People are always on the lookout for great deals in real estate. As a general rule, the greatest chance for profit comes with buying in a down market. But if you don’t have liquid assets available, or if your credit score isn’t high enough, buying real estate can be problematic.
On the other hand, if your credit rating is stellar and you are financially stable, there are many great financing methods to consider if you’d like to use real estate to increase your net worth. Read on for some helpful ideas.
Banks and credit unions are the most traditional way through which people are financing their real estate investments. However, due to the sub-prime housing fiasco, lenders have much stricter criteria. Most banks nowadays require a credit score of at least 680 in order to be approved for a real estate loan. A 10% down payment is also common, although different banks may vary on this. Biz2Credit can help connect you with a bank that can offer you the best deal.
This method of financing a real estate investment is ideal for a quick, short-term solution. “Subject to” means “subject to existing financing.” What this means is that you buy the property on the condition that the existing financing remain in its place. Thus, the loan is in the seller’s name, but the buyer is the one who will make all the payments. Remember that this is a short-term solution since most people are unlikely to be comfortable with having the loan in their own name forever.
If your credit score is low, or you’re not sure what your long-term plans are, leasing is still a great option. You can use the property with little money down, and you can potentially buy the property a number of years down the road — depending on the owner. A monthly lease payment is also easy to arrange, and could potentially save you some money and hassle.
Loan specialists at Biz2Credit can help you pick the loan option most suitable to your business. Visit the Biz2Credit.com or call (800) 200-5678 for help.