What really happens when smart people make dumb real estate investing decisions?
How can bright professionals suddenly find themselves losing thousands of dollars because they didn’t check out something as simple as a soil test for a septic tank?
It can happen. In fact, it does happen all the time.
Tim Simmons has some priceless information about how to avoid such real estate investing traps. He tells about a couple that got entangled in a speculative deal because they trusted their lender will all the details.
As Simmons points out, your lender can do a lot of research for you when you buy a house but don’t count on that same care and attention for a vacant lot in a new subdivision which may, or may not catch on with future buyers.
For example, Quentin Haning thought he was getting a good deal buying two lots in a Pinehurst, North Carolina development.
He was later shocked to find out the properties could not handle a septic system. To make matters even worse, the lender had made his loan a personal loan rather than the mortgage he thought he was getting.
Folks, this is a major trap. Do your own homework and get the facts. You really can’t depend on anyone else to get it right. Don’t let the lack of due diligence and research cause these real estate investing mistakes to happen to you.
In my opinion I believe this is probably the second biggest reason why formally enthusiastic investors get out of real estate. Make 2008 your year of due diligence.