How to Make Money With Commercial Real Estate

When you purchase a new property you expect it to be able to turn around a profit. In this article you will find out different strategies to earn additional income with your commercial real estate.

Commercial real estate is a hot commodity among investors. Quite frankly the possibilities are endless. You could have one location that is for your personal business. Another that you rent out to a tenant. Or one just for storage. It is all up to you when it comes to what you want to do with it. Fixing and flipping properties when done right is a very profitable, as well.

It's the little things that matter when it comes to commercial real estate

Taking the time out to make little repairs of cosmetic enhancements can make a vast difference in the amount of revenue that you end up making. Commercial real estate has hundreds of different variables that you can take advantage to bring in the best clientele. Many people make their money back if they take on a lot of the responsibility of managing their properties themselves. Why hire someone or a group of people to do something that can be done by you? You keep money in your pocket and in turn you can reinvest in something else.

 A great way to make money off of commercial real estate is to rent it out to multiple tenants. Say you have a property with roughly 2,400 square feet, instead of having one large business you could split it and have two businesses within the space. This is called a co-working space. Many of these types of businesses are popping up around the country. Depending on your assets you could buy a large piece of property and have two or three small companies renting space. Along with that, you can also give freelancers a payment plan in which you charge them to use the space. Judging on the different types of benefits and perks you have will also bring in more clients.

You can also do this with a home. Instead of having one family living in the house you have; instead, you can rent out the rooms and charge more than you would regularly with one person. By doing this you can make more money to pay off expenses that may come along renting out a space. For example, you may have to take out a commercial real estate loan to help cover the cost. If you were to rent off a home piece by piece you could possibly pay your loan off quicker.

What if I want to sell my commercial real estate property?

If you want to sell your commercial real estate you then should. As we stated before you have the power to do so. Judging on how must you put into your property the more you can possibly get for your money.  Say you bought a property below market value that does not need a lot of enhancements or repairs. You can sell it higher than market value. Or if you have a piece of commercial real estate with a business using it you can dissolve their tenure and sell it to them if they want the space.

Dennis Dahlberg Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:      (512) 516-1177 
Dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027

111 Congress Ave |Austin | Texas | 78701    

   

About the author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.

Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

How to Make Money: 3 tips for Investing in Notes

Whether you know it or not, you are already investing in notes, just probably on the wrong side of it. Note investing is the process of buying a debt that is owed and earning interest on that debt until the principal is repaid. If you interested in investing in notes, it is important that you learn all the facts so you know what you are getting into. Here are 3 quick tips to make investing in notes easier and more successful.


1. Do your research and decide which type of note you want to buy. If you are investing in notes, you can purchase credit card notes, auto loan notes, and mortgage notes among a few others. Credit card notes have the potential to earn high interest rates (just think of how much you end up paying if you carry a balance) but are also higher risk because the debt is unsecured. With an auto or home loan, the note is secured by collateral. Many experts prefer mortgage notes when investing in notes because they are a relatively safe options with the potential to make high profits over time.

2. Consider buying non-performing notes. A non-performing note is a note that is in default, meaning the borrower is not making payments on the debt. Non-performing notes can often be purchased at discounted rates and can be rehabbed. Just like a fix and flip property, you can fix and flip a note by either re-negotiating the terms with the borrower, or foreclosing and selling the collateral. This is only an option if the note is a secured debt. Once the note is current again, you can sell the note and make a nice profit.

3. Always work with a financial professional. Investing in notes can be complicated and there are many different laws, regulations, loop holes, and other details that the average person doesn't know about. Use a broker or financial professional to help make sure your investment is secure.

If investing in notes sounds like a great investment strategy, that's because it is. It can be an effective way to earn high interest each month without having to worry about the ups and downs of the stock market. If you are ready to start investing in notes, call us at Level 4 Funding today! We specialize in alternative investment strategies and can help you every step of the way!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

How to Earn More and Work Less with Note Investing

Whether you know it or not, you are probably already involved in note investing but on the wrong side of it. Investing in notes is the process of buying debt in the form of credit cards, student loans, mortgages, or car loans. But instead of making payments, you collect payments from the borrower, which include a higher than average interest rate.

Many investors think that note investing sounds too good to be true, or may even think it is a scam. This could not be further from the truth. Note investing is simply the process of purchasing debts that borrowers owe. Once you purchase the debt, you earn interest each month until the debt is paid in full by the borrower. This interest can range anywhere from 3% on a mortgage note to well over 15% on a debt like a credit card. The interest rate is not subject to changing market conditions so you earn the same rate over the life of the loan, which can be anywhere from a few months to 30 years, depending on the terms of your investment.

While there are many types of note investing like credit cards or car loans, there are some specific advantages that come with investing in real estate notes. Investing in notes that are tied to the real estate market is very similar to trust deed investing. Basically, you purchase a mortgage debt from a bank. The bank benefits because there is less of a risk of loss in the case of default because it has capital from you. You benefit because you can now start earning the interest that is paid by the borrower each month. While this may be a relatively low rate, it is usually a high payment due to the amount of money involved in the transaction. You can earn hundreds every month compared to a credit card note which may have a higher interest rate but generally a lower balance so the monthly interest payment is less.

Higher monthly payments makes real estate note investing one popular way to start investingin notes is to invest in real estate notes. In this situation you basically buy a promissory note that is part of a mortgage. You hold the note and earn interest. You receive payments each month until the mortgage is paid in full and then you get back your initial investment. You don’t have to work for your payments, you sit back and let the cash flow in.

Risks and Benefits of Non-Performing Notes

Real estate note investing also has an extra opportunity for smart investors to earn high returns, non-performing notes. A non-performing note is exactly what it sounds like, a debt that is currently not being paid. When a mortgage is not being paid, the bank has two options, foreclose on the property or sell the note to an investor. While several years ago foreclosure was the first choice, many banks are now opting to sell non-performing notes.  By selling the note rather than going through the expensive and sometimes drawn out process of foreclosing, a bank stays out of the chain of title, doesn’t become liable for the property’s environmental conditions and doesn’t have to worry about ownership issues. The sale of non-performing notes is a cheaper alternative to foreclosure.

Once you own a non-performing note, you basically fix up the note the same way you would fix up a property. You can renegotiate the terms of the note with the borrower if you goal is long term monthly payments and interest earning. Or, if you would prefer to own the actual property that you hold the note on, you can foreclose on it and take possession. From here you can rent it out, fix and flip it, or hold onto it until it appraises for the amount you want to sell it for. Regardless of which avenue you take, you will make a profit on your non-performing note.

The greatest risk with non-performing notes is that you will lose money during foreclosure. You can help make this less likely by knowing all the laws related to foreclosure in the state where you own the note. Make sure to take into account any extra expenses the foreclosure process may entail.

Call us today to get started with note investing and non-performing notes!

At Level 4 Funding, we specialize in alternative investment strategies like investing in notes. We can help you through the process to help you start working less and earning more!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Pitfalls of Trust Deed Investing and How to Risk Less

Many homeowners think the only people involved in their mortgage are them and the bank. However, this is not usually the case as most loans also have a trustee who has engaged in the process of trust deed investing as a way to build an investment portfolio.

Trust deed investing is generally considered a relatively safe investment because it is backed by real property than can be used as collateral in the event of default. However, like any investment there are risks. Namely, deeds of trust are not insured by the FDIC so there is not guarantee that you will get your money back. Also, if the borrower declares bankruptcy then the home cannot be easily foreclosed on without a lengthy legal process. Depending on the outcome of this process, it is possible to lose some or all of your investment.

These risks are not unique to trust deed investing as every type of investment does have some inherent risk. There are a few ways to minimize these risks and maximize your profits. First and foremost, work with a private lender or equity firm that is experienced in trust deed investing. Make sure that your lender has loaned on deeds of trust before and can explain the process to you, including any and all risks.

You can also help mitigate risks by doing your due diligence. Research a property’s title status and market value. This will help you make sure there are no issues with the title that would prevent a foreclosure. Knowing the market value will help you ensure that the property will be worth the amount of the loan or more in the event of default. This is especially important because the bank will get paid back before you do so you want to be sure there is enough money to recoup your investment. Sound intriguing and want to know more? Keep reading to learn the ins and outs of trust deed investments and how you can get started today!

How Trust Deed Investing Works

When you buy a property in Arizona and finance through a bank like Wells Fargo or Bank of America, most people think the bank holds the deed to the property. This is not the case. Usually someone’s grandma in Oklahoma or an investment banker in New York purchases a promissory note, funds your loan, and retains the legal title to the property. Sounds complicated, but really it is not, it is all part of trust deed investments.

The investor in trust deed investments purchases an interest in a mortgage through a promissory note. The investor can purchase the full mortgage or a part of it. If the investor purchases the full deed, he/she must have enough capital to fund the whole mortgage. If a fraction is purchased then the investor puts up a fraction or percentage of the value of the mortgage or promissory note. In this case the investor has the option to purchase a first or second deed of trust. A first deed of trust means that the investor is first in line to be paid back in the event of default while a second deed investor is more at risk for losing his money.

Once you have purchased trust deed investments, you officially hold an interest in the mortgage. You also hold the legal title to the property on behalf of the bank (the borrower retains possession of the physical property). Each time the borrower makes on time payments, you earn interest from the bank. The interest rates on trust deed investments are often higher than the interest rates on stocks and bonds. Once the loan is paid in full either by sale or after the mortgage term, you get your initial investment back. Basically, the bank pays you to hold onto a piece of paper for them.

But why? This is the main question that holds many people back from trust deed investing. Why would the bank pay you interest to hold a paper for them? The reason has to do with foreclosure procedures in the event of default. The bank cannot hold the title to a property so if there is no trustee, the borrower retains both the legal and physical tittle to the property. If the borrower defaults, this makes it very difficult to foreclose. If the legal title is held by a third party, a trustee, the trustee can foreclose on behalf of the bank, making the process much quicker for the lender.

Trust Deed Investing is a Win-Win for the Investor and the Bank!

Learn more about this lucrative investment strategy by calling a private lender or equity firm today! While trust deed investments are safe when done correctly, loop holes and other paperwork issues can get in the way. Make sure you use a financial professional to help you navigate the world of trust deeds!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Risks and Benefits of Trust Deed Investing

Trust deed investing can provide substantial rewards with minimal risks for investors. There are a few different ways to get started in trust deed investing and finding the right financial professional to help you can make all the difference.

Most investors know about stocks, bonds, and real estate investing. Real estate investing can be a very lucrative way to build your investment portfolio. You can invest in real estate in a number of ways like buying a fixer-upper, or purchasing a home to rent out. While almost everyone knows about making money on a fix and flip or as a landlord, there is another, less common type of real estate investing called trust deed investing. Trust deed investing involves three parties, the borrower, the bank, and the trustee. If you are investing in deeds of trust, your role is that of the trustee and you act as an intermediary between the borrower and the lender. You hold the legal title to the property until the loan is paid off or unless there is a foreclosure.

While you can earn back your investment in the event of a foreclosure, the real benefit of trust deed investing is when all is going well. The bank or lender will pay you interest rates into the double digits to hold the title to the property. As long as the borrower is making on time payments, you are earning interest every month. Once the loan is paid in full, you also get your initial investment back. You can purchase deeds of trust through a private lender or other investment professional.

As the trustee, your job is basically to protect the lender in the event of default. If the borrower defaults on the loan, the lender would have to take the borrower to court and could not foreclose on the property until after a lengthy legal process. By using a trustee, the lender has a second option. The trustee can foreclose on the property on the lender’s behalf and help the lender recoup its investment. In the event of a foreclosure, some of the sale proceeds go to you as the trustee to help recoup your investment as well.

How to Make Money and Grow Your Wealth

If trust deed investing sounds intriguing, there are a few ways to get started. The first and most important step is to find a private mortgage company or investment firm that loans on promissory notes. From here, you should be able to decide how much you want to invest. You can purchase an entire deed as a single investor. This is one of the safest ways to invest because you are the only investor that needs to be paid back in the event of default.

If investing in the full deed is out of your budget, there are still ways to get into trust deed investing. You can invest as a fractional investor and buy a portion of the deed. If this is your plan, finding the right broker is crucial. Depending on whether you are the first investor, your investment may be less safe. Your investment professional can work with you to explain how to purchase a first deed of trust vs. a second deed of trust. This is important because a first trust deed holder is the first investor paid back in the event of default. If you are a second deed holder, you are at a higher risk for losing some or all of your investment.

Your private lender should be able to fully explain all of the risks to you and help you make the right choice when it comes to trust deed investing.

If trust deed investing sounds like a good fit for you, call a lender today!

Here at Level 4 Funding we specialize in deed of trust lending and other types of alternative investment and funding options. You won’t find trust deed investing by walking into your local bank so you need a private lender like Level 4 Funding. We know that trust deeds are not an investment that many people take advantage of and we know how much money you can make by doing so. We will be here every step of the way to answer your questions and help grow your money. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Investing in Non-Performing Notes: A Win-Win for Borrowers and Investors

Investing in notes is a relatively safe investment strategy that pays consistently high interest rates with low risks. While note investing can yield high returns, investing in non-performing notes can have even bigger payouts. However, there are more risks involved in non-performing notes so it is important for investors to be aware of all risks and benefits.

Have you ever heard of investing in notes? Probably not, but you are most likely already doing it. If you have a credit card, car payment, student loan, or mortgage, you are in the note investing business. But, you are on the wrong side of it. You are paying interest on a note to a bank or note holder instead of earning high interest rates by being the bank. When you purchase a note you become the bank and have many of the advantages like high interest rates and security that the bank has. This includes the ability to renegotiate the terms of the note in some cases, earn higher than average interest rates, and have a consistent interest income that is not dependent on market conditions. If this sounds like it is too good to be true, it is not. Note investing is a little known but very legitimate type of investment that money savvy investors and banks take advantage of regularly.

One popular type of note is a real estate note. Real estate notes are generally safe investments because they are backed by actual physical collateral, the property that they represent the title to. Real estate note investing also has an extra opportunity for smart investors to earn high returns, non-performing notes. A non-performing note is exactly what it sounds like, a debt that is currently not being paid. When a mortgage is not being paid, the bank has two options, foreclose on the property or sell the note to an investor. While several years ago foreclosure was the first choice, many banks are now opting to sell non-performing notes.  By selling the note rather than going through the expensive and sometimes drawn out process of foreclosing, a bank stays out of the chain of title, doesn’t become liable for the property’s environmental conditions and doesn’t have to worry about ownership issues. The sale of non-performing notes is a cheaper alternative to foreclosure.

Benefits for Investors and Borrowers

As an investor, you can purchase the non-performing note from the bank for a discounted price. Once the note is purchased, the investor goes about rehabbing the note to turn it into a performing note that can greatly increase in price. As the investor you have a couple options when it comes to rehabbing the non-performing note. You can work with the borrower to negotiate different loan terms. This is a good option if you don’t want to own the actual property but you want to earn monthly payments, including interest. It can also work out well for the borrower who can avoid foreclosure and further negative marks on his/her credit.

A second option to rehab a non-performing note is to foreclose on the property. This is a good option if you want to sell the property for a profit or if you are a developer looking for cheap land and buildings for a new project. This is only a good option if you want to own the actual physical property at a discounted price. Many experts advise that this can be a great strategy to get a multi-family or commercial property for much less than the appraised value.

Danger, Buyer Beware!

Like any investment, non-performing notes have some risks associated with the investment. You can help yourself risk less by taking a few critical steps to protect your investment:

·         Know the foreclosure laws in the state where you purchase the property. Some states require you to go to court and go through the process of judicial foreclosure with takes longer and can cost more money. If you are getting a great deal it may still be worth it, but it is important to know about all the issues upfront.

·         Get as much information about the physical asset as possible. Know the location, market value, condition, and any other pertinent details about the property.

·         If possible, get a home inspection and appraisal done prior to purchasing the note, especially if you want to own the actual property. This will help protect your money.

·         Find the right lender who knows the ins and outs of the non-performing note business. Not just any bank will do, make sure your financial professional understand note investing and has done it before.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

How to Be Successful and Make Money with Note Investing

Whether you know it or not, you are probably already involved in note investing but on the wrong side of it. Investing in notes is the process of buying debt in the form of credit cards, student loans, mortgages, or car loans. But instead of making payments, you collect payments from the borrower, which include a higher than average interest rate.

Many investors think that note investing sounds too good to be true, or may even think it is a scam. This could not be further from the truth. Note investing is simply the process of purchasing debts that borrowers owe. Once you purchase the debt, you earn interest each month until the debt is paid in full by the borrower. This interest can range anywhere from 3% on a mortgage note to well over 15% on a debt like a credit card. The interest rate is not subject to changing market conditions so you earn the same rate over the life of the loan, which can be anywhere from a few months to 30 years, depending on the terms of your investment.

While there are many types of note investing like credit cards or car loans, there are some specific advantages that come with investing in real estate notes. Investing in notes that are tied to the real estate market is very similar to trust deed investing. Basically, you purchase a mortgage debt from a bank. The bank benefits because there is less of a risk of loss in the case of default because it has capital from you. You benefit because you can now start earning the interest that is paid by the borrower each month. While this may be a relatively low rate, it is usually a high payment due to the amount of money involved in the transaction. Even at 3.5%, you can earn hundreds every month compared to a credit card note which may have a higher interest rate but generally a lower balance so the monthly interest payment is less.

Benefits of Real Estate Note Investing

As discussed above, high monthly payments are one key benefit of investing in notes that are related to real estate. In addition to high payments, there are several other benefits that are unique to real estate note investing.

1.       Borrowers are less likely to default completely on their home loan. While foreclosure does happen and is a risk, most borrower are emotionally tied to their home. Even if other debts end up being defaulted on, they are less likely to want to risk losing their home so a mortgage payment will often be a priority, even during times of financial stress.

2.       The note is backed by a real, tangible asset. In the event of default, the property can be foreclosed on and some of your investment can be recouped. This is simply not the case in many other types of note investing. Take credit cards for example, if a borrower defaults, his credit will be impacted but credit cards are unsecured debt, meaning that there are no physical assets that can be used to recoup your funds.

3.       Note investing can be very profitable. Especially if you buy a non-performing note and spend time to rehab it. This means you buy a note that is close to or in default and renegotiate the terms of the loan with the borrower to avoid foreclosure. You then earn interest and the note itself becomes more valuable. In some cases, these notes can be worth nearly 12% interest each month.

4.       Less competition. Investing in notes is a niche investment market. There are only a few private equity firms and hedge firms that use this investment strategy and the pool of individual investors is even smaller. This means no bidding wars and often puts you in a great position to negotiate price and terms.

5.       Easy, passive investing. You can have a financial company manage your note for you for a flat fee that is usually quite small. In addition, if the note is performing there is almost not managing necessary. You get to sit back and earn money every single month.

Call Level 4 Funding to learn more about investing in notes today!

Note investing is a great strategy to build your investment portfolio and has the potential to help you earn big bucks. Call us today to get started!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027