NOTE PROFESSOR NOTEBOOK Is For Real Estate Investors...Continued

You determine you can rent this property out for a net positive cash flow of $500 a month. You also plan to sell the property in 3 years for $75,000 net. What would be your rate of return? Did you come up with 23.61%? You should have known this before you make your offer.

How did I arrive at these figures, it's easy! All you do is take the monthly rental cash flow of 3 years, a future value of $75,000, and calculate what the rate of return would be. This is the same thing as discounting a series of payments with a balloon.This NOTE PROFESSOR article will show you how to calculate your rate of return quickly and simply.

Let's tweak this example a bit. Assume that you put $5,000 down, and borrowed remaining $45,000, including fix up costs at 8% for 30 years. What would your monthly payments be? Did you get $330.19? If not, go to "How To Discount Even Cash Flows". Now instead of having $500 net monthly positive cash flow, we only have $169.81 ($500-$330.19). You still plan to sell the property in 3 years for $75,000. What is your rate of return? Did you come up with 77.29%? WOW!! Now you know why leveraging is important.

Problem: What would your rate of return be if you had a $200 a month negative cash flow? HINT: The process is still the same. You would still get an excellent rate of return of over 30%, but all relies on selling the property in 3 years for $75,000. What will the property be worth in 3 years? Be careful.

All of these real life investment questions can easily be answered by knowing the powerful techniques of how to discount cash flows, with or without balloons. If you are serious about investing in real estate, this is a MUST KNOW. Wouldn't you agree it is worth a small investment to be armed with the commanding knowledge of how to evaluate properties and rates of returns?

NOTE: Numerous readers have wisely invested in individual articles, and liked them so much, they decided they wanted to invest in the entire NOTE PROFESSOR NOTEBOOK. You have asked if you can get credit for the money you invested in the individual articles. The answer is YES!!. However, I cannot do it over my website because PAY PAL is set to accept only full price. So for those of you who want to "try before you buy", go ahead and invest in 3 or 4 lessons. If you decide you want the complete NOTEBOOK, contact me, and I will personally send you the complete NOTE PROFESSOR NOTEBOOK, and then discount your purchase price by the amount of individual articles you purchased. I can hold this offer open for only 30 days from the time you purchase an individual lesson, so hurry. This is similar to an option to purchase. Be sure to take advantage of it.

As usual, contact an attorney or CPA before making any investment.

Be sure to contact THE PROFESSOR with your questions or comments. I love success stories, and it is from your questions that I get my topics.