3 Keys to succeed in investment real estate finance
Successful investment real estate financing has been done by many real estate investors for years. Real estate developers have used other people’s money for years to finance the building of real estate projects. The key here is to learn how to finance your next acquisition and how to make money in the process. Let us look at the 3 keys to succeed in investment real estate finance.
The following are the three key areas that are important to succeed in investment real estate financing in your next real estate investment deal.
1. Your credit worth history
The credit history is of vital importance to bankers today for the purpose of financing any real estate investment. The reason for this is that your personal credit history is used to judge your ability to pay your debts as they fall due. In most banking circles today especially in the cities, sometimes within 30 minutes to one hour of your default in payment, all banks would know of your financial inability to pay and your credit rating will drop.
It is very necessary when doing investment real estate financing, you might want to run a credit check on yourself so that you can figure out what the bankers would ask and you would have a ready reply for them. Thus a good credit history can help you in investment real estate financing.
2. Your prior experience
Some property management experience may help in your application for the mortgage. As strange as this may sound it may make perfect sense for the banker. If you can show that you are responsible for work and make him believe that you can manage the property and the rental, there is a high chance that you will be able to pay him. Thus successful investment real estate financing depends partly on the ability of the individual to convince the banker that you can manage the property and pay him on time.
3. The Property Finance Plan
The successful investment real estate financing should also come with a property finance plan. This plan would list how much in a rental you will receive, details of the property and how much you want to borrow from the bank. The reason for this is that it will be easier to convince a bank officer about the potential of you paying his monthly installments. If you can show him how much in terms of rental that you expect from the real estate investment in the first place and how much it measures out relative to your expected monthly installment. You could do a financing plan and then print several copies of this and bring it along to all the bankers that you meet. The more confident you are about the deal, the more confidence the banker would have in you as well too.
In conclusion, the three important keys to successful investment real estate financing are very important. Consider them when you go next to your banker to ask for investment real estate financing.