What Financing Options Do First-Time Investors Have?

Today, let’s discuss the options you have if you’re looking to become an investor but are struggling with the financing.
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What can you do to get your first investment property if you don’t have enough for the 20% down payment?

Actually, you have a couple options in this situation:

First, if you don’t have enough for a 20% down payment, there are other loan programs for investment properties to consider. Some companies can offer down payments as low as 5% for some properties! Of course, the market always changes and we’ll constantly have to update our understanding of what is available, but regardless, there are programs with requirements other than the traditional 20% conventional loan.

Second, try bringing in a partner. If you’re taking the steps to buy your first investment property and you’re willing to do all the necessary work to find the deal but you don’t have the cash to make it happen, you might work with a partner who can fill in that half of the equation.

Who would count as a viable partner? Well, tell the people you know and trust—like your friends, family, neighbors, etc.—about your goals and dreams. Give them the rundown of your plans and see if they’re interested in joining you in your venture. There are plenty of people out there who might have the cash, but like the hustle, and it’s through them that you have an opportunity to get your foot in the investment door. It won’t necessarily be easy to find the right person at first, but finding a well-funded partner to match your drive and vision is a good way to overcome that barrier.

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If you want to get into the investment game, there are opportunities in the market to be had by those with the proper drive.

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Lastly, look for a contract-for-deed. Now, because the market is doing so well, there won’t be a lot of these opportunities. But again, the market always changes, and eventually these contract for deed options will come back in a stronger suit. Essentially, a contract for deed is an arrangement in which the buyer makes regular payments to the seller until the amount owed is paid in full or the buyer finds another means to pay off the balance. Until the balance is paid, the seller retains legal title to the property. If you can find a seller who wants to keep their cash flow but doesn’t want to take the tax hit, this may be a viable option for you.

Ultimately, if you want to get into the investment game, there are opportunities in the market to be had by those with the proper drive. If you’d like to dig into this topic further or if you have any questions, feel free to give me a call. We can put together a plan for you to help you build wealth. I look forward to hearing from you soon.

3 Tips for Winning Multiple-Offer Situations

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As a buyer, there are a few things you can do to give yourself the best chance of winning in a multiple-offer situation:

• Get pre-approved. Thanks to low interest rates, homes are moving rather quickly. If you don’t know what you can afford to purchase, you’ll lose out. Sellers don’t want to wait for you to get your pre-approval, so make sure you have it from the outset.
• Be early to the game. In sports, you can’t show up at game time and expect to play well. You have to do the work first and be prepared. It’s very similar to buying a home—when we see something, we have to be there and be ready to put in an offer right away. The worst thing we can do is try to come in at the last minute.
• Put your best foot forward. When you’re writing offers, you can’t rely on winning by simply setting a high price. You have to think about your terms as well.

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When we see something, we have to be there and be ready to put in an offer right away.

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I’d be more than happy to help you navigate these multiple-offer situations. If you’d like my guidance or you have any questions whatsoever, feel free to reach out to me. I look forward to hearing from you soon.

Renting vs. Buying: Which Is Better?

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When it comes to the debate about whether renting a home or buying one is better, there are a few things you should know.

Rents are 2.7% higher this year than they were last year. What does that mean for you as a renter?

The longer you wait, the more expensive rents will be. Considering where we are right now in terms of interest rates, there is a definite advantage to homeownership. You can actually save money by purchasing a home.

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Rents are 2.7% higher this year than they were last year.

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We can help you figure out which option is better for you by assessing your situation. We’ll look at your current rent versus what you’d qualify for if you were to purchase a home, as well as what the associated expenses would be.

At the end of the day, don’t fall into the trap of renting and throwing your money away.

If you have any questions, feel free to give us a call or check out our website, www.teamwinegarden.com.

Do’s and Don’ts for Homebuyers in 2018

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I’ve been getting a lot of questions around this time of year. Many of them go like this: “I’m thinking of buying a home in 2018—what are some of the things I should do to get ready for that?” I found a complete list that I’d like to share with you today.

1. Don’t open up any new trade lines. This would be something like a new credit card or a new car. Pretty much anything that can be reported as debt on your credit report will affect your debt-to-income ratio, which affects your affordability. Until you get in that new house, just hold off.

2. Suggest a different kind of “gift.” The holidays are coming up. If you’re like me, you get a bunch of stuff that you’re very grateful for but you know is going to end up sitting in the closet or the garage. Suggest financial gifts instead. Tell them about your plan to buy a new house and ask for a gift you can use as part of a down payment.

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It’s the perfect time to get pre-approved.

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3. Get pre-approved now. Even if you aren't looking to buy for a few months, it's the perfect time to get pre-approved. This way you know what you can afford in advance and start looking at those homes right away. You'll know if you need to work on anything in your credit as well.

You can get the full list of tips right here on Trulia.

If you have any questions for me, don't hesitate to ask. If you have any questions about the process or need any help getting started, give us a call or send us an email. We look forward to hearing from you soon.

How to Buy and Sell a Home Simultaneously

Here’s how we can help you find a new home while you sell yours.

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One question we’ve gotten from a lot of our clients lately is, “What if I can’t find a new home after selling my current one?” Selling your current home can seem like a major risk, especially if you’re not confident about finding another house you like on the market in a short time span.

As someone who has had experience in this field for a number of years, there is one thing that I can tell you: if you don’t have the ability to purchase a new home, you will never find a house that you like. What does this mean? If you don’t have enough money to buy a home before you sell yours, you’ll never find a home that meets your needs because you’re not truly looking for a house; you’re window shopping for one.

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We can help you find a short-term rental or get a leaseback.

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This is why it’s so important to list your home on the market before you go house hunting. So pull the trigger and give yourself an option. At the end of the day, if we can’t find anything that you like, there are other options.

Short-term rentals are a viable option, as are leasebacks. A leaseback involves leasing your home back from the buyer after closing, allowing you to live in it until you are able to find a home that suits you.

One thing I can say with certainty is that if we sell your house, this issue will not be a problem for you. I guarantee you that we’ll get you taken care of. If you have any other questions about how to balance buying and selling a home simultaneously, give me a call or send me an email. I’d be happy to help you out!

How to Knock 8 Years Off Your Mortgage

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Today we wanted talk about some differences between 15-year and 30-year mortgages, and also a slightly different alternative to those two traditional loans.

In today's market, I'm sure you know that interest rates are at an all-time low, but that's not going to last forever. When you're looking at buying a home in Minneapolis, your main options are 15-year and 30-year mortgages. The main difference is how they amortize those payments, so what we're looking for is the best payment and the shortest amount of time so we can decrease the interest that we pay.

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You'll knock eight years off your mortgage by saving interest.

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Many buyers like the idea of a 15-year mortgage, but can't afford the payment because it's so much higher. So consider this...

Instead of a 15-year mortgage, you can take out a 30-year mortgage and make one extra payment per year. You make 13 payments per year instead of 12 payments. That extra payment can seem daunting, so instead of paying it all at once, you can simply add 1/12 of the payment amount to your monthly mortgage payment to spread it out over the course of the year.

Why? By increasing your payments by just 1/12 each month, you'll knock eight years off your mortgage by saving interest. It's a really cool strategy that anyone can take advantage of and turn a 30-year mortgage into a 22-year mortgage without the stress of the skyrocketed payment amount that comes with a 15-year loan.

If you're interested about this topic or have any questions, feel free to give me a call today.