Dc Fawcett Reviews Buydown Mortgage



A buydown mortgage is something in which the buyer buys down a loan. He obtains a lower interest rate and lowers the monthly payments. In this article, Dc Fawcett, an expert in wholesaling, rehabbing and cash flow investing, reviews a buydown, the types of buydowns and the benefits of a buydown.


The buydown mortgage works by depositing cash estimated by calculating at the buydown percentage  in advance. The bank or the lender then reduces the interest rates and hence the monthly payments. For instance: you are taking a 30 year old mortgage for $ 30,000 for a rate of interest 5%. You can pay a 1% extra upfront fees and the lender lowers the rate of interest by 0.25%. The rate of interest then diminishes by 1/4. This helps you save money in the monthly payments and helps you plan ahead.

2-1 buydown

A 2-1 buydown is a Mortgage where the interest rates are lowered in the first 2 months and then it becomes a fixed rate mortgage. The interest rate increases step by step and becomes constant after the first 2 months.

A 3-2-1 buydown

A 3-2-1 buydown is a technique in which the interest rates are lowered by 3%, 2% and 1% in the first 3 consecutive months. They increase in this slow fashion and then become constant. This 3-2-1 buydown mortgage is extremely beneficial to the buyers. They can save money for the increased monthly payments ahead. The fact that the interest rate becomes fixed after 3 years helps them plan ahead by looking at their present monthly income and saving for the future.

What should you consider before you take a buydown

Before you take a buydown, it is important to estimate over what time you can earn back the interest bought down. Suppose you pay a buy down amount of $25000 for a mortgage, then you should be able to estimate after how much time you can get this money back. The decision to take a buy down also depends upon how long you are going to stay in that home.

Benefits of a buydown

A home builder or seller offers the buy down sometimes. He allows a buy down for a fixed period or for the entire mortgage. This allows the home buyers who cannot afford heavy downcash or those who cannot pay high monthly payments to become eligible for the loan. This type of buy down is usually a no cost mortgage interest rate buydown. Another important benefit of a buy down is that the down payment can be deducted from tax. This down payment comes down as mortgage points and can be debited from tax only in the same year as it is being paid for house purchase.


By reading this review by Dc Fawcett, a virtual real estate investing expert, you can get immense insight into the various aspects of a buydown. Fawcett is the owner of virtual real estate investing systems in which he gives tips to expand people’s real estate investments. He invests in areas which he does not live in and is a virtual real estate investing whizz and mentor.








DC Fawcett – What Is Flipping House?


What Is Flipping House

Mistakes that new house flippers do and what they should know :

What is flipping?

When you involve in flipping house real estate property you purchase it for a low price and then eventually resell the property for a higher price. DC Fawcett says This is done within a short tenure. While in some instances you enhance the house you may also leave the property as it is in other instances. In the second case another investor gets interest in the property.

Property flipping is a famous practice in the world of real estate. Flipping should be carried out in an ethical and legal manner and all the representations of the house condition should be correct. The value of the property should also be accurate.

Now let’s go over certain aspects of flipping:

  • At the initial stages of flipping several flippers doesn’t have sufficient knowledge about the cost it takes to renovate a house. So they budget an amount that may not be correct. The problem is estimating repair costs in the most correct manner.

  • Repair costs may spring suddenly when you have started to renovate the house and you have to contemplate upon the hidden repairs in the initial stage itself.

  • You would have spent lot of time in flipping and would have expended a huge sum. So it is natural that you desire to sell of your property in a swift manner.

  • You may think that through flipping is a get-rick-fast method. But you have cognizant of the fact that similar to other type of long-term investment it requires perseverance.

  • Sometimes several house flippers will associate with another investor while in the process of flipping houses. It may be that while one investor deals with the cash transactions including paying the sum, another one will scout for the deals. In fact, the second person will be carrying out maximum work. Partnering can be a viable option if there is clarity of job and written agreement is available. Why do real estate investors endeavor in partnering? This they do so to share the risk. Having said that, it is not wise to enter into partnership on a real estate deal. When the partners have well-defined roles then this can be considered.

  • One should get the help of the right contractor while flipping. See to it that the contractors don’t raise prices, get the help of wrong individuals etc.

  • We should supervise the contractors and see that they are efficient and working in the limit of the budget. Ensure that you keep a watch on them in a thorough manner and before paying them more money see to it that they have done the previous work correctly.

There was a time when there was no problem with the legality of flipping. House flippers were in a position to make lot of money finding property bargains and also taking them to the notice of prospective buyers. Owing to the usual stagnancy of the market certain individuals made huge sum flipping properties. Then the home market value started rising in a sudden manner and wrong people entered into real estate field.

Conclusion :

There were also certain people of the real estate flipper industry who involved in illegal activities including making the appraisers to raise the value of the property in a false manner. Also they involved in faking the required documents.So the key is to carry out the flipping activities in the right manner.

DC Fawcett is proficient in Virtual Real Estate Investing; one can know about how to develop their business and to build different income streams.





DC Fawcett Real Estate – The Questions To Put Forth While Purchasing A House




You may be having various questions in your mind regarding purchasing a house. Here then, the realty agent is supposed to tell the situation as it is. For this you have to put forth the appropriate questions.

The markets will not remain the same. Sometimes it may be in favor of the seller; sometimes in favor of the buyer. According  to DC Fawcett It’s better to pose questions to your agent so that you gain knowledge about the nature of market.

Now let’s see some of the questions that the home purchasers should ask at the outset of purchasing the home.

  • You can ask questions about the offering price. You can ask about the span the property has been in the market, the amount the seller paid, the outstanding amount of the seller etc.

  • It is also good to explore about the condition of the property prior to buying. This includes the nature of foundation, the presence of insulation in the walls of the property etc.

  • The world of real estate revolves around location and it goes without saying that homes in nice areas have more value. You can also know about the demographics in the vicinity, the type of houses in the neighborhood, the location of the schools etc.

These are some of the questions that you can specifically ask to the professional agent.

  • You can ask the reason for the owner’s act of selling the property. It may be that the owner has some work in abroad and they have to leave the place for that.

  • When you have some doubts, you can ask the neighbors too so that you would be in a better position to know even the negative factors.

  • You can ask about the elements that the sale encompasses. This may include asking questions like the inclusion of garden shed.

  • When you come to know that the owners are shifting from the property after a short span you can know the reason.

  • You can also ask the agent regarding their prolific nature of their offers. When you know about the other offers you can easily cognize what sum you should give.

  • You can know the time when the sellers should relocate. It may happen that you have to wait because they didn’t find some other place to move in.

  • You can also find whether you can communicate with the sellers.

  • The availability of noisy neighbor is another important thing to be considered while purchasing a property.

  • You can ask the agent to elaborate on the Energy Performance Certificate.

The various online information centers may not provide you the correct estimate; it can only give a rough idea of value in your neighborhood. Agent CMA is another aspect wherein you get a comparative market analysis i.e it gives idea about the worth of your property.


One should remember that an online estimate cannot be an alternative for agent CMA. Also it cannot exactly take the place of an appraisal.

Dc Fawcett, the founder of the Virtual Real Estate Investing Club, has given a fair idea regarding these lingering questions about realty market scenario. You can get a clear idea by going through Dc Fawcett’s blogs and get an answer to your questions.








Dc Fawcett Guidelines – Net Operating Income In Real Estate


Dc Fawcett guidelines

When you invest in real estate properties, you need to know the method for calculating the property value when you are buying them. You can calculate the capitalization rate only when you use the property’s net operating income and recently sold prices. DC Fawcett gives you the guidelines about the net operating income in real estate.

Net operating income in real estate

It is a calculation that is used to analyze real estate investments which generate income. It is the result of the property revenue minus all the expenses incurred. In other words, it is gross operating income minus operating expenses. Apart from rent, you can also get income from parking and laundry machines. Operating expenses are the expenses that are needed to run and maintain the building or the property on its grounds. Insurance, property management fees, utilities, property taxes, repairs, and janitorial fees are these expenses. NOI is the operating income before tax. Principal, interest payment on loans, capital expenditure, depreciation, and amortization are not included in it.

Formula for NOI is as follows in case of rental income is

Net operating income formula

Net operating income is positive when gross operating income is more than operating expenses. It is negative the other way round. NOI can either be on the basis of historical financial statement data or projected financial statement data for the future.

It measures the capacity of the property to generate income from the income stream operation. The difference between cash flow before tax and net operating income is that former is calculated on a typical real estate proforma and the latter excludes any financing or tax costs that the owner incurs. In other words, it is unique to the property more than the investor.

How to calculate net operating income

Net operating income calculation is simple once you get the break-up amount of individual components. The components are

  1. Potential Rental income – Is the sum of all rents under the terms of each lease with an assumption that your property has been rented out and it is occupied. If it isn’t fully occupied, then a market-based rent is taken to consideration on lease rates and the terms of comparable properties.
  2. Vacancy and credit losses – It is the income lost from the tenants who have either vacated the property or have defaulted by non-payment of rent or lease. For the purpose to calculate NOI, the vacancy factor is calculated on the basis of current lease expirations as well as the market is driven figures with the help of comparable property vacancies.
  3. Effective rental income – The outcome of this is the result of potential rental income minus vacancy and credit losses. This is the income that the owner can expect to collect which is reasonable.
  1. Other income – This is the income the owner gets other than the rental income. They can get the income through billboard/signage, parking, laundry, vending etc.
  1. Gross operating income – it is the result of effective rental income plus other income that is generated from the property.
  1. Operating expenses – It includes all the expenses like property taxes, insurance, management fees, repairs and maintenance, utilities, and other expenses.
  1. Net operating income – It is the result of deducting operating expenses from gross operating income.


DC Fawcett concludes that Net operating income is as good as the net profit earned out of rental income or the property sale.








Dc Fawcett Real Estate – The Trick Behind Getting Rentals With No Price To Be Paid


Here is a story by an individual. The individual refinanced some of his rental properties in real estate and disposed about two.  He made huge amount of money disposing two rentals and earned a lot of money from the refinancing.  Because of the money he got as a return, he has not invested his own money in the remaining dozen of residences.  Of course, he had to put in a lot of investment to buy the residences and maintain them.  He has not made sure promises that he did not spend any money.  After the summer he was able to retain all the cash he put down on down payments and repairs.  Above all, he has retained more money from rental properties than he spent on purchasing them.


At what juncture one should refinance his rental property?

One among the viable options to retain money out of real estate investments is to go for refinancing.   But, when investment properties are refinanced, you would not be in a position to finance 75 or 80 percent of the value of the property.

Selling rental properties – why it is a viable option

Prices have had a steep hike in the market area, but the rents have not kept up to the rising prices.  Anybody would expect more cash flow on the rentals, and that is difficult when the prices are exorbitant.  One may buy a property in Colorado, but sell it out for two rentals.  The properties were sold because the individual did not prefer long term holds.  One investment property was a college rental duplex, and the other rental had an absurd plan of the floor which made it difficult to dispose.

Dc Fawcett Reviews – How much does one earn every month on rental properties

It is not only that an individual could earn money from buying and repairing the rentals, but also that he or she could earn monthly income. The individual could earn a profit of 500 dollars.  The individual made an analysis of his rentals a couple of years back, and his estimate was correct.

Not only that the individual makes 7000 dollars per month, but also that he is clearing his mortgages every month.

Future suggestions for rental property:

Many people love rentals because of the amount that the rentals could fetch them.  Also, it takes little money to purchase when compared to the assets that are yielded.  One is not going to purchase a property and assume that the value goes up.  One has to make sure that the rental properties that are purchased have steady income and probable appreciation of value.  One could consider purchasing property in other states or purchasing commercial properties in the vicinity.  There might be a plan to buy 100 rentals by another decade, but take care that you do not fall short of your goals.  One should not simply sit and wait for the change in market scenario, but should be skimming over properties like crazy.  When one finds more rentals, he or she will be in a good position to buy them.  And, thanks to the process of flipping through the properties.

Dc Fawcett, the owner of the Virtual Real Estate Investing Club, has many suggestions to offer in his blogs.  One could draw a fair idea regarding the present real estate market scenario as he reads through the blogs.  Also, by reading the blogs by Dc Fawcett, one would know how to purchase rentals without putting in own money.