on HGTV or the glamorous life they see on social media. But that’s not the case. There is a lot that goes into transactions, negotiations, calculation of numbers.

Watching an agent selling three, four or five million dollar homes is inspiring. Many who are new to the industry think they too can do that immediately, but what they don’t see is the amount of work that realtors put in to get to that point.

Here are some tips to keep you moving forward on your path to success.

Positive Mindset/Find Your Purpose

Identify what it is about real estate that you like. Get your mentality and beliefs in sync with each other on why you’re doing what they’re doing. What is your mission, dream, and goal working in real estate? Finding the answers will help you push through the tough days.

Know your numbers

A successful person who is in the real estate industry must understand the numbers and how much they impact a deal. Know how to run comps well so that you can set realistic expectations whether you’re representing a seller, a buyer or working with an investor.

Be Patient

It’ll be hard in the beginning. Keep doing the work. Focus on progress not perfection.

Real Estate professionals who are looking to grow their business and scale can partner with investment professionals such as Prospect Group to sell house for cash fast. Davtyan says, to be successful in a partnership with an investor, it requires persistence. Not every deal that you pitch will work out and that’s OK. The key is to continue to stay motivated and to continue to pitch off-market and listed fixers.

If you are interested in learning about how to work with Prospect Group or Greg Davtyan, contact us at contact@prospectgroup.net.

A CONVERSATION WITH GREG DAVTYAN

SIlva [00:00:00] Hello, everybody, I am Silva. Welcome to Prospect Group where we talk about real estate and investments and how we can help you make more money. Because who doesn’t want to make more money? Everybody wants to make more money. Everyone. Today we have Greg Davtyan with us. He is a property acquisition and investment specialist. He’s also a realtor. He’s been with Prospect Group for some time. He’s an expert in what he does and how he runs numbers. I’ve seen him do it. It’s pretty impressive. Today’s topic, we’re actually going to talk about REAL ESTATE FOR BEGINNERS and potentially those who want to get into real estate and realtors specifically because I think he has a unique perspective and understanding on all sides of the coin of real estate in the industry. But before we get started, Subscribe. Comment. Like. Share this video with your friends because we want to offer you as much value as possible. So thank you for Greg making time with us.

Greg [00:01:00] Thank you for doing this for us.

SIlva [00:01:01] The truth is, I had to bend his ear a few times to get him here.

Greg [00:01:04] It’s taking some time.

SIlva [00:01:05] Yeah. You really good at sharing information, but I don’t know why it’s so challenging to.

Greg [00:01:14] Not as much so on camera, maybe.

SIlva [00:01:16] Yeah, maybe.

Greg [00:01:17] More so in person.

SIlva [00:01:20] We’re going to pretend like the cameras aren’t here.

Greg [00:01:22] Pretend. I’m gonna try.

SIlva [00:01:23] Try. Yeah, I know. It’s kind of hard to do.

Greg [00:01:25] I’m gonna try, It’s a lot.

SIlva [00:01:26] The way part of the reason why we started this year with the team is because we want to offer value to everyone out there within the real estate industry. And then we’re having all types of people within their expertise talking about things. I wanted you on because you have a unique perspective on being a realtor, working as a realtor, and also being an acquisition. And you work with realtors a lot. So I want to see if we can bridge the gap and maybe talk about some of the things that are a must know, a must-do for those who are beginning and want to actually have some momentum in this business and set them apart. Can we do that? Sure. Awesome. So let’s start with what does it take to be successful in this industry?

Greg [00:02:13] It takes a lot of discipline and a lot of hunger. I think if you don’t have that hunger to create a life that provides you to live on your own terms, or if you don’t have kind of like your belief on why you’re doing what you’re doing, then it’s going to be hard for you to do everything day in and day out with everything that real estate consists of, which is a lot. And people think it’s all HGTV and, you know, rainbows and butterflies and, you know, all that showboating. But when it comes down to it, there’s a lot that goes into transactions. There’s a lot that goes into negotiations, there’s a lot that goes into, you know, the calculation of numbers. And it’s fascinating how, you know, numbers tie into our daily lives and how much of an impact, you know, real estate can make if you really just focus on, you know, progress and not perfection. And I think a lot of agents who come in new to the industry just focus on trying to be perfect because of what they see out there, including social media channels and Instagram. And, you know, all that they see on TV, they see all these agents selling to three or four or 5 million homes. And, you know, out of the bat, they think that they should be doing that. But, they don’t see like all the work that those agents have to put to get to that point. So I think focusing on progress and not perfection was tough for me in the first two years coming into the industry because I am impatient. I do like to get things done quick and when I wasn’t able to get results quick, it was kind of like a aha moment, like what do I do next?

SIlva [00:03:57] It’s really demoralizing, right? Especially in the realtor side when because you work on commission, right? You put all this work in and all this effort in and then, you know, sometimes it falls apart.

Greg [00:04:11] So a lot of times, a lot.

SIlva [00:04:12] A lot of times it falls apart or the numbers don’t work out or something happens. The buyer changed their minds. The seller changes their mind, things fall out of escrow and to continuously, you know, do the work without immediate gratification, which is where we live nowadays…

Greg [00:04:28] Yeah. As you know Vartan being my mentor when I came into the industry, said, this is a tough industry, so I don’t know if you want to really transition into it. I already come from a difficult industry, as is when it comes to just the lifestyle and everything, you know, having been a corporate accountant. So it was grueling hours. So that’s why I was willing to make that jump because I knew I can dedicate time into what I like doing. And I realized, well, what I like doing real estate had more of than the other careers I was doing. So for many people that just have to really. Identify what it is about real estate that they like. And and they have to pretty much, you know, get their mentality and their beliefs in sync with each other on why they’re doing what they’re doing, what their mission is, what their dream is, what their real goals are in real estate. Because a lot of people are just in it and they’re just in it to make one sale here, one sale there, and make a commission here, make commission there. But if you’re in it just to make a commission here and there, you’re not really going to make a career out of it. So I think if someone wants to make a career out of something, it takes a lot of time and it takes a lot of discipline.

SIlva [00:05:38] This is so interesting because when I was thinking about the topic and when I actually threw it out, even when I was doing the introduction, I did not think that this conversation was going to go in the mindset space. And I think that’s true for everyone who thinks of real estate, because real estate is so transactional that you automatically think that if we’re going to give some tips and have conversations about how to help realtors who are just beginning to be successful right and to help them make more money, it’s not transactional help that you need. Right.

Greg [00:06:19] And it’s not as skill — sorry to cut you off — but it’s not as much skill as much it is mentality.

SIlva [00:06:25] Okay. Talk to me about that some more.

Greg [00:06:27] A lot of agents have the skill. A lot of a lot of agents are friendly. A lot of agents like to be helpful. You know, a lot of agents are sweet. A lot of agents are really social, you know. But there’s also a lot of them that are all those, you know, characteristics that I mentioned, but at the same time, they’re not making any sales. So for me, you know, I’m not a popular realtor. I’m not I’m not I’m not an agent that’s, you know, representing many people. I’m on the investment side. So my, my my niche is pretty much finding investment deals for us. Right. And, you know, sometimes for other investors out there who are looking for something that we could wholesale out to them if it’s not a deal for us. But, you know, what I see from realtors is that, you know, I mean, I work with a lot of realtors who bring me properties, as you know, you know, we get a lot of deals off-market. You know, a lot of realtors bring me listings that, you know, they have, you know, or colleagues have. And a lot of times if they don’t work out, I realize they lose a lot of drive and they don’t continue sending me properties. I realize the ones that are good agents and the agents that do make money and the agents that have made real estate their career are constantly sending me properties, even if one doesn’t work out. So what does that say? You know, when one doesn’t work out, many others can in the future. And a lot of people don’t have that mentality because they think it’s either now or never. And that blocks it from you know, it prevents them from making future money. And I think if people have that long term mentality instead of that now-mentality, a lot of more money can be made by them. So, you know, that’s what I try to do. There’s been a lot of agents that have pushed me properties throughout the years. And, you know, there’s there’s agents I’ve known for three, four or five years. And there’s there’s one that we didn’t do a deal for with for like two, three years. And we just did a deal.

SIlva [00:08:24] And they kept sending you properties. Yeah. So you have to have, I think this is the reason why almost every agent that I know or every realtor that I know invests a lot of time and money and effort in coaching and self-development because you really have to have your energy up and your morals up in your motivation up and you consistently have to be inspired and motivated to continue to move at the same pace. Even if you were not closing a deal, even if this one didn’t work out, even if that person said no, even if. Right.

Greg [00:09:07] Yeah. And you know, you know, when you really know what pushes you is when it’s not when you get a deal and you’re happy, it’s when things aren’t working out for you and you keep getting struck out. And it’s that thing you think about that keeps you going that is really your passion, that’s really your calling, you know, like when things don’t work out, I just keep doing things because I enjoy making deals, work and finding deals and crunching numbers and based off its unique characteristics, you know, creating an analysis and, and, and having our company buy, you know, a house based off of that analyzation. And then, you know, months later, seeing the product and seeing a family moving into it and knowing that it was all based off of the numbers I plugged away with.

SIlva [00:10:00] Like the houses you see right here. I mean, these are all the properties that we’ve bought and renovated, and some are better quality pictures than others, but. Yeah.

Greg [00:10:11] And there’s a lot of stories I, you know, goes into obviously family moving in there and, you know, all the.

SIlva [00:10:17] So it’s the process that that you enjoy very much more than, you know, the the end result which keeps you coming back and hungry all the time and every time.

Greg [00:10:29] Yeah, I mean, the process is super sweet, you know, because realtors really come into the industry sometimes because they just want to make some money, which is totally okay. I came into the industry because I knew there was more opportunity to make more money, but then I tried to find, what about the industry is it that kind of sparks me to do more than an average person that specializes in investments per se?

SIlva [00:10:52] Yeah.

Greg [00:10:52] You know, so realtors have to really think about like what sparks them to be better than another agent to go above and beyond to do what other agents do for their clients. And everyone wants to do the same things, but they all want to stand out. So it’s like, what’s going to set you apart, you know, if you’re doing the same exact thing as the other person. Yeah. And what’s going to make you unique, you know, and it and I just don’t get that, thought process. Yeah. And a lot of people just stay stagnant on that.

SIlva [00:11:21] Yeah. And also it’s, it, it takes incredible amount of self-reflection and some internal work by the realtor and the agent to really, truly get to the bottom of the thing that sparks you within the industry is the thing that is going to set you apart truly and it’s going to show. So, you know, lean into that and continue to evolve in that space.

Greg [00:11:48] So yeah. And besides a mentality, as much as mentality is important, skill is too. So some people have the skill and they just don’t have the mentality and some people have the mentality and they just don’t develop the skill. So I think doing both is just as important, working on both and you know, so some people are just, you know, not equipped with the knowledge to per se persuade sellers — sellers to expect less per say when they when they’re selling their property. And that’s the reason why, you know, we see a lot of listings at times that are stagnant for months. And that’s the reason why we see a lot of new agents lose a lot of possible listings they could get is because they’re not able to analyze why, you know, that seller should expect less for their home per se, you know, and they don’t generate any credible information to provide them so that they could be comfortable in the decision they make and being okay with taking less. That’s where I come in. I try to give my input and my two cents to agents to make it easier for them to pretty much make transactions happen because a lot of times things just stay stagnate. And I go in with information that they can provide to the seller and sometimes things just end up working out. And that’s how we get a lot of deals to us. Yeah. Um, so there’s no secret, it’s just really working deals and putting the time and energy and a lot of realtors slash investors, slash wholesalers, people of all spectrums and real estate try to avoid the work, but there’s no skipping it. You just have to do it.

SIlva [00:13:30] And with that, there’s no avoiding the work. You just have to do it. There’s no there is no shortcut to anything. None. Social media like us likes that likes to have us believe that there is some, you know, pill you can take and be successful and do everything. No, there is no shortcut. Just do the work. Do the work, do the work. Do the work. We’re here to help you do the work and help you make money. Subscribe, like, and comment. Come back for the next episode. If you’re listening to us, check us out on YouTube. If you’re watching on YouTube, guess what? You can listen to us when you’re walking to because we’re driving because we’re on a podcast. So check us out. We’ll see you next time.

The post Real Estate For Beginners in Southern California appeared first on Prospect Group.

With the news of The Federal Reserve raising interest rates, there have been many speculations about the direction of the housing market. The 0.75% increase in June was the largest rate hike since 2013.

Changing interest rates affect numerous aspects of real estate.

1. Price of your new home
2. Availability of capital
3. Demand for investment

This capital flows impact the supply and demand for property and, as a result, they affect property prices.

When The Fed increases discount rates it affects short-term borrowing rates. While it doesn’t directly affect mortgage rates, it changes the outlook of what is going to happen in the market. So, the long-term 30-year mortgage market reacts pushing rates up at a very fast pace.

Price of Your New Home 

Theoretically, home prices should change when mortgage rates increase as buyers have less borrowing power. For example, in January of 2022, an 800K loan with the rates of about 3% would have had a 3.5K monthly payment. With the rate increase in June 2022, to keep the same 3.5K monthly payment, a borrower would only quality for a 580K loan. Even so, as of late June, home prices have stayed the same. In Southern California, real estate values are greatly influenced by the supply and demand for properties.

Availability of Capital 

Although interest rates affect the supply and demand for capital, demand is still high because there is a significant lack of inventory and a housing shortage across the country, especially in Southern California. Many are willing to pay higher monthly mortgage payments for the chance at home ownership.

Demand for Investment

Interest rates also affect the availability of capital and the demand for investment. Demand for investors is determined by investor valuation which in turn should impact real estate prices. Most investors look for cash flow. The valuation starts by forecasting property income and anticipated lease payments. However, low inventory in the housing market has driven rents even higher helping investors with their valuation – keeping demand high and home prices even higher.

Will home prices take a hit with the rising interest rates?

Diving even deeper into interest rates and how they impact the real estate market, we speak to lending expert Artin Babayan with the Babayan Group and PrimeLending.

Silva [00:00:00] Hello. I’m Silva. Welcome to Prospect Group, where we talk about real estate investing and everything that’s happening in the market. And I am so pleased today. Joining us is Artin Babayan with Prime Lending. He is one of our go-to guys when it comes to lending and understanding the climate and what’s happening with interest rates. And everyone I know is running around like their hair is on fire because we just had interest rates go up significantly this week.

Artin [00:00:28] Yeah.

Silva [00:00:29] Talk to me about that.

Artin [00:00:29] That. Well, it’s been wild, these past couple of weeks have been crazy. So the latest thing is the Fed came out and raised the rates by three-quarters of a percent on Wednesday. And even before that, the market on Monday essentially had a panic attack, thinking, oh, the Fed’s going to raise the rates. What’s it going to do? Is it going to keep raising the rates at this velocity? Is it going to keep doing that? So you saw the worst day for interest rates since 2013 on Monday of this week. So before the Fed even spoke.

Silva [00:01:03] Wow. And that was three-quarters of a raise?

Artin [00:01:07] Yeah. And the discount rate.

Silva [00:01:11] When was the last time we saw that? That much of a raise in the rate?

Artin [00:01:16] That much of a raising rate? It’s been a while. As far as I can remember…so I’ve been doing this since 2006. So that’s when I got into lending and started and was working as an intern back even at Countrywide when that was the thing. And back when I started, it was at eight and a quarter, 2006. And since then I saw it just dip, dip, dip all the way down as the market tanked, as all these kinds of things happened. When the recovery was in full effect, we saw the rates start rising up, and then The Pandemic hit and they went back down. And so now we’ve just been now we’re back in a place. But last time they were going up, it was about a quarter of a percent at a time, which is traditionally what it is.

Silva [00:01:56] A quarter of a percent at a time is what we’re used to. Yeah, three-quarters of a percent is.

Artin [00:02:02] It’s a big jump.

Silva [00:02:03] It’s a big jump. So what has been what would have been what have you been hearing? Because this is your world. This is your wheelhouse, your boots on the ground, talking to people. We read a lot of articles and a lot of content and there’s a lot of noise and a lot of conflicting information. Can you set the record straight? What is happening?

Artin [00:02:22] This is my personal belief. So there’s a lot of talk, there’s a lot of different articles and people talking about it. But I think what’s happening is that the Fed is trying to push us into a recession. They saw crazy inflation. They saw things going up so fast. So by pushing up the rates, they edged that off. And now we will see probably things starting to level off and then start coming down. And then they’ll lower rates, the kind of bougie that, and find some kind of equilibrium there. That’s what I think the grand scheme is and that’s what’s going on behind the scenes or that’s what the whole point of all this is. That being said, what it’s doing to people is that it’s changed, it’s increasing the cost of everything from credit cards to mortgages to car loans to any kind of financing. This is the underlying thing. So what the Fed plays with is the discount rate, which affects short-term borrowing rates. So it doesn’t directly change mortgage rates. But what happens is when the Fed changes, when the Fed ups the rate, it changes the outlook of like what’s going to happen with the market. And so then our long-term rates, mortgage, 30-year rates react to that. And so what we’re seeing is that the Fed is raising the rate, pushing mortgage rates up. And now to give you an end and it’s at a very, very fast pace, which to give you an idea, like in January of this year, if you got to 800,000, roughly about $800,000 loan, with the rates being right around 3%, the payment would have been around $3,500. Now it’s $580,000, that’s like with today’s rates.

Silva [00:03:56] It’s what?

Artin [00:03:56] $580,000. If you borrowed $580,000 today, that payment would be roughly about $3,500.

Silva [00:04:04] So what you’re saying is, if I could earlier in January, I could if I could afford to pay $3,500 a month, I would have been able to afford an $800,000 house loan or loan. Right. And today, based on where we are, I could only afford a $580,000 home.

Artin [00:04:22] Yeah.

Silva [00:04:23] Wow. That is a huge difference considering the market and home prices here in Southern California.

Artin [00:04:31] So it’s a huge difference. And what’s shocking is at least now and so everything is so quickly right now. But as of right now, the prices, I mean, we are starting to see price reductions right now like as we speak, but it hasn’t really dropped that much. It’s not like the market has dropped to adjust for that. There’s still, I think, a lot of demand and I think what’s keeping the market prices up so high is like a lack of inventory. But what I think is happening, what’s going to happen is that somewhere there needs to be an adjustment. It’s the rates can’t keep going up like this and the prices still stay the same. Something’s got to give one way or another.

Silva [00:05:08] I think that’s where the confusion is and conflicting information, because people are looking at graphs and information and you’re like, yeah, so the rates are going up. Theoretically, it should slow things down and impact the housing market and home prices, but in reality, it hasn’t really moved that much. There’s been a little bit of turbulence, but there hasn’t been a big dip at all. So I think the inventory element of Southern California housing might have something to do with that, as you just said. But. So you said they raise rates to push us into recession, to level things off. And at some point, they’re going to find that equilibrium.

Artin [00:05:47] They’re going to lower rates to find that equilibrium.

Silva [00:05:48] And they’re going to. Right. Do we have an idea or anticipation of how long that gap is between when things go up and up and up and into recession to when we balance out?

Artin [00:06:03] Well, I think that’s the million-dollar question because we see that we’ve seen versions of this play out over U.S. history. I think in the seventies, there was this called stagflation where interest rates are going up. But the economy was stagnant. They were trying to basically. But what typically happens and I think this that history doesn’t repeat, but it rhymes. So we’re seeing a different version of things playing out where they’re taking it, lessons from the past, and trying to apply it to today’s date to combat inflation. And so the question is like, this is what’s going to happen. This is how this works. But the timing really comes down to some of the different factors that it’s almost like you won’t know until that day shows up. Whereas as the narrative changes, because we’re not there yet, we don’t know it’s we’re not in a place where we’re even talking about going back down now we’re talking about recession is coming. So now we’ve got to get the recession. Then we’ve got to see what’s going to happen there before we make that next job.

Silva [00:06:59] How does that impact your industry?

Artin [00:07:02] Well, the interest rates going up just kind of like last year between last year and now, the mortgage applications have plummeted. I don’t know. I want to say it’s more than 50%, but refinances are pretty much gone. There are not that many people refinancing. So, generally, speaking to me as a residential mortgage lender, I do refinances, and purchases, and those are primarily the kind of loans I do. The purpose of the loan, is you’re taking money out or refinancing the loan or buy a property so people refinancing their property just to lower the rate that doesn’t exist anymore. There’s no reason to do that because everyone who has gotten a loan has a lower rate than what it’s been now, people pulling money out of the property. I’m spending a lot of time talking them out of refinancing a loan and helping them get second mortgages because it’s a cheaper way to take money out than changing out the whole first loan. So you saw pretty much half or like a half of the ways in which applications that are received just go away. So now purchase loans are still there and so people are still buying. I’m still busy with purchasing loans and it’s almost when I was looking at last year to this year, it’s very similar. It hasn’t really dropped off. Maybe it’s even increased a little bit in terms of like how many purchase mortgages I’m doing. But overall, like you’re seeing a lot of mortgage lenders fold. You saw Loan Depot lost a billion or 100 million. It was a large amount of money. Large lenders are trying to fold and lay off large amounts of people. Mortgage lenders are going through what their cycle is, which happens when rates go up, as they just start shutting down and cutting out people.

Silva [00:08:38] In anticipation of what’s to come.

Artin [00:08:41] Yeah, it’s for how long. They don’t know how long this process will go. And at the same time too, it’s like right now they’re not paying, making a profit. So right now it’s like they have a huge payroll. They had we saw rates being the lowest they’ve ever been. So they hired and staffed up and brought in a ton of people. They saw rates just go up so quickly that it was almost like a light switch. So now all the revenue is gone or a lot of the revenue is gone, so or.

Silva [00:09:04] It’s eating into the profits.

Artin [00:09:04] Profits, it’s eating its profits. But a lot of mortgage companies, probably won’t be making a lot of money this year. This is just kind of like the way the cycle of owning a mortgage company is, is that you’ll have a like you’ll have some years where you make a ton of money and some years where you don’t make much money. You’re just trying to keep the lights on. And so what they’re trying to do after they have to layoff, they have to slim down, they have to get rid of all the fat because they need to be in a place where they can at least hope to break even during this period of time so that when it does, time does come time to make money. They’re ready to go.

Silva [00:09:36] We have access to you who’s an expert in this space. What are the absolute things we must know as we prepare for this length of uncertainty that’s coming our way?

Artin [00:09:47] So I was speaking to realtors or to buyers?

Silva [00:09:50] Think we should talk to both.

Artin [00:09:59]  Realtors need to be able to communicate to the buyers and sellers that this is the environment we’re in. From the seller’s side, you have to be able to say, like, what are the risks of waiting to sell? And like, we’re starting to see that where the prices are starting to drop. I think it’s communicating that communicating like the difference in what the payment is like, even though three months ago this property sold multiple offers that like way above the listed price. The climate has changed and so we just have to educate and make sure that in front of that rather than trying to chase that market, because that will just like delay and make them lose more money. I think when it comes to buyers, I think a real turn has to be able to guide them and show them where they have to feel like they’re not overpaying because overpaying in this market would be a sin. It’s just like you have to be able they should be able to make sure that the client is buying something solid and be able to like have strong data to support it and also be able to communicate to the buyers that, like the interest rate being this high is a temporary thing. This is not a permanent thing. Somebody had somebody very smart — I can’t remember who — they said, you know, I’d rather buy a lower-priced property with a higher price rate versus a property with a higher price and a lower interest rate. The difference is, I can always change the loan I have on a property, but I can never change the price I pay for a property.

Silva [00:11:29] That’s very smart. The reality is, for a good chunk of the beginning of your loan, you’re only paying interest anyway. Yeah. So, you know, you have, what, about ten years or so to refi this loan, the 30-year loan that you’re taking. So that actually makes perfect sense.

Artin [00:11:53] Especially in the beginning. And then also like with refinance one thing I always look at too is like if you can afford to keep making the same payments, hopefully, you bought the place even though you’re thinking interest rates will come down, but you bought it with the ability to make that payment consistently. If you continue to make that payment and you refinance at the lower rate, you’re not starting again for 30 years, which is, I think, the hard part about refinancing. You’re actually you’ll pay off your loan faster than you originally were planning to. Right. So there’s a way to make it always work for you as long as you play it. There are fiscally responsible ways to refinance at any time, even if you’re 15 years into it and you do this and you keep that, keep the same payment, you’ll just pay off your loan faster. But yeah, in a practical sense for sure. In the beginning, the first couple of years, hopefully, this doesn’t take that long to cycle through. Maybe it could, but I think at any point you just kind of plan for the worst, but hope for the best and just adjust accordingly.

Silva [00:12:49] Anything else you want everybody to know about? About the current circumstances in the climate, we’re in?

Artin [00:12:55] I think the main thing is like to be informed and not to act on the fear. I think if you’re if you’re not buying because you’re scared, but like rather than looking at all the data or not selling because you think, oh, maybe it’ll come back, I’ll go up. I think you just have to really look at the information and make decisions based on information rather than fear. And I feel like that’s driven, that drives the marketplace. I saw it happen in 2008 when people let their properties go away, which if they held them now, they would have been totally fine and then even made money. So far, let them run that way. We saw it in 2006. The fear of missing out pushed the prices up too. So you seeing like all this kind of stuff. So you just don’t want to let fear and the general consensus push you in a way that doesn’t make sense. Look at the data, take a breath, and then make a decision.

Silva [00:13:49] That’s great advice. Thank you so much.

Silva [00:13:51] Thank you. We appreciate you being here. We’re going to pick your brain some more. All right. So this has been an episode with Artin Babayan with PrimeLending. I think the great advice you just gave is to keep your emotions in check no matter what happens. The most important thing and to look at the data. All right. Do us a favor. Make sure you subscribe. Comment. Ask a question and make a suggestion on the topic. We love hearing from you. And for now, this has been another episode at Prospect Group where we talk about real estate and how to help you make more money. We’ll see you next time.

The post Interest Rate Increase Impact on Real Estate in Southern California [by Artin Babayan] appeared first on Prospect Group.

The first thing to consider is the reason for buying. If the property will be a resident and a permanent home, it’s a good idea.

The next question is, do you like the property?

Greg Davtyan, acquisition manager and investment specialist with Prospect Group an investment group that buy home fast for cash says, take time to think about it. Make sure the process is not rushed and the decisions are not emotional ones.

“Be sure you can afford the property and that you are qualified to make the payments,” says Davtyan. “If you can afford it, it doesn’t matter where the market goes.”

The real estate market is going to have its ups and downs but historically values have gone up over time.

For most people, the challenging part of purchasing a property is the downpayment. Davtyan says, with rents steadily increasing in Southern California, saving for a down payment to buy a property will pay off in the long run.

“Even if it means you need to do something extra on the side to give you the extra boost to be able to put at least put a little down so you can buy a place,” he says it’s worth it.

It’s a difficult sacrifice to make but the benefit of owning a property is knowing that there’s a fixed payment and nobody is at the mercy of a landlord increasing the rent due to inflation or supply and demand.

A property builds equity over time that can help an owner take out money and/or use it for other investment vehicles. Over time, even if the market dips, the value of homes historically has climbed back up.

Before making a purchase be sure to make an educated offer based on research and the guidance of a real professional, someone who is truly helping in the transaction and negotiation process.

To learn more about the topic watch the video or follow the conversation below:

Silva [00:00:00] Hello, everybody. Ooh, my hair looks kind of funky. I’m Silva. Welcome to Prospect Group. We like to have a lot of fun here. Thanks for coming back. We talk about real estate on this channel and everything about investing and selling and buying. This is where we help you make more money and we have a lot of fun in the process. Joining us today is Greg. He is one of our acquisition managers, an investment specialist. He’s an expert in this space. He’s been doing it for some time. This is a man who knows his numbers. Okay. So if you are wondering whether you should buy a house or a property in 2022, particularly since as of June of this month, which is when we’re taping interest rates being where they are, we have some tips for you and some ideas and he’s going to share them with us. But before we move on, I don’t know if I already said subscribe, if I did do it again, or send it to someone else to do it. Greg, is this a good time to buy real estate in 2022, considering the circumstances?

Greg [00:01:11] Well, I think there are a few things when it comes to that. I think you really have to think like, do I like it first of all?

Silva [00:01:19] Like what? The property?

Greg [00:01:21] Do I like the property? Do I really like the property? You know, think a little longer than like one night, two nights. You know, sometimes it’s like by, you know, buyers go in and it’s like, oh my God. And then, you know, the dust settles a few days. And so I just like, make sure you’re not rushing it. So make sure you like the house and then next thing, make sure you can afford it. I mean, ask yourself, what can I afford it? Am I qualified for it? And if you are, I mean, it doesn’t matter where the market is going tomorrow, I think you should buy it because this is my theory on it. I mean, the real estate market is going to have its downs, but it’s always going to keep going up. Whereas you for as far as what we know. Right, because it’s tied to inflation mostly, you know, I mean, interest rates going up. Rent is probably going to be going up and home prices are probably going to be going up eventually. No. Yeah, throughout time.

Silva [00:02:26] Throughout time, throughout. Just what you’re saying you’re talking about historically, we have seen an increase in home prices decade.

Greg [00:02:33] After decade.

Silva [00:02:33] Decade after decade, particularly in Southern California.

Greg [00:02:36] Yes. Yeah. Yeah. Let’s talk about California. Yeah, right. I’m in the Los Angeles market mostly. Right. So I’m gonna talk about L.A., California. I mean, throughout time, we’re going to see prices shoot up mostly, you know, most, almost most likely. Right. So I think, you know, when people are renting, they really have to think about like rent is going to keep going up. Right. Just like home prices.  I mean, rents. Rent has gone up. Rent used to be like $800, then it went up to $1500. Now for a two-bedroom. Right. You’re paying about like.

Silva [00:03:10] $2700.

Greg [00:03:11] $2000, $3000 and sometimes, you know, 4000 depending on the area. So it’s going to keep going up. And I mean, if you’re renting, you’re going to constantly be paying more, most likely. But I mean, if you buy a house, you know, you’re going to be on a fixed payment, right? You’re going to be on a fixed payment and two, three, four, or five years later or, you know, down the road, hopefully, interest rates go down. You can refinance. Right. And then you can save even more money. Besides on, you know, the return on investment that you’re going to be making throughout time on that property.

Silva [00:03:47] There you go.

Greg [00:03:50] Should you buy a property? If you could afford it? If you really like the house. As long as you’re not paying crazy over and doing, you know, some ludicrous offer, to get it. I mean, I think you should buy it.

Silva [00:04:04] Do you think that this kind of reasoning and thought process is the reason why we have seen inflation, we’ve seen the interest rate hikes, we’ve seen talks of recession, but we haven’t really seen the price of homes dropping at the same rate as everything else has been moving? Because when it comes to really absorbing and processing, the reason we buy homes has never changed. Right. Because when you compare the payment amount of a house versus the rent that you’re going to pay, particularly in Southern California, in the Los Angeles area, sometimes the payment is lower than the rent you’re going to pay.

Greg [00:04:52] Yeah, sometimes. But, you know, and in that sense, it’s not going to be. You know, it’s not going to go down, you know, in correlation to how much things have gone up. You know, as inflation keeps going up, you might see we might see some adjustment in prices because of inventory shortage. And then it could bounce back up.

Silva [00:05:15] Right.

Greg [00:05:16] So are we heading towards a decline? Possibly. That’s where all indications are pointing to based on the economy and based on of where the market’s been in the past few years, as we know, in a frenzy. But a lot of it depends on the inventory level. So how much inventory are we going to see ending this year? And that’s going to dictate a lot on, you know, how much of a slump the market goes into, you know, in the time frame of it jumping back.

Silva [00:05:46] But, what you’re saying is that none of that all of those intricacies don’t really matter if you’re really buying a home that you’re going to live in. No interest rate. A percentage here, a percentage there, three quarters here. You know, the price of the house, $50,000 here, $100,000 is not going to make a difference for a long-term investment in a home that you are going to make your permanent home.

Greg [00:06:12]  If you’re going to occupy a place, as long as again, you’re not offering something crazy, as long as, you know, you’re making an educated offer based on research, you know, and the guidance of a real professional, someone who is truly helping you. I don’t think you could go wrong because over time, even if the market dips, the value of homes is going to climb back up, and eventually it’s going to probably reach the value it was before and probably past it. So real estate, I think, is always a good investment, even if it’s just to occupy a place you’re building equity which you can take out later, and put into another investment vehicle. And I mean, if you’re renting, you’re just more likely going to be paying more and more money as time goes. So I think buying a place is important. It just, you know, the difference is getting that down payment. So for most people, you know, I always say you just have to find if your one career is not enough to get you to a point to buy a house, you need to do something extra on the side to give you that extra boost, to be, you know, to be able to put at least a little down so you can hopefully buy a place and, you know, have that fixed payment refinance later, maybe, you know, get your payment lower and have more of a guaranteed payment. Yeah. That, you know, you have to pay, you know.

Silva [00:07:41]  Thank you for that informative and important information. And you know, this particular segment and segments like this and multiple other ones I’ve had with a lender who talks about the importance and of buying and when to buy and how to be prepared to buy and how that actually impacts and is the path for financial freedom and how financial literacy actually allows you to make those determinations and decisions. This is the point of this channel. We offer a value Greg’s perspective from where he sits and being in the market, the Lender’s perspective, and when he sits and what he sees, the numbers, all of these people crunch numbers, look at finance all the time. We hope that you use all of this information to make decisions specifically for yourself. If you are someone who wants to buy a house and if you’re a realtor, you can use these arguments for people who are on the market and become your clients.

Greg [00:08:41] And I come from an accounting background, so I think it’s important for people to make sure, you know, they’re really on top of their taxes, especially people in business.

Silva [00:08:52] Oh, he’s going to talk about taxes. That’s another subject.

Greg [00:08:55] I don’t want to go into it. I don’t want to go too deep into it. That will be another subject.

Silva [00:08:59] We’re gonna do another segment on taxes. I got to wrap this one up, but we’re going to listen, I promise you, real estate and taxes, that’s the next one. All right. Thank you, Greg. And be sure to subscribe. I’m Silva, this is Prospect Group. See you next time.

The post Should You Buy Real Estate in 2022? Interview with Greg Davtyan appeared first on Prospect Group.

Fortunately, there are various methods to manage your finances, and maybe even permanently reduce mortgage payments. For us, there are two ways that are particularly effective: mortgage loan modification and refinancing. 

In this article, we are going to talk about both of these options and hopefully help you determine which of them is the smarter choice for you. 

What Is a Loan Modification?

A loan mortgage loan modification (sometimes also referred to as home loans modification) is the application of changes to the original terms of your mortgage loan. 

The objective is to determine the conditions that can be improved so that you can better settle your home loans and adjust them accordingly.

As such, you will need to work together with your current lender. You will also need their consent. 

Here are just some of the terms that you can get adjusted:

• Loan Term. One of the most common home loans modification is applied to the loan term. This is ideal if you’re having difficulties making your monthly payments. After all, making your loan term longer will also make the monthly dues smaller.
• Interest Rate. If you have found that the current interest rates being provided by your lender have significantly decreased compared to when you have signed your contract, then there might be a way to modify it and decrease yours as well. Doing so can also potentially lower your monthly dues.
• Loan Structure. This is an option for those who want to switch from an adjustable interest structure to a fixed-rate one and vice versa. This is usually recommended for those who have recently experienced changes in their mode of employment.
• Principal Forbearance. This is done by setting aside a part of your principal balance to be paid at a later date. This type of modification is rarely done but can still prove beneficial to avoid an imminent foreclosure. 

How Can You Modify Your Loan?

Please keep in mind that modifying your loan may negatively impact your credit score. However, if you’re sure that you want to try this method, then you will need to get certain documents ready. The first requirement is usually your proof of income. This will serve as evidence that your income is not enough to cover the rate of your current mortgage.

You will also need your most recent tax return as well as bank statements to have a better insight into your current financial state.

Finally, you will need to write a hardship letter that will state the reasons why you can’t pay your monthly payments any longer (or even your entire loan, for that matter). 

Reasons for Loan Modification

Applying for a loan modification is a great idea if you are having difficulties making your monthly payments. It is also a wise decision if you think that you already owe more than what your property is worth.

For others, they believe that a loan modification can help avoid foreclosure and sell their home after the process. Here’s the deal: even if you are granted a loan modification, it still doesn’t mean that you should continue living in a property if it doesn’t make sense to you anymore. Maybe your job requires you to relocate? Or do you simply want to downsize now that the kids are in college?

Regardless of your reasons, it is possible to sell your home easily and stress-free. Feel free to contact us so we can further answer your questions such as what to expect during the foreclosure process?

What Is Mortgage Refinancing?

Meanwhile, let us move on to talk about mortgage refinancing. It is the method of replacing your existing loan with a new one. You’re not just modifying your contract like earlier. This time you are completely renewing everything. 

Doing so can change the term of your mortgage, completely recalculate interest rates, and even change your loan type.

How to Refinance Your Loan?

The process of refinancing your mortgage is closely similar to applying for a new loan. First, you will need to find a lender, go through their application process, and submit the needed financial documentation for underwriting.

Most lenders would also require an appraisal of your property. After all, your lender wants to make sure that they are not letting you borrow more than what your house is actually worth. 

Then, once these steps are complete, your lender will provide you with a Closing Disclosure. It is a document that will contain all the important details of your loan along with the closing costs. They will then conduct a closing meeting with you where you will be able to sign your new contract.

How to Decide Between Loan Modification and Refinancing?

The answer will highly depend on your personal reasons and current financial state. A loan modification is usually undertaken by people who are significantly behind their mortgage dues. Meanwhile, those who apply for refinancing are generally in good financial shape and are more than capable of covering the closing costs.

Those who are planning to sell their property will be pleased to know that it is possible to sell after a loan modification or refinance. Just be sure to check your terms and see if there’s an owner-occupancy clause in your contract as this will require you to stay in your property for a certain amount of time before you will be able to sell or rent it out.

Final Thoughts

The bottom line is, there are multiple options that can help you avoid foreclosure and losing the property you’ve worked so hard for. Loan modification and refinancing are just two of your available options. You may also consult with your lender if there are other methods that you can explore. Good luck!

The post The Difference Between Loan Modification and Refinancing: All You Need To Know appeared first on Prospect Group.

That’s the big question.

Selling a house or any real estate property is one of the toughest jobs. Whether you’ve been thinking about it for some time now or the decision came in a rush, many factors can affect how quickly you can sell your home. These include the location, size, and price of your property.

Check out these five tips to sell your home fast:

Talk to Your Agent

Look for a licensed professional in your area. Yes, there are many realty agents out there but not all of them can sell your home quickly. Look for someone who is licensed, has enough experience, and has a good background. Interview at least three agents and ask for a list of properties they have sold. You should also check their profile online (websites, social media, etc.) to get to know them better.

Make Some Repair Work

To get your home sold quickly, you need to make sure it’s in the best condition. If possible, hire remodeling contractors to conduct a thorough inspection of your property. No one wants to move to a home that has a leaking roof or broken windows. If you think some renovation work or upgrade is necessary (and if you have the budget), go for it. Home improvement can greatly increase the value of your property which means more $$$ when you sell it. The same applies to outdoor features, especially your pool. A well planned swimming pool renovation can refresh the entire backyard, improve safety and appearance, and make your home more attractive to buyers who want a move in ready property.

Hire Pro Cleaners

A messy home can greatly turn off potential buyers. Before you invite them to an open house, make sure that your home – from the exterior to the interior – looks nice and clean. Make every corner of your home sparkle. It’s best to hire professional cleaners to do the job because they have special equipment to deal with the toughest dirt in your home, from the stains on your tile floors to the ugly spots on your kitchen ceiling. You should also remove the clutter and organize your space. Consider renting a storage unit for your belongings and other personal items. A clean and organized space helps potential buyers envision how living in their new home would feel like.

Don’t Forget the Landscape

Create a good first impression among buyers by improving your landscaping. An attractive and well-maintained landscape can increase the value of your property by as much as 10%. Ideally, you want to get started with cleaning your yard as early as one month before your scheduled ‘open house’. Apply a new mulch, add some beautiful plant containers and decorations that can improve your patio and doorway, repaint the fence, clean up the water features, etc. Consider adding a fresh coat of paint on your front door. Choose a color that contrasts with the color of your home.

Organize Bedroom Closets and Cabinets

One of the major considerations people make before buying a home is how much storage they have. Messy closets and cabinets make your home appear like it doesn’t have enough space. It also sends a negative message to potential buyers. For example, they might conclude that you don’t take care of your house just as you don’t take care of your belongings.

Start by hiring the best real estate agent in your area who can help you find the right buyer. Next, prepare your property. Make sure to have it cleaned and repaired if needed. Don’t forget to spruce up your home exterior to make a lasting impression among potential buyers. And lastly, showcase the best features of your property, including the closets and cabinets.

The post 5 Tips for Preparing Your Home for Sale appeared first on Prospect Group.

A Growing Trend

More and more buyers want to leave the smallest carbon footprint possible. This is one of the many drivers of sustainable houses becoming an important trend during 2021. Plus, millennials specifically are very concerned about the environment, and they are currently the largest house-buying group, with many of them looking for their first home. In addition, millennials are highly motivated by purchases that they feel align with their ethics, something that is also seen in Gen Z, which will be home-buyers soon enough.

Sustainability is more than a fad, it is quickly becoming a lifestyle for many people. By investing in making your home a more sustainable one, you will be looking out for the environment and the future value of your property if you one day choose to sell it.

Benefits of Buying or Selling a Sustainable Property

Investing in sustainable property will have many benefits for you. By installing items such as solar panels and water recyclers, you will be able to sell your sustainable house fast when the time comes. If you are currently looking to buy a house, then going for one with sustainable features is the perfect way to ensure you will have a high-value property.

Also, if you decide to turn your traditional home into a sustainable one, you will be automatically increasing the value of the property. While this initial investment is likely to be a hefty one, it’s undoubtedly worth it when you think about it in the long term. It has been estimated that sustainable homes go for almost 4% more than their counterparts. This gives you an undeniable advantage in the real estate market.

Another aspect to consider is that the world is always changing and that this is a time of technological revolution. By adapting to these changes early enough, you will be able to make the most of them and even set some trends in your neighborhood.

Also, you get to add to the worldwide initiative of taking better care of the environment, with the hopes of avoiding disastrous events in the future caused by climate change. Something positive to consider is that providers of sustainable items are becoming more widespread, which also helps in decreasing the initial costs of turning a standard property into a sustainable one.

Energy Sustainability

There are also short-term and medium-term advantages to buying or investing in a sustainable home. The use of solar panels and appliances using alternative sources of energy will help you reduce your energy consumption levels. This can translate into a lower electricity bill at the end of each month. Your total energy consumption can decrease by 33%!

In addition, having a more efficient water consumption will also have an impact on your utility expenses. You will also have fewer maintenance costs overall, which is a great benefit to consider.

Also, including energy-efficient HVAC systems will allow you to save quite a bit on your energy expenses as well while you take care of the environment. As if this wasn’t enough, you can become eligible for rebates provided by the government at the local, state, and national levels. Overall, your maintenance costs can decrease by 22%.

Rental Benefits

Being able to rent your sustainable home is a great way to recover your investment. The fact that it’s sustainable will be an added attractive feature for possible tenants. In addition, you should keep in mind that the lower management costs will help you save considerable money and time.

Also, you can make small changes to being with, such as changing the types of light bulbs you are using before going all the way and installing solar panels. This is a great way to pace yourself and go through the process progressively.

If you own multiple properties, then adapting them to sustainable standards one by one is likely to be the best way to go. This is because of the magnitude of the investment. However, you are even more likely to get a return on your investment when multiple properties are involved.

Also, earning a green building certification can be equal to big savings. This has been a tactic used by property owners in different cities, retrofitting older buildings to meet these standards.

Future Perspectives

It is expected that additional tax reductions will be offered to owners of sustainable homes in the near future. This is because the growing concern about climate change has opened the conversation and it has provided a platform to propose different measures to lower the carbon footprint. Tax reductions are one of the offers a national government can propose to make the use of alternative energy a more attractive option for its citizens and residents.

The post 5 Reasons to Invest in Sustainability of Your Home appeared first on Prospect Group.

Real Estate Market vs Stock vs Bitcoin

How are investors supposed to choose between these three options? Well, it’s all going to come down to personal preferences, of course, but also to the risk profile of each investor. When it comes to real estate, some of the pros to be considered are the fact that this is a tangible asset with tax benefits and long-term returns. In addition, investing in real estate can yield high cash flow and it provides investors with versatile opportunities. This is especially important for large investors. That said, real estate is not a fluid asset, and it’s inevitably a high maintenance investment if the property is kept in good shape.

When it comes to bitcoin, it is expected that investment will be adopted more easily by younger generations, who are more familiar with the digital world. That said, even traditional investment firms like Wells Fargo have shown an interest in the subject. The reason for this? Bitcoin has reached a market capitalization estimated at $560 billion in over 12 years. It’s official, bitcoin is here to stay.

Some of the pros of investing in bitcoin are that it’s a peer-to-peer system, making it more accessible. In addition, inflation is not an issue, and entering the cryptocurrency market usually has a lower cost than investing in real estate, and bitcoin does not require costly maintenance. Another benefit is how easy trading bitcoin has become, which is only bound to become easier as more services are offered. Some aspects that could be considered negative are that bitcoin is not a tangible asset and security is still developing and growing.

Meanwhile, the stock market is a well-known investment option, but does that mean it’s the best option? The stock market has existed for decades for good reason. Long-term returns are usually the goal and timing when buying and selling plays an important role, like in real estate and bitcoin. However, access to stock investing might be more limited and the fact that more companies are offering cryptocurrency options now is something to consider.

Fast Homebuyers Now Buying in Cryptocurrency?

Despite the encouraging data surrounding bitcoin and cryptocurrency as a whole, there are always risks and challenges to be considered. Most people still see cryptocurrency investment as a risky endeavor, which might dissuade investors from getting involved. In addition, the economic consequences of the long lockdowns that have taken place in 2020 are only beginning to be felt.

However, thanks to the immediacy offered by cryptocurrency purchases, owners can sell their house to homebuyers fast. Now, some homeowners offer the option of buying in crypto or in cash, which is especially useful for people looking to buy a house quickly.

The challenge for both bitcoin and the stock market is to prove to investors that they continue to be good options for people to invest their money. For crypto, the next step could be finding a spot among traditional investment firms, something that’s already starting to happen. At the end of the day, it’s going to come down to how much trust investors have in these markets.

Lastly, it’s always important to have a diversified portfolio, something that can be done by investing in both real estate and bitcoin. By buying real estate, investors can have a long-term tangible investment, while investing in bitcoin can be a more passive and low-maintenance source of income. Plus, investing in bitcoin allows them to have an easy cash source when they need to sell, which can be easily done.

Major Real Estate Investments and Bitcoin Changes

As the offer of cryptocurrencies widens, with bitcoin and Ethereum at the helm of the market, how they can be used have also expanded considerably. As homeowners become savvier about bitcoin, they open up to the idea of using it for transactions, and there are many pros in doing so.

Also, concerns about the risks of investing in bitcoin have decreased during 2020. During this year, bitcoin showed a growth of 204%. This places it as quite a solid investment for 2021 and the upcoming years.

Using bitcoins for real estate transactions is a great way to prevent fraud, thanks to the existence of certifiable digital IDs. In addition, real estate fees can be lower and investors might benefit from selling or buying real estate tokens in fractions. Furthermore, one of the main principles of cryptocurrency is decentralization and transparency between the parties involved while protecting their privacy at the same time.

The post The Shift in Real Estate Market vs Bitcoin Growth in 2021 appeared first on Prospect Group.

Choosing the way to sell a house

The method you use to take your house to market will vary depending on whether you need to sell your house fast, and what sort of area you live in. On top of that, you’ll need to think about the sale price and many other aspects. Your choices are going it alone, or selling with a real estate agent.

Should you sell your house with a real estate agent?

A real estate agent has a downside; they’re costly. Obviously, they take a percentage of the sale price or their own fee, and this makes it really tempting to go it alone, but this is not a good idea in the majority of situations. Real estate agents earn their money by getting you a better price, forcing through a quick sale, and helping with the admin. They may also have some unique tips for selling your home or a list of potential buyers ready to go.

Selling a house yourself fast and for cash

You can sell by yourself if you wish. You don’t actually need the help of a real estate agent if you know what you’re doing. The problem is that the majority of people aren’t equipped to do this. Even if you get your home sold, it can be hard to know the correct steps to take to push through the admin of a sale. But you can always sell your house fast to homebuyers, without any additional efforts and get a fair cash offer.

How to choose the right time to sell the property as an owner

There is an art to choosing the right time to sell a home. It also varies depending on the area where you are living and on global events. For instance, in recent years a lot of people have been moving out of big cities and into smaller, rural locations.   Selling your home quick is largely about timing. Did you know that the holidays could even be a good time to sell? There is low inventory on the market and a lot of the buyers are very keen to get a deal put together very quickly.

Preparing a house for sale: What to know before it?

There are many different curb appeal tips for selling your home. You need to embrace any home selling tips that might just get someone more interested in buying the property, and this means preparing your home for sale by making it look good. It may seem superficial, but numerous studies show that unless someone can visualize living in a property, they’re not likely to make an offer.

• Cleaning and organizing tips

One of the first staging tips for selling your home is to clean it up and get organized. It might feel irrelevant – all this stuff is going to be gone once you move, right? Actually, it is vitally important that you clean up and get organized, and try to declutter the home. This makes it far easier for somebody to envisage themselves living in space, and to assume that it is easy to keep organized.   Cleaning and organizing, and even a lick of paint here and there, can ensure people see the full potential of the space rather than focusing on the clutter or the items spread around the home.

• Quick repairs tips for selling your house

Most homes have got those quick and easy repairs that could be made. When it’s your own home, you will probably put these things off for a while. It’s easier to put up with a wonky light shade than it is to get a ladder out to fix it! You may also have let certain things get a little tired and worn.    Before you sell, and before you view, it is time to get those repairs carried out. Whether you do this yourself or get a professional in to make the changes you need to your house, it is important that you follow some staging tips for selling your home, and that includes making sure that things aren’t broken and run down when people come to see the house. Again, this is all about people envisaging themselves living in the home.

What are the common mistakes when selling a house?

As well as useful tips for selling your home, there are some common mistakes to avoid. It’s amazing how many people still make these errors! Avoiding them can gain you a higher price for your house, and make the sale process quicker and easier.

• Expecting to get the asking price. The vast majority of homes sell for, under the asking price, a real estate agent will help you to set an asking price with a view to negotiations.
• Hiding problems with the home. It is better, to be honest. If you don’t tell people, the problems will usually get found during a survey and the whole sale can break down as a result.
• Not qualifying the buyers. There are a surprising amount of time wasters out there or people who won’t have the backing needed when push comes to shove.
• Not getting professional photos. Most people start the process of looking for homes online, and if you are not going to put good photos on then you are missing out on hundreds or even thousands of potential buyers.

Selling your home doesn’t have to be stressful or complex, especially if you can take your time with it. Follow our home selling tips to get the best price and to ensure the process goes as smoothly as it possibly can. When it’s time to sell up, make sure you give it the necessary thought. This is always a big decision.

The post 6 Tips For Selling Your Home Easy and Stress-Free appeared first on Prospect Group.

Is There a Difference Between an Apartment and a Condo?

There are actually some significant differences between apartment and condo living. An apartment block is usually made up of a number of smaller apartments within a large building, often set over dozens of floors, especially in built-up areas.   What’s the difference between a condo and an apartment when it comes to your finances? Well, in the majority of cases you don’t own the apartment, you merely pay a monthly rent to live there. This also means you aren’t responsible for the upkeep.   In a condo, you will still pay a monthly fee, which is designed to help with the upkeep, and go into the homeowners association to pay for renovations and communal spaces.

What is a Condo?

A condo is a unit in a community living setup. This might be a high-rise building. The condo is a building you actually own, and you often don’t get the option to rent a condominium.   You also pay into the homeowners association. This means that there are usually communal facilities and maintenance that are taken care of by the HOA. There are lots of benefits to this, and you don’t have to worry too much about upkeep. Not much besides decorating is your duty to fix.   This is a good option for those who don’t want to do too much work on a home, but it can be a little restrictive, as we’ll explore below.

Investing in a Condo vs Renting

When you rent a property, all of the money goes to the owner of that property. So, when you’re renting an apartment, you aren’t paying towards a mortgage or building up any equity or ownership.   With a condo, while you are still paying towards the HOA, which is not money you can recoup, there are some key advantages when compared to renting a house or an apartment.

• When you want to move, you can sell the condo and recoup some of the money.
• You can own a condo outright.
• In some scenarios, you can rent a condo out.

There are some downsides to a condo. The difference between apartment and condo might actually lead you to prefer an apartment. It can have less flexibility in terms of how much you are allowed to do. Even though you own it, you are bound by rules regarding changes you can make to the property. Also, an apartment makes it easier to move house at short notice.

Selling a Condo

Because of the rules that come along with a condo, and the fact that you can’t make drastic changes, it might be harder to sell a condo when the time comes. You might get lucky, some condo complexes even have waiting lists. It really depends on where you are living and how in demand that space is.   However, some people struggle via the traditional route of sale, listing with a realtor. You may find that it is more convenient to sell your multifamily property to investors, who can offer you a cash price quickly and take the condo off your hands.

Other Key Differences Between Apartment and Condo

Other key differences between an apartment and a condo include:

• Apartments usually don’t have HOAs.
• You might find that you share a lot more facilities with a condo.
• You might have amenities on-site, such as gyms, gardens, and pools, paid for through the HOA.

Difference Between Townhouse and Condo

The differences between condos and townhouses can be pretty subtle. Both have homeowners associations and therefore fees attached to that. Also, some townhouse setups are within communities and the whole thing can feel a lot like a condo setup!   There are some important differences to understand, though. A townhouse is not a condo, and in the majority of cases, it gives you much more flexibility when it comes to what you can actually do with the home. This can also come with more responsibility, though. Depending on the contract you sign when you are moving in, you will probably be responsible for things like repairs in your unit, which, in a condo, might be paid for from the HOA.

What is a Townhouse?

Townhouses tend to have shared external walls with the neighbors. They may have yards and outdoor spaces that are not really common in condos.   The homeowner gets more space when they buy a townhouse and often own the land it sits on as well as the home itself. You can also find that you have more freedom for what you wish to do with the home. However, there are some similarities. The grounds and exterior may still be kept by an HOA, which you will have to pay into.   A townhouse could be considered a middle ground between a single-family home and a condo. It’s usually more spacious, and the rules are slightly more relaxed, but you still have to stick to the restrictions that are in place and pay towards the upkeep of your community, as well as any shared amenities.   Of course, there are similarities. Both of these types of properties give you a level of ownership. You don’t get this with an apartment that you rent. Both will need you to budget for your mortgage as well as the agreed contributions to the HOA, which is set up when you first move in.

Key Differences Between a Condo and a Townhouse

The key differences between a condo and a townhouse include:

• Though there is an HOA with a townhouse, you usually pay much less towards this than you would in a condo. You are therefore responsible for more repairs.
• You probably have more flexibility over design decisions when it comes to a townhouse.
• Townhouses have more space in general and could have an outdoor area.
• Condos are easier to maintain for the owners.
• A condo might be more overlooked with more shared entrance areas.

It’s important to understand that some townhouse and condo setups are actually pretty similar. If your HOA agreement covers more than the norm in a townhouse, it can closely resemble living in a condo, just usually a slightly bigger condo!

Conclusion

It’s always a good thing to have options. When you’re thinking about moving, the best thing to do is to consider the types of property you can afford and what will suit your own needs the best. Some people find that a condo is ideal due to the fact that it is low maintenance, but some people find them a little restrictive, plus they can be tough to sell property fast when you move on. A townhouse is normally a little more flexible, but any type of property comes with its unique set of pros and cons.

The post What’s The Difference Between Townhouse, Condo and Apartment: Renting, Selling, and More appeared first on Prospect Group.