7 Essential Deal Evaluation Tools

Knowing what your goals and the amount of finance you have to invest in real estate are two factors that you must consider right from the get go.

It’s also better to know what kind of deals you can work on depending on the amount of finance you have or have access to.

Yet the smartest thing of all to understand are the 7 essential steps to evaluating profitable deals:

#1: Location

Usually, the location will tell you what techniques you should use. Ugly houses are for wholesale and retail while for nice houses, you do option, lease-purchase or owner financing. What you should look for are ugly homes that need repair as well as properties in appreciating areas, easy terms, seller financing and located in high rental markets.

#2: Real Estate Bargains

Find good bargains. The better the bargain is, the more you profit. The best real estate bargains usually occur due to highly motivated sellers.

#3: Motivated Sellers

Motivated sellers are usually people who need help, thanks to their property being the problem. They’re the ones that will make an excellent deal for real estate investors.

#4: Gathering Information

Gathering information is vital to making the best possible analysis of a given property. For this, you should use a Property Research Form, Property Inspection Sheet, An All Cash Offer Worksheet as well as Repair values.

#5: Contracts

Ensure that your contracts are literally bulletproof and for which you should contact your lawyer before using generic forms online. Also, take state laws among other factors into consideration before using them too.

#6: Use Other People’s Money

There’s tremendous leverage to be gained from using other people’s money. Some of the sources include friends, banks and other investors as well as subordination and substitution of collateral technique.

#7: Closing

Make sure you hire a Title Company when closing a deal. Not only do they research the title for any defect but will close the deal and give you title insurance as well.