real estate finance - full book (500 pgs)

Installment sale a method of incometax reporting by

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: rties ordinarily depend upon the availability of satisfactory financing. Income Property Sales – Because of the importance of cash flow and leverage, income property sales are almost entirely dependent upon the arrangement of financing satisfactory to both the buyer and seller. This may involve: • • • Primary financing – First mortgage loans. Secondary financing, from the seller or outside lender. “Wrap–around” or all–inclusive trust deed – A method by which a seller may extend credit while selling property subject to an existing loan. Installment sale – A method of income–tax reporting by which a seller spreads capital gain tax over a period of time. Tax–deferred exchange – A method of exchanging a property rather than selling in order to postpone the capital gains tax. • • PROPERTY MANAGEMENT An understanding of financing is necessary in order to manage property in an efficient and profitable manner. This frequently involves arranging refinancing, secondary financing, or alternative financing. LOAN BROKERAGE Loan brokerage requires an understanding of the real estate mortgage market. The availability and cost of money affects demand. Supply and demand are basic elements which participate in determining value. Some real estate brokers find loan brokerage a profitable specialization. Prospective borrowers who understand financing can take 1-10 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 1. IMPORTANCE OF REAL ESTATE FINANCE better advantage of the many services available from loan brokers and mortgage bankers. LOAN TYPES There are two types of loans (“government participated” and “non–government participated)” available, with different limitations and qualifying criteria for each. Conventional loans are loans not backed up by government. Each of these will be discussed in details further in this book. Government backed–loans – These loans are made by approved institutions and mortgage companies and insured by the federal government. These loa...
View Full Document

This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.

Ask a homework question - tutors are online