Investing Part 2

I am going to touch on real estate investing this morning. I am thinking about putting on a class about buying your first investment property, but for now, my blog will have to do.

Nowadays it costs a little bit more upfront than it did before to buy an investment home, as banks and mortgage companies want more down to secure the note. About the minimum I have been able to find is 10% down. Now, this doesn't cover everything...only your down payment, but you can finance in the rest.

The first thing to do when looking for a rental property is figure out how much you will make factoring in for at least 1 month per year vacancy. That is where I come in. I will run all of those numbers for you and together, we will find the best house (or condo) to fit your needs. I recommend looking into foreclosures as you could do (or have done) the repairs if needed, to make it ready for occupancy. Foreclosures also are usually a better value and are great for a first-time investor.

Once we find the property, I will refer you to to a mortgage company or bank that will be able to help you. I recommend starting out small, so $50,000 to $70,000 would be about the best number to spend on your first rental home. Another good reason is you would only need to have $5,000 to $7,000 to put down and you can finance in the rest. The rest would be the prepaids, insurance, tax prorations, etc. If you have a bank that you work with, you can probably get a better deal as you won't have to pay closing costs.

Finally, once all of this is complete, now you are ready to put the home on the market for lease. I can help with that as well. My firm will run a credit and background check to make sure you aren't getting a dud. Once that is complete, you and the new tenant sign the lease and voila...you are a landlord. The best part is, you have someone else making your payments for you. If you only do a 15 year note, then in 15 years you own the property outright with no mortgage! Can you think of a better way to build wealth?

Lastly, real estate is a solid investment opportunity and over time will help you build wealth. I will be there to guide the through the entire process and make sure all of your questions are answered.