Real Estate Investment Software

Note buyers are a great way to obtain financing for your next real estate investment. In contrast to the traditional mortgage broker, using a note buyer keeps the transaction private. This is a better route because you will not be sacrificing your personal or business credit to purchase the investment property. In fact, most note buyers do not report to credit bureau’. You might ask, “How can a note buyer take such a risk?”. Well, it’s not really a risk because the transaction contracts have their own set of rules that bypass state laws when a breach of contract occurs. A note buyer is not in the business of funding traditional mortgage loans that require an expensive foreclosure process. Having a note buyer or two on standby is vital to any real estate investor–unless the investor can fund the note themselves.

Note buyers pioneered–the buy a home with no money down revolution. Without note buyers, real estate investing and the real estate market would not have earned the lucrative business reputation that investing in real estate truly is.

Many newbies in the real estate investing business don’t realize how important a note buyer is to them. The overlooking of the role a note buyer plays in any real estate investment consideration is probably the single most reason new real estate investors fail in the business.

Learning how to depreciate rental property is a vital skill to have for any landlord or real estate investor. There are two depreciation methods available–the straight line method, and the double declining balance method–for an investor to choose between. Since every property paired with a real estate investor is financially unique, the investor should run the calculation both ways to find out which way works best for their situation. The current insured replacement cost will help an investor obtain the data values needed to run the calculation. The land value, structure value, and fixture values are all used when calculating depreciation–regardless of the depreciation method being used. The real estate investor would also need to get the state and federal tax rates as well. Once this information has been obtained, the calculations can be performed.

Depreciation formula for the straight line method:
Current Value – Salvage Value / Years left of productive life

Depreciation formula for the double declining balance method:
(Current Value - Salvage Value) * (2 * 100% / Years left of productive life)

Learning how to calculate the NPV–Net Present Value–is one of many valuable skills to have if you want to invest in real estate. The NPV helps a real estate investor analyze a properties profitability. Although, many investors consider the NPV to be unreliable. The NPV relies on projected future cash inflows which is impossible to accurately forecast. Even when an investor realizes the NPV’ reliability, it is still calculated because it provides a guess estimate. It would be beneficial to be as realistic as possible when inputting future cash flow values. A good way to do this would be by guessing a high and low realistic amounts, and using the number between the two. However, a good way to ensure your being realistic would be by keeping the high and low amounts as close together as possible.

I suggest using the built in formula in Excel, or other popular spreadsheet programs to calculate the NPV. Here is the formula used for calculating the NPV: =NPV(discount rate, cash flow values).