Yes by primusboy

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									Yes, You Really Can Invest in Real Estate Without Cash
Do you want to get involved in investing in real estate but don’t seem to
have any extra money in the bank? This is a common problem, but what you
may not realize, is that you can start investing with little or nothing
in your bank account. Basically, if you own your own home, you can
leverage this asset and find yourself investing in no time flat.
As long as you own your own home, pay your mortgage and have fairly
descent credit, it will actually be easy to get started in real estate
investing. There is most likely a pretty good amount of equality in your
house. Even if you have only owned your house for a short time, you have
been paying it off and it is most likely has been increasing in value.
Just take a look at the balance of your mortgage and subtract it from its
current value. Of course you may need to include a second mortgage or and
other liens that may be on your property, but you should still have
equality to work with. This is your green light to move forward into
investing.
Here three ways to use the equity in your home to raise the capital for
real estate investing.
1. Refinancing Your Home - You can refinance your house, get a better
interest rate and also get some cash out from a refinance mortgage. You
can use the cash to purchase an investment property outright, or you
should at least have least enough money for a down payment of a property.
Be sure to check with your lender or mortgage broker for any of the rules
about cash-out refinancing. Keep in mind, a cash-out refinance mortgage
may have higher interest rates than other types of mortgages.
2. Using a Home Equity Loan - A home equity loan uses the equity in your
home as collateral, this would be a second mortgage to the one you
already have. The mortgage amount is based on a percentage of the equity
in your house. You may be able to borrow up to 100% of your homes value,
but if you are getting a home equity loan on a second property, you may
not be able to borrow as much. This type of loan allows you the option to
pay the loan back early without penalty, just a nice little bonus.
3. Open a Home Equity Line of Credit - A home equity line of credit has a
credit limit similar to a credit card. This is not much different from a
home equity loan, the amount that you can borrow is based on your credit
score and the amount of equity in your home. You can transfer funds from
your home equity line of credit, or even write checks directly from the
account. Interest rates are generally lower than cash-out refinance
mortgages, and there are tax advantages as well. Another advantage is
that you are only paying interest and making payments on the amount you
owe at the time, not the entire amount of the loan. In the future, you
may also be able to renegotiate for a higher credit line when the equity
in your house increases, especially if you have made improvements to your
house.
Real Estate Investing is not only for the rich. The average homeowner can
get started in real estate investing even if you don't have a lot of
money in the bank. You can use cash-out refinance mortgages, home equity
loans, and home equity lines of credit to begin your journey as a real
estate investor, and continue to build more investments into the future.
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