| Just by picking up the local news paper, it's hard to | | | | strategy, but it's NOT the only buying strategy used to |
| look past the abundance of We Buy Houses classified | | | | buy properties. The following are a few additional |
| ads. In addition to print advertising, chances are you | | | | buying strategies that investors use to purchase |
| have/will be driving by a multitude of We Buy Houses | | | | properties. |
| bandit signs (a.k.a. road signs) of the major highways in | | | | · Short Sale - This is a process whereby the |
| the greater Knoxville, TN area. Let us not forget about | | | | delinquent mortgage holder is in agreement with the |
| billboards, radio or television marketing either. Last but | | | | lender to sell the house for less than the mortgage |
| not least, real estate investors are popping up all over | | | | balance. Typically in this situation the home owner has |
| the internet trying to buy homes. | | | | been behind on paying the mortgage payments and |
| Investors today are buying properties in Knoxville to | | | | the mortgage balance is usually greater than the value |
| reap the financial rewards found in real estate. These | | | | of the home. The current owner of the home is |
| same house buyers are looking for investment | | | | expected to have the house sold for less than market |
| property that will return them money in one of two | | | | value to an end buyer without receiving any funds |
| ways. They are looking for a return on their money | | | | from the sell price. Often times a Short Sale can be |
| either by a (1) capital gains method or a (2) cash flow | | | | the best outcome for both the lender as well as the |
| method. | | | | current home owner. |
| Many real estate investors purchase homes to fix up | | | | · Owner Financing - This is a process whereby the |
| (a.k.a. rehab) and sell to an end buyer that is ready to | | | | current homeowner typically owns the property free |
| move into it. This type of investor likes to flip houses. | | | | and clear and decides to sell it to a buyer. A buyer that |
| Their strategy involves buying properties at the lowest | | | | does not bring 100% of the funds to the closing table |
| possible price. They can then rehab any the damages | | | | (i.e. cash, private money source of funds or traditional |
| do to the home and resell it for the highest possible | | | | bank financing) can use Owner Financing to purchase |
| price to an end buyer. These are capital gains types of | | | | the property. Then terms of Owner Financing are |
| investments. Profits are made on the spread between | | | | agreed upon by both parties prior to closing. |
| the purchase price (along with the amount invested to | | | | · Existing Bank Financing - This is a process whereby |
| rehab it) and the sell price of the house. | | | | the current homeowner can keep the existing |
| Still other buyers are investing for cash flow. These | | | | mortgage in place an have the new buyer purchase |
| types of investment deals yield profits over a lifetime | | | | the house by using this same financing. Often times |
| of home ownership. Cash flowing property buyers are | | | | this is referred to as "Subject To" financing. It can also |
| obviously looking to purchase single family houses and | | | | be thought of as a version of the older version of |
| apartment buildings at reasonable low prices. However, | | | | assumable mortgage. |
| they are more concerned with the total amount of rent | | | | · Private Lender Financing - This is a process |
| per month that can be collected from each tenant. | | | | whereby there is a third party that provides the funding |
| Another advantage of owning cash flowing rentals is | | | | source. These Private Lenders will typically charge the |
| the tax benefits. Holding on to a profitable rental | | | | investor a higher rate for the cost of money, but the |
| property for more than a year can help the investor | | | | terms can be agreed upon prior to closing. |
| with (1) a smaller tax on capital gains, (2) depreciation | | | | There are a multitude of ways that investors can |
| of the property and (3) possible eligibility of a 1031 | | | | purchase property here in Knoxville, TN without having |
| exchange. | | | | the bring cash to the closing table. If you would like to |
| Most commonly property investors purchase homes | | | | learn more about selling your property to the We Buy |
| with cash. Sellers usually prefer it that way if they can | | | | Houses in Knoxville investors, then contact us to find |
| get an investor to write a check for the entire amount | | | | out your options. |
| to buy the house. This method is a great home buying | | | | |