How would you like to make some easy pocket money off your property without having to invest any money upfront? In this article, a few “cute” real estate “schemes” will be examined to see how they can generate quick and easy cash. But the conditions under which they work may not apply in all cases, so before attempting any of the methods outlined below exercise due diligence and make sure it will work in your specific case!

If the property you own bears a significant amount of equity, you may very well be able to take all that money out while still holding on to your property. There are a few popular ways of doing this, popular because they can work out quite handsomely from a financial point of view. One way is to just take out a second mortgage on your property. For instance, pretend that you had acquired some property five years ago at a hundred thousand dollars, where eighty thousand of that was through a mortgage. Your equity, in this example, would be twenty thousand dollars. Now suppose this property is worth a hundred and thirty thousand dollars at the present moment, with your mortgage now paid down to seventy-five thousand dollars. The new amount of your equity just grew to a total of fifty-five thousand dollars! Now imagine if you then borrow thirty thousand dollars. Your total debt on the property would then be a hundred and five thousand dollars, a rather reasonable debt-to-equity ratio of eight-one percent.

Another cute little way that might generate money is to use the property as collateral for a line of credit. Continuing with the example started above, your equity of fifty-five thousand dollars could earn you as much as thirty-thousand dollars in credit, with no interest until you actually use the money – which, even then, wouldn’t be so bad given attractive rates.

Last but not least, you can always install a rent-to-own tenant on your premises, allowing someone with the desire to purchase anywhere from twelve to twenty-four months to cash you out. Such a tenant will typically pay three to ten percent of your property’s value in the form of a non-refundable deposit. This money can be thousands, or even tens of thousands, of dollars – cash! – straight into your pocket, so that if the tenant does not follow through with a purchase, you get to keep it and start the whole thing all over again!

Of course, these methods are described as “cute schemes” because they are not the kind of business models on which to found a real business. They’re just little “tricks of the trade,” if even that; under no circumstances should they constitute your livelihood! Think of them as opportunities for extra income – at best. Do not base any financial decisions of any consequence on this short introductory survey of an article; always consult the relevant professionals, properly licensed and qualified, when it comes to business and the law!

Author Bio: Barbra I. Miller writes frequently on real estate topics for various online publications. Please visit RealEstateEducation101.com for more great articles from industry insiders such as Isaac Toussie and others!

Category: Real Estate
Keywords: real estate, commercial property, business, advice, property markets, realty