If you own rental houses or are thinking of buying a rental house it pays to consider your future selling costs. These costs can vary significantly depending on how you sell, when you sell, and what you do with the money.

We’ll start with seller’s closing costs. The big three are typically sales commissions, county taxes, and title insurance fees. I just sold a house for $290,000. I paid $4451 to the county as transfer taxes and I paid $1323 for title related fees. No real estate agents were involved so fortunately I avoided paying $17,000+ in commissions. As you can see these costs can put a large dent in your profits. They vary depending on the property location. Contact your local title company to identify the costs in your area. (more…)

We’ve all heard about the recent problems with mortgages referred to as subprime loans. The current and more importantly future defaults on these loans could push many homeowners into the rental market. In a nutshell, subprime loans are issued to borrowers with a low credit rating. (more…)