If you see the words “Financial Freedom” or “Passive Income” you should leave now says Lawrenson of Letting Focus

One of the nicest back handed compliments I get is the fact that when one searches for LettingFocus or David Lawrenson on Google, one gets a load of sponsored ad results appearing at the top of the search results and down the side.
These sponsored links are usually slightly shaded in on the windows internet browser.
For those who are uninitiated in the black arts of search engines, what’s happened here is that other companies have bought google adwords for “David Lawrenson” and “LettingFocus.com” so that every time someone searches for those words on Google, that companies sponsored (advert) entry comes up too.
It will cost them X number of pence every time someone clicks on one of their entries.
There is nothing illegal about them doing this. Well, not unless one has trademarked one’s name, possibly.
These firms do it because they have no worthwhile content of their own on their sites, so have to piggy back off the likes of real property experts.
Actually, it is all a bit of a waste of money for them as about 70% of people never click on sponored search results, preferring instead to click on results that have been earned on merit in the organic (non-paid for, non-sponsored) search engine results – where I come pretty near the top anyway for these search terms.
Actually I was quite pleased that even more of these duff property firms are trying to “bum” off the back of my name than they are for TV property personalities like Gary Mclausland or Sarah Beeney. A real back handed compliment.
But I’m not alone. The names of other respected property people like Tessa Shepperson and Richard Bowser are similarly targeted by these guys who have bought google adwords for their names too.

FINANCIAL FREEDOM WHILST SITTING ON THE LOO
Now, one of the enduring features of some of these companies is that they always have a teaser free course – available for a limited period only, natch.
And they are always giving out gifts allegedly worth £X thousand pounds – only available for the next few days and if you sign up now, of course.
They often have a chap or lady with a smooth sales patter and good looks appearing on a video.
But most of all they promise you financial freedom with a passive property income within a few months just by going on their course.
So, no more daily grind to work to a boring job, getting stuck in traffic or under someones sweaty arm on the tube… become a property millionaire in a year, blah blah.
Just sit back, do nothing at all and watch the rent roll in.
Oh, and if anyone tells you it’s not that easy (i.e. real people like me, I guess) and that you are wasting time and your £6,000 signing up for their course, you should ignore them as people like me are negative and NOT TO BE LISTENED to.
I think the Moonies and the like used similar tactics.
Not all the companies that have paid for google adwords using my name do this, but a lot do.
So, for the record, I have no links with any of the companies who have paid for sponsored search results under my name or using the term “LettingFocus”
And if you have lost money as a result of going with a property company like one of the ones I have described here and you would like it featured in the press, please let me know and we will pass it on to interested journalists in the press or on TV.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of LettingFocus.com - the property letting experts. Read Landlords Articles.
I’m the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property book - buy Landlords Book.
The new edition is for accidental and experienced landlords and is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on sale and rent back.
I’m an expert property writer and property speaker - and I run the well known landlords blog that you are reading now.
I contribute to newspapers and a host of property websites, write a number of columns in the press and I provide general property letting advice and consulting to anyone looking to buy property for themselves or to let out. I can help private individuals with any aspect of buying property or buy to let.
What’s unique about lettingfocus.com is that we are independent property investment advisors because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from these sources.
We simply give one to one unbiased advice and are often asked to evaluate other property investments.
Find out about some great deals we have arranged at our Landlords Links page.
Copyright: David Lawrenson 2009. This blog is updated roughly once a week.
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Buying Below Market Value Property with No Money Down - Does it Work asks Lawrenson of Letting Focus?

The answer is yes, of course it can.
But to buy with “No Money Down” you have to find someone desparate and willing to sell you their property for at least 20% below its true market value so you can make the financing work. And that’s the hard bit, of course!
The fact is it’s really hard to find a seller willing to sell you property at 15% below market value (or BMV as it’s called in the trade!) let alone more that that.
OK, the credit crunch has meant it has got a bit easier but its still very hard work to find these deals.
Sure, professional investors can find ‘em at 25% BMV if they spend many hours a week and lots of marketing costs ……and if property investing is their full time job too… but even for them, their own time has to be factored into the equation.
For some property investors it IS definitely worth it and I personally know of a few property millionaires who do this type of investing for a living & many of them read this column. Some have been to my seminars. Many are friends.
But for every one of these, there are many other people who buy with no money down, because they are stretched financially and they think that buy to let is somehow going to be their financial salvation and route to fast riches.
Many of these people have no other siginificant assets and they don’t understand what being a landlord is all about - the hassles, the costs, the laws.
For these people, I’d really question whether they should be in property anyway, because for many new investors who don’t have spare accessible capital, I’d argue the risks of property investment with no money down are just too high.
The fact is that professional BMV investors I know have lots of equity in existing properties or in shares, just ready to pounce in the credit freeze – they don’t have to go No Money Down.
OK, they sometimes do No Money Down deals to buy property when cash flow is tight but the fact is they can access cash, if things get hard and stuff goes wrong – the roof falls in, tenants default -that kind of thing.
For the newbie investor I would say unless you have got £20,000 stashed away for a rainy day or a very kind Uncle who can help you out if things get tough, I would be wary of buying No Money Down.
If you do, you could end up with a house on a very high loan relative to value and if your “Sale and rent back tenant” defaults on the rent you or the boiler needs replacing, you are really going to have hard times indeed।
We are away for a week’s holidays -see you in 2 weeks!
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of landlord experts lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 2 years has been the UK’s top selling property title - buy the UK's top selling property investment book.
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value.
I’m an expert property journalist , property speaker and a well known buy to let blogger
I contribute to newspapers and a host of property websites, write a number of columns in the press and I can provide landlords advice
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property mentor programme at my website.What’s unique about lettingfocus.com is that we offer you help as an independent property coach because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week.
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DID MORTGAGE EXPRESS AND BRADFORD & BINGLEY CATCH A COLD WITH BACK TO BACK RE-MORTGAGING asks LAWRENSON OF LETTINGFOCUS.COM

For a long time the only lender that did re-mortgage loans back to back against bridging finance was the B&B buy to let lender, the Mortgage Express. I wonder if this could explain some part of their current travails.
As I said in an earlier blog, at a recent property trade show where I was speaking I heard a few scare stories about buying Below Market Value (BMV) with No Money Down (NMD).
It seems some of the novice investors have got themselves in a bit of a mess with below market value purchases from distressed sellers - and here is how they did it.
I’ll just explain for those who don’t know that buying BMV can sometimes involve buying from indebted (and hence motivated) sellers who are about to be repossessed by the mortgage company.
Some BMV buyers will seek out and then buy from these kinds of “motivated distressed sellers” at a discount sometimes using bridging loans to buy with “No money down” which they then sometimes rent back the property to the seller who becomes their tenant.
So far so good!
But one of the big dangers is that the kind of property seller who is prepared to do this type of deal - and sell their home at below its true price- will by definition have what we could call “a bad credit history” In other words, they have defaulted on their mortgage already, so the chances are arguably higher that they will default on their new tenancy too than a normal tenant would.
Most BMV investors would say that if they do, well it is bad for them but by doing so, it will allow the investor to evict if the arrears are bad enough.
And that is true, though some will have ethical issues with all this – but let’s leave that aside for now
The only trouble with eviction because of arrears is that it typically takes about 5 months to go through if you have to ultimately enforce the eviction notice with a bailiff.
First, you need there to be 2 months of no rent before you can even start a possession action and it takes another 3 months for the court processes to slowly grind through.
Oh and don’t expect an evicted tenant to leave the property spotless – chances are very high that they wont. And we won’t even mention the stress that comes with having to evict someone.
Whilst most investors are careful to give themselves a financial cushion in the event that things go wrong, I have heard reports of cases of some property investors who are in difficulties with their mortgages because they are struggling with many of these types of properties where they are receiving nil rent.
There a a tiny minority of the less reputable operators in the property market who say you can “become a property millionaire overnight” with “nil (of your own money) down” using bridging loans and other smart financial techniques.
By definition many of the investors who do this will have a very high mortgage loan to value and for those with nothing in reserve, the affect of tenant default can be crippling.
And that’s why we hear stories of some less experienced investors being repossessed themselves - leaving their tenants homeless.
And with the Bradford and Bingley buy to let arm, the Mortgage Express being the last player left in this market, until they too pulled out back in March, one wonders how much bad debt they took on by being an active player in this rather curious re-mortgage market where many investors were novices?
Could this explain some of their current problems?
Who knows - but one thing is for sure and that is that for now the Mortgage Express’s problems will considerably reduce the finance options available for landlords.
The fact is that getting rich in property is very doable, but if you try it with no money down and no spare cash in reserve, you are taking big risks.
Many who bought off plan new build flats through property syndicates like "You Know Who" -you know the ones who have now collapsed and like taking legal action against their critics - have already learnt that you cannot get rich quick in property unless you have learnt what you are doing first.
And please, whatever you do, always have some spare cash put buy, just in case your first deal turns out to be a bad one.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson a landlord experts lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 2 years has been the UK’s top selling property title: buy the UK's top selling property investment book
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value.
I’m an expert property speaker and a well known property blogger and I contribute to newspapers and a host of property websites, write a number of columns in the press and I can provide help for landlords
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property investors networking programme at my website.What’s unique about lettingfocus.com is that we offer property investment mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week. Permission must be sought before using the material in the blog.

NO MONEY DOWN DEALS AND BELOW MARKET VALUE, BMV THREATENED says LAWRENSON OF LETTINGFOCUS.COM

Another casualty of the credit crunch is the “NO Money Down BELOW MARKET VALUE Deals.
I have written about how this works before but in essence how it works is that you buy a property at say 20% below market value from a motivated or distressed seller using a bridging loan and get a remortgage next day for the full market value.
That way you can buy the property with No Money Down.
The problem is that the only mortgage lender prepared to do these types of deals, the Mortgage Express, has I hear, pulled out of doing this business.
No doubt they have been spooked by the credit crunch and the fact that such deals look ever more risky as long as property prices remain shaky.
Also, lenders must have got increasingly nervous about the rental income potential from “sellers turned tenants” on the sale and rent back version of these deals (as that person will by definition probably have some history of not paying their financial obligations)
In the light of the banks new found timidity to lend, Mortgage Express would recently have also become scared of the fact that so many novices (and hence inexperienced landlord investors) were so keen to get in on this kind of deal. This is not surprising as these routes to wealth are heavily promoted at trade shows.
But I understand from one experienced Below Market Value Operator that the doors are also now closed to experienced BMV players too.
According to my contact, this now means the only way to proceed is to hold the property for 6 months on a bridging loan and then re-mortgage. And that ain’t cheap!
It is a shame because Buying Below Market Value or BMV using a bridging loan has it merits.
I will be interested to see what the promoters of seminars on BMV at the Property Investor Show in Manchester next week make of all this and how they will proceed.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson a property expert from lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title buy the UK's top selling buy to let book
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value. I’m an expert public speaker on property and a well known property investment blogger and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and I can provide advice for landlords
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property investors networking programme at my website.What’s unique about lettingfocus.com is that we offer independent property coaching because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week. Permission must be sought before using the material in the blog.

Mortgage companies tighten buy to let lending by LettingFocus

There were some interesting bits of news from the weekend financial press.
First off is the fact that Alliance & Leicester is to restrict lending on new build flats to 70% loan to value amid continuing concerns that prices of new build are falling in many areas and there is a big oversupply problem -too many flats and too few tenants causing landlords who have bought into these places to struggle with falling rents and capitals values.
Those who came to see me speak over the last few years will be well aware that I’ve warned of a big problem to come with identikit flats. Well, now it’s here!
Second, Paragon’s shares were under pressure last week. Paragon is one of the biggest buy to let mortgage lenders. Formerly, known as National Home Loans, they struggled in the credit crises of 1989-1990, when they had to be bailed out. Just as in 1989, they still raise nearly all their money from the money markets -so this really is a case of history repeating itself.

Will Buy to Let Become a Rich Man's Game?
Third, mortgage lenders’ continued tightening of lending criteria in the buy to let market has led RICS to say that buy to let will be a rich man’s game from now on.
I don’t think it’s that bad, but if you have not been in buy to let before you are going to have to find at least 20% of the value of a property – and probably 25% from your own funds from now and for a little while.
So, yes it will get harder for the novice.

Gifted Discounts and No Money Down
But if you are a new to buy to let and you don’t have at least 20% to put in, please don’t be tempted to listen to all the guff about “gifted discounts” on new build and bridging loans to buy below market value – if you do, you are only asking for trouble further down the line.
Sorry to say, but if you cannot really afford to get in, don’t play the game.

ABOUT LETTINGFOCUS.COM
We are LettingFocus.com - the property investment experts and I’m David Lawrenson, the author of “Successful Property Letting” - the UK’s top selling property book for the last 3 years.
What’s unique about LettingFocus is that I offer independent unbiased
property information and one to one advice covering all aspects of being a landlord and investing in property.
Unlike most people in the buy to let and property “advice” business I am not linked to a property company, developer, agent or bridging loan financier.
I can advise where to buy (which areas), what type of property to buy, when to buy, how to buy property at a low price, how to eliminate the risk of getting a bad tenant and more. I have been a landlord and property investor myself for over 25 years.

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Copyright: David Lawrenson 2007. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.