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Eric Foster
Question from Sara… I’ve always been curious about fixing up investment properties, could you maybe tell me where I can find more info on getting started and how to come up with the capital to get a house and fix it?…
Answer… The best place to start your Real Estate Investing education is to “Partner Up” with someone who has been doing it for a while. There are many ways to make mistakes in Real Estate Investing, and those mistakes can be very costly… and painful! There are also many good books on the subject. Any large library or book store will have a good selection. As far as the money goes… you can team up with a “Money Partner”. Also, many mortgage lenders offer various types of rehab loans for Investors.
Best of Luck… Eric Foster
Question from Cristina… Eric - We just finished our first flip…purchased for $225K listing for $850k and would like to do this full time. Can you tell me how banks handle lending money to someone without an “employer”?
Answer… Cristina, You are Awesome! Good Job! Just so you know… You are further along in the “Real Estate Investing” game than you probably realize. Most people only think about it, take some classes on it, read about it… But never take that first step… Getting that 1st deal done is the toughest step!
Now, your question… I spent many, many (too many) years as a mortgage loan officer. It always comes down to what I refer to as “The Three Parts of a Loan”. They are as follows… 1) Credit, 2) Collateral, and number 3) Income. What that generally means is… the more of the 3 parts you have… The easier it is to get a loan.
As a general rule, if you have 2 or more of the 3 parts… You can get a loan! Getting a loan with only one of the three parts is doable (under the right circumstances), it is just more difficult.
The best thing to do is go explore the loans that are available with several mortgage brokers (A broker represents many different lending institutions).
Make sure you find and interview those (at least 3 loan officers) that have a lot of experience in financing investment properties, or “Non Owner Occupied” as it is called in the mortgage business. Make sure you go to a broker and not a bank, since banks are usually are more strict with their lending, unless you have a good ongoing relationship with them.
To sum it up, learn all you can about credit and what it takes to get financing and mortgage loans. If you understand how this all works, and what lenders look for, getting the money with no “Employment” will not be a problem.
P.S. You probably want to check into becoming incorporated and conduct your investing activities using a business name. That way you can be an “employee” of the company, and receive a regular pay stub and W-2… At that point you DO HAVE EMPLOYMENT. Also, there are tax benefits and liability protection having a corporation.
Have a Great Day… And go get em!
Eric Foster
www.EmpireHoldingsInc.com
www.BuildingMyRealEstateEmpire.com
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