Investment mortgage, which is what most people call it, is a loan that is used to buy residential or commercial real estate. There are mortgage lenders who are willing to give money to people who want to buy real estate. Even though mortgages can be used for both homes and businesses, mortgage lenders see homes as "safer." In this case, the home is the collateral. Mortgage lenders can feel safe if they think that no one is likely to stop making payments on a loan for which their home is used as collateral.
Real estate is always a good place to put your money. You can either buy a home as an initial investment, rent it out for a few years, and then sell it when its value has gone up a lot. If you don't want to sell, you can also use the value increase to get a new mortgage loan that you can use to buy another property. This is what most people do. The key is to find a mortgage with a small or nonexistent prepayment penalty. You pay off the loan when the value of the property has gone up a lot and then sell it for a profit.
Since you aren't an experienced real estate investor who has worked with a mortgage lender for a long time, you should look around for mortgage loans with lower costs. The first thing to look at is, of course, your credit score. Once you are approved for a home mortgage with a very low interest rate, you can start investing in real estate. Finding a mortgage to invest in a home or business property is actually not that hard.
It is always a good idea to do a careful analysis of how much the property you want to invest in might go up in value. You have to pay off the mortgage and make money at the same time.
Even if you have bad credit, you can start investing in real estate. Even if you don't have a lot of money or a high income, you can still buy real estate on a mortgage and make money from it. First of all, don't look at the success or strategies of the big players in the field. You are just starting out, so make small investments and keep your money separate. You'll soon figure out what works for you.
The safest thing to do is to focus on the property's value going up. Renting it out should only be a second choice. Keep the winners and get rid of the losers. Even better, don't catch a loser at all.
All rights reserved. Copyright (c) 2006 Joel Teo. (You may publish this whole article as long as you include the following author's name and only live links.)
