A home enters pre-foreclosure when the mortgage loan defaults - usually after the owner has missed several months of payments. Once the lender files a notice of default, the owner is given a period of time, called a reinstatement period, to make good on the loan and get back on track. If, after the reinstatement period, the homeowner still has not paid up, foreclosure and the sale of the property (or its reversion back into the hands of the lending company) follows.

Homes can be purchased by a real estate investor during any stage of the foreclosure process. However, many feel that the most lucrative opportunity for an investor is the purchase of homes in pre-foreclosure. There are some real estate investors whose sole business is dealing in pre-foreclosures. Let’s examine the pre-foreclosure angle in more depth.

There are several major benefits to the owner who sells their house while it is in pre-foreclosure. For one, the owner is given a chance to sell the home and avoid default and foreclosure on their credit report. This allows them the option of making a fresh start, free of skeletons that might haunt them in their next home purchase. Further, by selling during the pre-foreclosure stage, the homeowner may even have a chance to walk away from the sale with a modest profit, especially if they strike a short sale deal.

The real estate investor benefits too. A short sale of a pre-foreclosure house allows the investor to purchase a home at a discounted rate from the lending organization. The lender, not wanting to be saddled with real property as a liability, is usually more than happy to negotiate some type of deal, and they will often settle for far less money than they are actually owed.

There is also the opportunity to take over payments from the original homeowner, known as buying a property “subject to.” Properties purchased in this manner stay in the homeowner’s name; the title is signed over after the investor pays off the loan under the requirements of the current mortgage. This is beneficial to the investor because it requires little out-of-pocket initially, and has no risk to their credit. Investors also save on appraisal and closing fees. This is a very powerful investing strategy, but it is often underutilized.

Foreclosure real estate investing is a great money making opportunity that involves little risk. Many homeowners in pre-foreclosure are scared, and are often praying for someone or something to rescue them from the sinking vessel. The investor must think of himself as a savior for both the lender and owner, stepping in to rescue an otherwise hopeless situation.

I want to help you grow your database, develop quality leads, continue to learn, and move properties! Get intstant access to 7 free secrets about foreclosure investing by shooting over to- http://www.4closuresecrets.com

3 Proven Ways to Convert Your Readers into Buyers

There are 3 main conversion models I’d like to go over with you today. In case you don’t know what a “conversion model” is, it’s simply online marketing’s jargon for “converting your visitor/potential buyer to a buyer.”

1-Step Sales Page: Shot in the Dark The first method is the 1-step sales process. This is where you simply kick someone over to a full blown salespage and you attempt to to sell on the spot. As Fernando and I teach in our Attraction Marketing Formula Boot Camp (newsletters 5 and 6, entitled “Will You Marry Me?” and “Can I Get Your Number?“) this is very much like a guy going up to a girl he’s never met in his life and asking her to marry him right then and there.

Not only will he most likely get a “NO” for an answer, he’d most likely also get a kick to the balls as the girl scream hysterically for help and calls for help. Yes… Fernando and I do live close to Hollywood, where freaks are a dime a dozen, so that scenario is VERY real.

(I’ll tell you when this is okay to use at the end of this article…)

2-Step Squeeze Page: Let’s Go Out First… The second method is one you are probably more familiar with if you’ve been around the Magnetic Sponsoring Community at all. It’s the exact system Mike Dillard uses to promote his products.

It simply involves putting up a capture page which gets the reader’s information in exchange for something of value before kicking them over to the salespage.

Think of it as a guy asking a girl out on a date (with the promise of a movie and a nice dinner), getting her to say yes, and THEN asking her to marry him at the end of that date. The key thing is the movie and the dinner of course, the “bribe” as we call it.

(Side commentary: geeze, we men sure are suckers eh? Or wait… is that the other way around?)

2-Step Reverse Squeeze Page: Impressed? Good, Want to Date Me Now? And the last but not least method is about bribing them upfront without asking for anything in return and hoping that they are so impressed that they’d give you their contact info so you can kick them over to the salespage.

It’s like posting a valuable piece of information (your bribe) right there on your capture page and at the end of that free lesson you ask for the opt in.

It’d be also like randomly buying a girl a drink at a bar and THEN going up to her to chit-chat. You only hope that she

1. Liked your drink enough to chat with you
2. Like YOU enough to want to chat with you or
3. It was one helluva strong drink!

Advantages & Disadvantages With the 1-Step Sales Page, you get only one shot. Either they love what you have to say on your salespage and take that leap of faith to trust you and buy from you, or they are lost forever. Realize that since their money is actually at stake now, people who are willing to do this are far less than those who would be willing to give up their contact information.

Again, think about a guy asking a girl to marry him right off the bat.

Can it EVER happen? Yes.

But the numbers are far less than if the dude asked girls to go out with him.

With the 2-Step Squeeze Page, you are asking for far less in the beginning - a simple name and email-address. On top of that, you are even offering something in exchange - your bribe. You’ll find that people are far more likely to opt-into your capture page than they would buy had you sent them straight to the salespage.

And realize that a person who may not buy from you today does not mean she will never buy from you. Maybe timing just wasn’t right. So with a squeeze page collecting her information, this allows you to ping her radar once in a while hoping you do catch her on a day when she’s finally ready and capable of buying.

The downside with the 2-Step Squeeze Page is if you are in an internet marketing savvy market, people know the tactics and some would vouch to just give you a fake email just to access your salespage, thereby skipping the entire “Squeeze Page” process.

This brings us to the 2-Step Reverse Squeeze Page process…

The 2-Step Reverse Squeeze Page is quite interesting. You are offering value right up front and letting your bribe do the talking. “Hey, if you like what you’ve seen so far, you should opt-in and get access to even MORE cool stuff!“

Rather than using the “curiosity” factor (which the reader knows can involve false promises) to draw people in, you are using something much more solid and tangible. Actual proof that you do know your stuff and you CAN help your reader. What you end up with is typically a higher quality list and a more responsive one at that. On top of that, you’ll end up with less spam complaints than the 2-Step Squeeze Page.

Of course, you run into the challenge of making sure your upfront bribe is worth its weight in gold and is something your market is looking for. Otherwise it’d be like sending over a Martini to a girl at a bar who doesn’t drink. STRIKE OUT, BUH-BYE!

Rule of Thumb The 1-Step Sales Page is really only for your warm market. This means if you already have a list of people you communicate with and people on that list know who you are and like your personality, message, product, or whatever it is about you, THEN you can send people straight to the 1-step sales page.

A working example would be Fernando and myself sending out an email telling folks on our list about a new relevant product we created that they should go nuts over. We wouldn’t need them to opt-in again since they are already on our list so we just kick them over to the salespage - leveraging the relationship we’ve worked so hard to establish already.

The 2-Step Squeeze Page is a great system for sure if your market lies outside of online marketing. The reason I say this is because those of us who are internet savvy and who knows capture pages inside and out KNOW that we can easily bypass the whole system if we say… give a false email address. Like any tactic, once it’s been around a while people learn it, know it, and figure out a way to beat it (on top of having a stigma towards it).

This is where the 2-Step Reverse Squeeze Page comes into the picture. Try offering something so irresistible that your reader has no choice BUT to opt-in just so she can get more.

Ultimately, the 2-Step Squeeze Page and the 2-Step Reverse Squeeze Page require split-testing on your behalf.

Last Words on Selecting Your Conversion Model Odds are if you are just getting started, you’ll want to go with the 2-Step Squeeze Page if for no other reason than the fact that it’s the easiest method of the 3. Then once you have a list and some results to show for, you can experiment with the other 2 methods.

To Affinity and Beyond,

Raymond Fong

Learn More About Raymond Fong and How He Can Help You Setup Your Own Self Funded Proposal by Clicking Here: Attraction Marketing Formula

If you are one of the many people who have been worrying about the steady increase of fuel prices, then it would certainly be better to start looking for alternative fuel sources. And if you would look at today’s trend in the market, it is quite clear that the fuel prices will not be decreasing anytime soon. Thus, it is only fitting to have more attention on the matter of biodiesel. But why biodiesel in particular? This is because biodiesel is a renewable fuel source and is very safe to use when it comes to environmental protection. This is precisely why there just might be a need to have a biodiesel plant operating in just about every state of America.

Just what are the positive effects that come with the usage of biodiesel? There are literally a lot. For one thing, you surely must have noticed how diesel-powered engines emit such black smoke in the long run. This one major downside comes with the use of diesel for fuel. However, this will no longer be a problem when you start using biodiesel. This is because biodiesel is fuel that burns in a very clean fashion. You will never see black smoke emitting from your car’s exhaust when you start using biodiesel.

It was in the latter part of the 1990s when the commercial production of biodiesel started. However, it was not just until recently that the construction of biodiesel plants has certainly caught the attention of a lot of people. Looking at the stats and figures, the operation and construction of the biodiesel plant actually shows so many significant benefits when it comes to both microeconomics and macroeconomics. And we are talking about both the rural and the commercial sector here! The benefits are even more promising when compared to those of the regular diesel plants!

Just by looking at the labor sector of America alone, the construction of such plants can bring forth roughly 39,000 jobs. These are permanent job positions made available for the local communities all over America, and this figure is just an estimate with the target year of 2015. This figure could very well rise during the passing years!

More importantly, the operation of these plants can reduce America’s dependence on crude oil imports coming from oil-producing countries, especially in the Middle East. With 2015 as the target year still, an estimated 240 million barrels of oil can be scrapped down, should biodiesel be in full production all over America. In this alone, the operation of a biodiesel plant will indeed be very beneficial.

Having a biodiesel plant can help you cut fuel cost, save on gas and the environment. Make sure to consult biodiesel specialists before you make that decision to switch.

Also, by making biodiesel at home you become more self reliant and have better control of your fuel consumption.

Everyone who starts a business and work from home always have a desire to succeed. You will surely not like to fail in your endeavor to prosper in a working at home business. Hard work and dedication alone are not a guarantee to success in case of a home business. It takes that something extra to be successful. You may take down some important tips to make a success of your home business.

Management Issues Related With Working From Home

1. Plan: Make a comprehensive plan to protect your home business from all kinds of contingencies like natural disasters to unforeseen financial problems. This will make you tide over a tough situation.

2. Have funds: Do not start work at home under the impression that it will give you immediate returns. Have some extra funds ready for home business expenses till you start making money.

3. Time Management: You need to manage your time efficiently and productively to make sure progress in your home business. Remember that old maxim - ‘Do not put it off till tomorrow what you can do today’.

4. Space Management: You may have to run your small business in a room with limited space. So, you will need to place all your stuff in an orderly manner to make retrieval, in time of need, easy.

5. Focus: Do not let other distractions like family matters and leisurely activity wean you away from your point of focus. You know what you started the business for. So, stay focused.

6. Advertise: Be a go getter. Advertise your home business to reach out to more customers. Don’t treat it as a recurring expense. Advertisement is an investment that pays handsomely in both the short and long run.

7. Equipment: You need to have all the relevant equipment required to run your home business. There is no point wasting your precious time and energy running around to get things done from another source.

8. Insurance: Do not expose your inventory to risk. Buy the necessary insurance cover to protect it against a disaster. Though such disasters are rare, but when they strike they can paralyze your home business.

9. Be Positive: All small home businesses take time to prosper. Small businesses, however, take lesser time. But, you will have to be patient and positive during the formative stages of your business. Remember, you are not going to turn it into a success overnight.

Dave Clark is a freelance article writer and has been in the industry for many years, he has written many books and is very knowledgeable in various fields, Dave also works for Cushy Sofa a supplier of memory foam mattresses, sofas and Divan sets.

Becoming a copywriter starts for real the second AFTER you’ve gotten your first copywriting job.

Now don’t worry, all of the skills that you needed to get the job will still be very much in play…but those skills, as you’re about to find out, were only a prelude to the real day to day aspects of becoming a copywriter:professional style.

For instance, while it may have HELPED to have been aware of what was happening in the world while you were putting your perfect portfolio together, it is a MANDATORY to do so once you start your new gig.

As absolutely crazy as this is about to sound, you must plug yourself in to popular culture like you never have before. You must know who Paris is dating at the time, you must be aware of a new platform that Itunes is about to release, you must know who the last 3 winners of American Idol were (do you?)

Why?

Because you, my new copywriter friend, are now RESPONSIBLE for knowing these cultural highlights. It is now part of your job to know the most recent, the most popular, and the most relevant popular happenings.

Becoming a copywriter demands it. So don’t head into your first job with just the last ten One Show Award Show Books and start burying your head in them and nothing else.

Start ALSO reading Star Magazine and National Enquirer. Put Dancing With The Stars on your Tivo. Change your updates for Netflix and put on the top ten most requested new movies and make sure you watch them.

Does this sound a bit nuts to you? It shouldn’t. Because as a new copywriter, your bosses and especially your clients are going to EXPECT AND NEED you to know this stuff inside and out. You are about to become a conduit for them to know and to be able to tap into ‘what’s hottest’ at the moment.

Is Fabio making a comeback (I Can’t Believe It’s Not Butter) is Ellen Degenerous going to renew her daytime talk show contract (American Express)?

You are supposed to know these things. Because they will come up.

Clients want to siphon off popularity. And becoming a copywriter now means that it is PART OF YOUR JOB to have knowledge of that popularity.

So, if you don’t know what number case held the $1 Million Dollar prize on the Special Thanksgiving Show which absolutely killed in the ratings for NBC, then you’d better start knowing. Because right now, someone else is becoming a copywriter better than you are.

Kevin Browne is a former Creative Director and Senior Copywriter at agencies including J Walter Thompson, McCann Erickson and Young and Rubicam. Kevin now runs WhitehavenWeb.com where he shows web owners how to FINALLY make more money with my site

Planning to purchase or finance Commercial or Industrial Real Estate? Shopping Center? Office Building? Restaurant/Banquet property? Parking Lot? Storefront? Gas Station? Manufacturing facility? Warehouse? Logistics Terminal? Medical Building? Nursing Home? Hotel/Motel? Pharmacy? Bank facility? Sports and Entertainment Arena? Other?

A KEY to investing in commercial real estate is performing an adequate Due Diligence Investigation to assure you know all material facts to make a wise investment decision and to calculate your expected investment yield.

The following checklists are designed to help you conduct a focused and meaningful Due Diligence Investigation.

Basic Due Diligence Concepts:

Commercial Real Estate transactions are NOT similar to large home purchases.

Caveat Emptor: Let the Buyer beware.

Consumer protection laws applicable to home purchases seldom apply to commercial real estate transactions. The rule that a Buyer must examine, judge, and test for himself, applies to the purchase of commercial real estate.

Due Diligence: “Such a measure of prudence, activity, or assiduity, as is proper to be expected from, and ordinarily exercised by, a reasonable and prudent [person] under the particular circumstances; not measured by any absolute standard, but depending upon the relative facts of the special case.” Black’s Law Dictionary; West Publishing Company.

Contractual representations and warranties are NOT a substitute for Due Diligence.

Breach of representations and warranties = Litigation, time and money.

WHAT DILIGENCE IS DUE?

The scope, intensity and focus of any due diligence investigation of commercial or industrial real estate depends upon the objectives of the party for whom the investigation is conducted. These objectives may vary depending upon whether the investigation is conducted for the benefit of (i) a Strategic Buyer (or long-term lessee); (ii) a Financial Buyer; (iii) a Developer; or (iv) a Lender.

If you are a Seller, understand that to close the transaction your Buyer (and its Lender) must address all issues material to its objective - some of which require information only you, as Owner, can adequately provide.

GENERAL OBJECTIVES:

(i) A “Strategic Buyer” (or long-term lessee) is acquiring the property for its own use and must verify that the property is suitable for that intended use.

(ii) A “Financial Buyer” is acquiring the property for the expected return on investment generated by the property’s income stream, and must determine the amount, velocity and durability of the revenue stream. A sophisticated Financial Buyer will likely calculate its yield based upon discounted cash-flows rather than the must less precise capitalization rate (”cap rate”), and will need adequate financial information to do so.

(iii) A “Developer” is seeking to add value by changing the character or use of the property - usually with a short-term to intermediate-term exit strategy to dispose of the property; although, a Developer might plan to hold the property long term as Financial Buyer after development or redevelopment. The Developer must focus on whether the planned change is character or use can be accomplished in a cost-effective manner. A developer conducting due diligence will focus on issues involving market demand, access, use and finances.

(iv) A “Lender” is seeking to establish two basic lending criteria:

1. “Ability to Repay” - The ability of the property to generate sufficient revenue to repay the loan on a timely basis; and

2. “Sufficiency of Collateral” - The objective disposal value of the collateral in the event of a loan default, to assure adequate funds to repay the loan, carrying costs and costs of collection in the event forced collection becomes necessary.

The amount of diligent inquiry due to be expended (i.e. “Due Diligence”) to investigate any particular commercial or industrial real estate project is the amount of inquiry required to answer each of the following questions to the extent relevant to the objectives of the party conducting the investigation:

I. THE PROPERTY:

1. Exactly what PROPERTY does Purchaser believe it is acquiring?

(a) Land?

(b) Building?

(c) Fixtures?

(d) Other Improvements?

(e) Other Rights?

(f) The entire fee title interest including all air rights and subterranean rights?

(g) All development rights?

2. What is Purchaser’s planned use of the Property?

3. Does the physical condition of the Property permit use as planned?

(a) Commercially adequate access to public streets and ways?

(b) Sufficient parking?

(c) Structural condition of improvements?

(d) Environmental contamination?

(i) Innocent Purchaser defense vs. exemption from liability

(ii) All Appropriate Inquiry

4. Is there any legal restriction to Purchaser’s use of the Property as planned?

(a) Zoning?

(b) Private land use controls?

(c) Americans with Disabilities Act?

(d) Availability of licenses?

(i) Liquor license?

(ii) Entertainment license?

(iii) Outdoor dining license?

(iv) Drive through windows permitted?

(e) Other impediments?

5. How much does Purchaser expect to pay for the property?

6. Is there any condition on or within the Property that is likely to increase Purchaser’s effective cost to acquire or use the Property?

(a) Property owner’s assessments?

(b) Real estate tax in line with value?

(c) Special Assessment?

(d) Required user fees for necessary amenities?

(i) Drainage?

(ii) Access?

(iii) Parking?

(iv) Other?

7. Any encroachments onto the Property, or from the Property onto other lands?

8. Are there any encumbrances on the Property that will not be cleared at Closing?

(a) Easements?

(b) Covenants Running with the Land?

(c) Liens or other financial servitudes?

(d) Leases?

9. Leases?

(a) Security Deposits?

(b) Options to Extend Term?

(c) Options to Purchase?

(d) Rights of First Refusal?

(e) Rights of First Offer?

(f) Maintenance Obligations?

(g) Duty on Landlord to provide utilities?

(h) Real estate tax or CAM escrows?

(i) Delinquent rent?

(j) Pre-Paid rent?

(k) Tenant mix/use controls?

(l) Tenant exclusives?

(m) Tenant parking requirements?

(n) Automatic subordination of Lease to future mortgages?

(o) Other material Lease terms?

10. New Construction?

(a) Availability of construction permits?

(b) Utilities?

(c) NPDES (National Pollutant Discharge Elimination System) Permit?

(i) Phase 2 effective March 2003 - Permit required if earth is disturbed on one acre or more of land.

(ii) If applicable, Storm Water Pollution Prevention Plan (SWPPP) is required.

II. THE SELLER:

1. Who is the Seller?

(a) Individual?

(b) Trust?

(c) Partnership?

(d) Corporation?

(e) Limited Liability Company?

(f) Other legally existing entity?

2. If other than natural person, does Seller validly exist and is Seller in good standing?

3. Does the Seller own the Property?

4. Does Seller have authority to convey the Property?

(a) Board of Director Approvals?

(b) Shareholder or Member approval?

(c) Other consents?

(d) If foreign individual or entity, are any special requirements applicable?

(i) Qualification to do business in jurisdiction of Property?

(ii) Federal Tax Withholding?

(iii) US Patriot Act compliance?

5. Who has authority to bind Seller?

6. Are sale proceeds sufficient to pay off all liens?

III. THE PURCHASER:

1. Who is the Purchaser?

2. What is the Purchaser/Grantee’s exact legal name?

3. If Purchaser/Grantee is an entity, has it been validly created and is it in good standing?

(a) Articles or Incorporation - Articles of Organization

(b) Certificate of Good Standing

4. Is Purchaser/Grantee authorized to own and operate the Property and, if applicable, finance acquisition of the Property?

(a) Board of Director Approvals?

(b) Shareholder or Member approval?

(c) If foreign individual or entity, are any special requirements applicable?

(i) Qualification to do business in jurisdiction of the Property?

(ii) US Patriot Act compliance?

(iii) Bank Secrecy Act/Anti-Money Laundering compliance?

5. Who is authorized to bind the Purchaser/Grantee?

IV. PURCHASER FINANCING:

A. BUSINESS TERMS OF THE LOAN:

What loan terms have the Purchaser, as Borrower, and its Lender agreed to?

(a) What is the amount of the loan?

(b) What is the interest rate?

(c) What are the repayment terms?

(d) What is the collateral?

(i) Commercial real estate only?

(ii) Real estate and personal property together?

(e) First lien? A junior lien?

(f) Is it a single advance loan?

(g) A multiple advance loan?

(h) A construction loan?

(i) If it is a multiple advance loan, can the principal be re-borrowed once repaid prior to maturity of the loan; making it, in effect, a revolving line of credit?

(j) Are there reserve requirements?

(i) Interest reserves?

(ii) Repair reserves?

(iii) Real estate tax reserves?

(iv) Insurance reserves?

(v) Environmental remediation reserves?

(vi) Other reserves?

(k) Are there requirements for Borrower to open business operating accounts with the Lender? If so, is the Borrower obligated to maintain minimum compensating balances?

(l) Is the Borrower required to pledge business accounts as additional collateral?

(m) Are there early repayment fees or yield maintenance requirements (each sometimes referred to as “pre-payment penalties”)?

(n) Are there repayment blackout periods during which Borrower is not permitted to repay the loan?

(o) Is there a Loan Commitment fee or “good faith deposit” due upon Borrower’s acceptance of the Loan Commitment?

(p) Is there a loan funding fee or loan brokerage fee or other loan fee due Lender or a loan broker at closing?

(q) What are the Borrower’s expense reimbursement obligations to Lender? When are they due? What is the Borrower’s obligation to pay Lender’s expenses if the loan does not close?

B. DOCUMENTING THE COMMERCIAL REAL ESTATE LOAN

Does Purchaser have all information necessary to comply with the Lender’s loan closing requirements?

Not all loan documentation requirements may be known at the outset of a transaction, although most commercial real estate loan documentation requirements are fairly typical. Some required information can be obtained only from the Seller. Production of that information to Purchaser for delivery to its lender must be required in the purchase contract.

As guidance to what a commercial real estate lender may require, the following sets forth a typical Closing Checklist for a loan secured by commercial real estate.

Commercial Real Estate Loan Closing Checklist

1. Promissory Note

2. Personal Guaranties (which may be full, partial, secured, unsecured, payment guaranties, collection guaranties or a variety of other types of guarantees as may be required by Lender).

3. Loan Agreement (often incorporated into the Promissory Note and/or Mortgage in lieu of being a separate document)

4. Mortgage [sometimes expanded to be a Mortgage, Security Agreement and Fixture Filing]

5. Assignment of Rents and Leases

6. Security Agreement

7. Financing Statement (sometimes referred to as a “UCC-1″, or “Initial Filing”)

8. Evidence of Borrower’s Existence In Good Standing; including

(a) Certified copy of organizational documents of borrowing entity (including Articles of Incorporation, if Borrower is a corporation; Articles of Organization and written Operating Agreement, if Borrower is a limited liability company; Certified copy of trust agreement with all amendments, if Borrower is a land trust or other trust; etc.)

(b) Certificate of Good Standing (if a corporation or LLC) or Certificate of Existence (if a limited partnership) or Certificate of Qualification to Transact Business (if Borrower is an entity doing business in a State other than its State of formation)

9. Evidence of Borrower’s Authority to Borrow; including

(a) a Borrower’s Certificate;

(b) Certified Resolutions

(c) Incumbency Certificate

10. Satisfactory Commitment for Title Insurance (which will typically require, for analysis by the Lender, copies of all documents of record appearing on Schedule B of the title commitment which are to remain after closing), with required commercial title insurance endorsements, often including:

(a) Affirmative Creditors Rights Endorsement (extending coverage over policy exclusion 7 and policy exclusions 3(a) and 3(d) as they relate to creditor’s rights matters)

(b) ALTA 3.1 Zoning Endorsement modified to include parking

(c) ALTA Comprehensive Endorsement 1

(d) Location Endorsement (street address)

(e) Access Endorsement (vehicular access to public streets and ways)

(f) Contiguity Endorsement (the insured land comprises a single parcel with no gaps or gores)

(g) PIN Endorsement (insuring that the identified real estate tax permanent index numbers are the only applicable PIN numbers affecting the collateral and that they relate solely to the real property comprising the collateral)

(h) Usury Endorsement (insuring that the loan does not violate any prohibitions against excessive interest charges)

(i) other title insurance endorsements applicable to protect the intended use and value of the collateral, as may be determined upon review of the Commitment for Title Insurance and Survey or arising from the existence of special issues pertaining to the transaction or the Borrower.

11. Current ALTA Survey (3 sets), [typically prepared in accordance with 2005 Minimum Standard Detail for ALTA/ACSM Land Title Surveys, certified to the lender, Buyer and the title insurer, including items 1 through 4, 6, 7(a), 7(b)(1), 8 through 11(a) and 14 from the Surveyor's "Optional Survey Responsibilities and Specifications" referred to as "Table A"].

12. Current Rent Roll

13. Certified copy of all Leases (3 sets)

14. Lessee Estoppel Certificates

15. Lessee Subordination, Non-Disturbance and Attornment Agreements [sometimes referred to simply as "SNDAs"].

16. UCC, Judgment, Pending Litigation, Bankruptcy and Tax Lien Search Report

17. Appraisal (must comply with Title XI of FIRREA (Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended)

18. Environmental Site Assessment Report (sometimes referred to as Environmental Phase I and/or Phase 2 Audit Reports)

19. Environmental Indemnity Agreement (signed by Borrower and guarantors)

20. Site Improvements Inspection Report

21. Evidence of Hazard Insurance naming Lender as the Mortgagee/Lender Loss Payee; and Liability Insurance naming Lender as an “additional insured” (sometimes listed as simply “Acord 27 and Acord 25, respectively)

22. Legal Opinion of Borrower’s Attorney

23. Credit Underwriting documents, such as signed tax returns, property operating statements, etc. as may be specified by Lender

24. Compliance Agreement (sometimes also called an Errors and Omissions Agreement), whereby the Borrower agrees to correct, after closing, errors or omissions in loan documentation.

It is useful to become familiar with the Lender’s loan documentation requirements as early in the transaction as practical. The requirements will likely be set forth with some detail in the lender’s Loan Commitment - which is typically much more detailed than most loan commitments issued in residential transactions.

Conducting the Due Diligence Investigation in a commercial real estate transaction can be time consuming and expensive in all events.

If the loan requirements cannot be satisfied, it is better to make that determination during the contractual “due diligence period” - which typically provides for a so-called “free out” - rather than at a later date when the earnest money may be at risk of forfeiture or when other liability for failure to close may attach.

CONCLUSION

Conducting an effective due diligence investigation in a commercial real estate transaction to discover all material facts and conditions affecting the Property and the transaction is of critical importance.

Unlike owner occupied residential real estate, when a house can nearly always be occupied as the purchaser’s home, commercial real estate acquired for business use or for investment is impacted by numerous factors that may affect its use and value.

The existence of these factors and their affect on a Purchaser’s ability to use the Property for its intended use and on the Purchaser’s projected investment yield can only be discovered through diligent investigation and attention to detail.

The circumstances of each transaction will determine what degree of diligence is required. The level of diligence required under the circumstances is the diligence that is due.

Exercise Due Diligence.

R. Kymn Harp is a seasoned attorney based in Chicago, Illinois with 30 years experience representing commercial real estate investors, lenders and developers. He is a frequent speaker at continuing education seminars, and is a widely published author on commercial and industrial real estate topics including due diligence, entitlements, commercial real estate financing, and Brownfield development and financing.

R. Kymn Harp can be contacted at:

Robbins, Salomon & Patt, Ltd
25 E. Washington Street Suite 100
Chicago, IL 60602
Dir. Ph: 312-456-0378
Email: rkharp@rsplaw.com

For more information go to: http://www.realestate-law.com

Don’t believe all the gloom and doom you read…

The U.S. housing bust may be just about over. We should be darn close to the bottom… possibly within one year of it.

You probably don’t believe me. That’s okay. I’m used to being the contrarian - it’s a position I prefer to be in actually. But bear with me, and at least hear me out…

Today, I’ll share with you two simple facts that explain where we are now in housing and why we could be close to the bottom. Let’s get right to it…

1) Houses are affordable again.

You may be flabbergasted to hear this… But U.S. houses are affordable again.

Since last summer, the change has been extraordinary. The typical mortgage payment on the typical home in America now is 20% cheaper than it was less than a year ago. Let me explain:

Last July, the median U.S. home would have cost you about $230,000. And you’d have paid about 7% in interest on your mortgage. So that’s a $1,200 monthly mortgage payment on that house (assuming a 20% down payment).

Today, the median home price is $200,000 - a $30,000 difference from last summer. And mortgage rates are down to 6%.

Between the lower price and the lower mortgage rate, you’d be paying less than $1,000 a month on your mortgage now - for the same house that would have cost you $1,200 last summer!

Most people shop for homes based on their mortgage payment… They ask, “How much can I afford each month?” And then they look for homes that will give them a payment they can afford.

So the big question is: Can the typical household afford the typical mortgage payments on a typical home? Last summer, the answer was no. But now, the answer is yes.

You may be surprised to hear it, but thanks to lower mortgage rates and lower home prices, homes are affordable… They’re just as affordable now as they were right before they boomed in the 2000s.

2) We’ve paid our dues, pricewise.

You may also be surprised to learn home prices in general don’t go up that much…

The median U.S. home price has only risen at about 1.5% per year since the 1970s, after you subtract inflation. That’s not much of a gain. (Even that 1.5% price gain is overstated… Homes have gotten much larger since the 1970s.)

The annual increase in price has been consistent… Whenever prices run significantly above that trend, like in 1978 or 1987, they run significantly below that trend three to four years later.

Have we paid our dues yet?

Cycles happen. You can see it easily in this chart. You can also see in 2005, prices ran farther above trend than any time in history. And now, in 2008, prices have fallen farther below trend than any time in history.

Could we see another year or two below trend? Of course. But I expect that we’re in the process of finishing “paying our dues.” We’ll return to the trend.

In sum… you may be surprised to hear it… but

1) U.S. homes are once again affordable.

2) We’ve just about “paid our dues” pricewise.

Don’t get caught up in the gloom and doom. Stick with the simple facts.

These indicators are pretty simple. They show how the worst of the housing bust could be behind us already.

The DailyWealth Investment Newsletter is published by Stansberry & Associates Investment Research