You may have a great real estate investment project in mind, but without sufficient credit experience the financing may be out of your reach.  Needless to say, working with someone else’s credit requires a high degree of trust, integrity and a well-written partnership or joint venture contract.   How can you create a contract using someone else’s credit to make the deal work? Your prospective partner or joint venture associate wants the project to be worth their risk, and they need protection of their assets.  What can you offer to make the project worth their while?  Common contract terms include… a Read more…

Did you know that in many cases you can use the equity in your home or other existing property to finance an investment property? But how? Here are some things to keep in mind… First, understand that your primary home may be your best and lowest-cost financing source.  Typically, second mortgages and homeowner’s line of credit (HELOC’s) have some of the lowest interest rates on the market, more favorable than construction loans, private lenders and other sources of funds.  In fact, if you have enough equity to finance the full value of the investment property, you can save on both Read more…

A good credit score can be the key to the funding that makes your real estate investment profits possible.  What are some quick steps you can take now to bring your credit score up? The three credit reporting agencies, Experian, Equifax and Transunion, are required to send you a free credit report once a year at your request.  Contact creditors to clear up any errors you find on the report.   You should dispute old negatives with creditors and reporting agencies, particularly small balances, as sometimes these will be removed without investigation. Pay  monthly bills, from utilities to credit cards, on Read more…

Over the past couple of weeks, we’ve been talking about leveraging other people’s credit and capital to help you acquire real estate investment properties. There are individuals and business ventures with money to invest or lend who are looking for high-return investment opportunities such as yours – aka “private money.”  How can private money fit into your real estate strategy? Look for private money terms with the flexibility to be tailored to your project cash flow.  For example, you may want an agreement deferring all profit-sharing, return of capital or loan payments until after the final sale. If you prefer Read more…

As we discussed in the previous post, no matter how much money you have or how good your credit is, eventually you’ll hit a brick wall if you try to build your real estate portfolio all on your own. In other words, you need investing partners so that you can leverage their credit and capital and acquire additional properties. Last time, we talked about using someone else’s credit.  Today, we’ll discuss how to use someone else’s capital to acquire more properties… Receiving a monetary gift is the simplest means by which you can use someone else’s capital for an investment Read more…

Every real estate investor needs to understand not just what’s going on in the local market…but what’s happening in the broader national and even global economy as well. Here are three economic websites you should read weekly to stay on top of your game… 1)      The Wall Street Journal.   One of the site’s best sections is called Market Watch, which focuses on both local markets and big-picture economic factors.  In addition, The Journal keeps close tabs on international influences on the economy, as well as evolving government policy and, of course, business trends. 2)      The Economist  is an internationally-respected site Read more…

No matter how good your credit is or how much of your own capital you have to spend, eventually you’ll hit a brick wall as an investor if you don’t start leveraging other people’s money and credit for your portfolio. Here are some ways to use other people’s credit to invest in real estate… 1)      Create a joint venture deal with a financing partner, where they assume the mortgage and the expenses of a real estate investment property, while you handle strategy and management.  Very likely both the loan and the title to the property will be in your partner’s Read more…

Wherever you’re investing, it’s vital that you have the market information you need in order to make smart, sound decisions. Where can you go to keep your ear to the ground on what’s going on in your local real estate market? Here are some suggestions… 1. The MLS will always be a go-to source of immediate data on critical factors such as properties on the market, asking prices, recent sales, time on the market and much more.  However, you may find that a mountain of raw data only goes so far when it comes to crafting long-term strategies. 2. Personal Read more…

What if you have good credit, but don’t quite qualify for a mortgage loan?  What are some other options to get into a real estate investment on your own credit? 1)      If you don’t have enough down payment for the property you want, a lease-to-own contract may be an option.  Lease-to-own gives you time to accumulate the down payment and qualify for a mortgage loan, while locking in the purchase price. If you negotiate the deal correctly, you can even lease it to a tenant at the same time.  It’s common for lease-to-own contracts to include a premium over and Read more…

Successful real estate investors keep themselves aware of the economic indicators that have the most influence on their markets.  As we’ve discussed the last couple of weeks here on the blog, real estate comes down to the economic fundamentals that influence people’s lives and choices.  Here are the 5 most important real estate market factors to watch. 1)      Demographics create the underlying need for housing and commercial property in your area of interest.  How many people are in the age range and life status with the most need for new housing and job space?  Not just population numbers, but factors Read more…