Is it better to take a HELOC? Loan from an investor? If so, how do I find one? What ultimately will keep me away from the 10 percent interest the mortgage broker is trying to set me up with?
2007-03-10 13:42:20 · 7 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
All good answers. Given what you have all collectively told me, I'm getting ripped off....because I have good credit and good income. I already own one home (with good equity) and I have plenty of liquid assets.
2007-03-10 14:29:40 · update #1
Find a house that the current ownder is willing to do "owner financing". Usually you can write a contract and agree to a interest rate. The owner might consider 5 or 6 % interest. You can always ask!
Also, the bank is quoting you a higher interest rate simply because you are buying investment property. Believe it or not, they still consider you a "high risk" loan; no matter what your credit rating is.
2007-03-10 14:00:33 · answer #1 · answered by kelbell80 2 · 0⤊ 0⤋
Rates are all about risk.
If you are seeing 10% then it is a combination of any of the following problems.
Poor Credit
Low Assetts/downpayment
Limited supporting income
Broker making too much money
Any of these apply?
Tell us more we may be able to point you in the right direction.
OK So you have good credit plenty of assetts and solid income. A broker can get you a rate better than 10% Provided you are putting a good down payment 5-10% into the purchase. If you are doing one loan for 100% 10% may be where it is?
Good Luck
Buy Right or it wont be an investment it will be a liability..
2007-03-10 14:00:39 · answer #2 · answered by The Loan Professor 1 · 0⤊ 0⤋
I personally buy rental properties with regular 30-year fixed interest loans. The payment is slightly higher than other loan types, but I like being locked into that payment forever. Rents go up eventually--- I don't want my payment going up too.
If your credit score is good, as you say, you should find a different mortgage broker.
Check if there is a Multihousing Association in your city (there usually is.) They might have some leads on good mortgage brokers for investment properties. They will also have standard leases and other forms you will need.
2007-03-10 17:47:48 · answer #3 · answered by axaroth 3 · 0⤊ 0⤋
it all depends on what type of investment you want to do. If you are going to flip the property in question, get an interest only loan. That way, your monthly carrying costs will be low. If you are doing a rental, pay cash for the home. That way, any money coming in will be profitable..meaning you will not have to pay mortgage on a house that you rent.
10% interest on a home loan is a ripoff (if its an interest only, its ok). Don't use the broker.
2007-03-10 17:12:45 · answer #4 · answered by The_Donger 3 · 0⤊ 0⤋
10% interest for real estate is a joke. If your credit is good enough, simply look into a conventional home loan. There's no law that states you can't finance an investment property with a conventional loan. Some loan programs may prohibit you from doing this, like Fannie Mae, but there are plenty of banks out there waiting to lend you money.
2007-03-10 14:07:02 · answer #5 · answered by josh m 4 · 0⤊ 0⤋
The cheapest is cash, but that isn't what you are asking.
You will have to search around for better interest rates. The more you put down, the cheaper the interest rate.
I am suprised at the 10%, as I've seen much cheaper rates.
There are other brokers, I'd look them up. I have a flier from one here.
http://www.grfinance.com
I've never used them, but take a look. It can't hurt.
Good Luck
2007-03-10 14:01:43 · answer #6 · answered by A_Kansan 4 · 0⤊ 0⤋
If you are everything you say you are go to your bank and you will get a better rate than 10% today.
If you aint everything you say you are go talk to your mama for an interest free loan.
2007-03-10 16:02:37 · answer #7 · answered by jazzpaging 5 · 0⤊ 0⤋