stopping you? Is it the money to get started?
If you are like most people, you think that the way to
get enough money to buy a property is to go to a bank and apply
for a mortgage.
Do you know that the best solution for beginning
investors who are short on cash and credit is a method that most
people don't even know exists? This method allows you to bypass
banks and mortgage brokers.
In three short steps, you can find all of the money you
need to fund any of your real estate deals, without ever having
to apply to a bank for a mortgage.
The first step is to realize that the best solution is
to use private money. Private money comes from an individual,
rather than a bank. A private money investor could be anyone.
When you open your eyes to the possibilities of using private
money to fund your real estate investments, you realize that all
the money you need is hidden in plain sight all around you.
The next step is to find a private money investor.
Private money investors are everywhere, ranging from neighbors
to professional investors. They can be people you already know
or people you find through advertising or online. Let's keep it
simple and start with the people in your own immediate circle.
Your relatives, your neighbors, your friends, your co-workers,
your dentist, and your mechanic are all potential private money
investors.
You might be wondering why anyone you know would be
willing to loan you money to invest in real estate. The answer
is that most people are not satisfied with the low rates of
return they are getting in so-called safe investments in savings
accounts, money market accounts, and CDs. And people have been
badly burned by the stock markets. They'd like to make more
money but they don't know a better way.
You can find private money investors by asking the people
you know if they are happy with the returns they are getting on
their investments. Then you ask if they would be interested in
earning higher rates of return through safe investments in real
estate.
If you don't know about private money for real estate
investing, it's highly likely your friends, relatives, and
neighbors don't know either. They simply don't know that they
can use the money that is sitting in low-interest savings
accounts, money market accounts, and CDs to invest in real
estate. They also could have substantial equity in their own
homes or IRAs that return tiny yields on mutual funds.
You can explain to them that you are offering a higher
rate of return than they could get through any of these other
so-called safe investments. They could earn 8%, 10%, even 15% by
funding a first mortgage on an investment property. One of the
greatest benefits of using private money is that you can create
flexible rates and terms. You are asking for them to invest in
a property that will guarantee them a higher rate of return than
anything they are doing now. And you are doing it by offering
a first mortgage secured by real estate.
After you find a person who is interested, your third
step is to find a title company to set up the paperwork for you.
You are not simply asking to borrow money. You are asking your
private money lender to fund a mortgage on your investment
property.
At this point, the title company will treat the mortgage
contract between you and your private money investor the same
way they would treat a mortgage contract between you and any
bank.
If you want to get started investing in real estate,
realize that the money you need is as close as the people you
know as you go about your daily life.
Using private money to fund your real estate investment
has two great benefits. First, it allows you make money with
someone else's money. And second, you are helping your private
lenders make more money by investing with you than they would
by keeping their money in the bank. This is a true win-win
situation for both of you.
So, if you would like to buy investment property but
don't have the money or the credit to qualify for a mortgage on
your own, the easiest and best solution is to look for private
money investors among the people you already know.