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Finding Risk-Free Investments - A Well Hidden Secret In Real Estate Investments
If you're attempting to construct a nest egg that won't crack, it's important to establish a safe and dependable investment strategy.
Yet last year alone, countless Americans lost their life savings through investments that looked safe. In some cases, people lost both their jobs and their pensions when businesses failed to restructure, leading to bankruptcy and closures.
If you're a business owner that's restructured your company, but need more funds than restructuring can offer you, think about real estate.
For example, real estate has long been known as a secure, tangible investment because it generally appreciates as time passes. But most would-be investors aren't real estate experts, and many of us don't have enough money to fund the purchase of an investment property let alone to fix up a run-down house.
However, there is another strategy. It's called cash flow investing and it allows folks to benefit from secure and lucrative real estate investments without buying or selling properties.
Put simply, a real estate cash flow note is a private mortgage created between two individuals rather than between a buyer and a bank. What a lot of people don't know is that one in 13 American homes is sold this way.
A lot like banks, which purchase previously created mortgages, private individuals can buy cash flow notes to build returns of 20 percent or more. Here's how it works:
Let's say I sold a home for $100000 and my buyer had $50000 to use as a down payment. I can draw up a contract that takes $50000 down and finances the remaining $50000 over 30 years.
Now I have a cash flow note that yields monthly payments of $299 each month secured by real estate.
As a note holder, I have two options. I can take advantage of the monthly income and interest, or I can sell the note to another investor for instant cash.
This really is where you, as an investor, come in to make money. Let's say you're an investor with $35000 to invest. I may not be willing to wait 30 years for my funds, so I'll sell you my $50000 cash flow note for $35000.
Many investors find they can buy notes at great prices just because the original note holder wants to "cash out." Now you are receiving a steady monthly income of almost $300 and you're in a position to make a 30 percent gain on your investment-even before interest.
Best of all, in contrast to stocks and bonds, your cash flow note investment is secured by real estate, which is one of the most solid investment in the world.
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