The Current Recession and Mortagage Foreclosure Essay

The Current Recession and Mortagage Foreclosure Essay

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The current recession and mortgage foreclosure crisis has opened unprecedented real estate opportunities. One hundred and fifty thousand dollars in cash, if used right, could yield substantial long and short term returns. The first step I would take is to do a financial audit. I would try to clear all negative debts that could adversely affect my credit score and debt to income ratio. I would keep my debt to income ratio below 30%; in this market banks feel comfortable loaning to you below this ratio. Upon graduating with a bachelor’s degree in nursing I would make approximately $65,000 a year. Having worked in the medical field for sixteen years banks can see I have job stability. I would deposit my check into Bank of America, allowing ample time for the check to clear. I would then research the area I would like to live in. I would search for a home that is in a favorable location. The home would have three to four bedrooms, two to three bathrooms and at least a two car garage. It should be in an area where most residents own their home. We must think of the homes future resale value. We would have to buy the home at no more than 60% of its current value this figure should include repairs if needed. I would not spend more than 70% of the cash I have on hand. In this case $105.000, leaving $45,000 for incidentals. I would buy the home for cash and move in to it as soon as it was habitable. After making all necessary repairs I would refinance using an FHA loan (as I would make this my primary residence). I would take out about $90,000, with current FHA rate at 4.75% this would be about $470.00 monthly. Taxes and insurance we can figure about $700.00 monthly. Now we start researching potential rental properties. I would try t...

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... in a high interest bearing account. I can either cash out or continue to wait for the best time to cash out on my investments. The key is research, research, research. You must formulate a game plan and stick to it no matter what. You cannot fall in love with any property they are tools to make you money and that’s all. Keep up with the numbers so you know when to sell. If the value of your property y falls or rises above your preset values you must sell! With the proper research and the right team of people you can make big profits with real estate. Having a $150,000 head start should insure success. Always have cash on hand for emergencies/ unforeseen expenses they pop up when you least expect them. Thank you for the time you spent reading my information. I hope this essay exceeds your expectations allowing me to pursue my degree using your generous contribution.

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