Calling All Newbie Investors
Are You Ready to Add Investor to Your Resume? Part One: Bags O’ Cash
One of the most frequently asked questions I get as a real estate broker is about how to get into the investment game. With shows like Fixer Upper and Flip or Flop, it is a no brainer to add this as a smart and savvy side hustle to your current gig. I mean, it looks so easy on TV!
So what does it actually take to be an investor? Let’s take this one step at a time. First up, financing. While it would be nice to go grab cash from a lush money tree in our backyard, the majority of us newbie investors will have to go the financing route. We spoke to Amanda Conrad, Loan Officer at Texas Bank Mortgage, who tells us that with investment homes, down payments as little as 15% are required.
Amanda tells us, “A common myth is that the only loans available to investors are “hard money” loans with extremely high interest rates. We can offer many different investment loan types where the borrowers can get a long term, fixed rate that is more in line with the typical market rates.” So no loans from the mob with kneecaps as collateral? Wow!
“We also can offer purchase plus improvement loans to investors where they can put a down payment for the total cost of the purchase plus improvements (this would require 20% minimum) and then draw the funds for improvements like a regular construction loan. Then, we can refinance it for them to a long term loan.” This means we can finance the improvements too?! Holy cow. Ok, this dream is now becoming a reality…
Part Two will cover how to find these hidden gems in a HOT market like this one. Stay tuned.