Monthly Archives: March 2018

How To Get An Investment Mortgage

Getting Your Investment Mortgage

Getting an investment loan to buy a property is not a very difficult thing in the consumer friendly environment we live in if you do some research and find a well qualified mortgage broker. In fact, even in Australia it was the overdrive of the banking and financial institutions in giving away loans to even sub-prime customers that led to the recent global recession having an effect on today’s lending policies. Though, banks are considerably cautious in giving out loans today, with a few simple measures, it is still relatively easy to buy a property of your own by applying and getting an investment loan.

Steps To Get Mortgage:

1. Identify the amount of personal financing (deposit) you are ready to contribute when you buy a property. Banks today asking between ten to twenty percent deposit to be paid by the customer, and they would only fund the balance. Therefore, the higher the deposit is you are able to provide, the greater the possibility of getting a loan would be.

2. Always have more than one property to choose from, when you approach a bank. Every bank has its own policies when providing loans, especially with certain developments or certain localities. Also, if the property is too small in size, i.e. less than fifty square meters in size, there is a greater chance that your application might be rejected (see apartment loans here). Hence, have multiple options when approaching a bank in case you miss out on your first option due to a banks policy.

3. Make sure you know the value of the home you are purchasing. Its no good offering too much to have the bank tell you its not worth as much as your offer. Getting a valuation done by a qualified valuer is worth the cost involved. Its even worth trying to get a valuer from the a banks panel of valuers as to ensure they take some weight from the valuation. Once you have the valuation its worth remembering that its getting more serious.

4. Negotiate with the banker or get your mortgage broker to do it on your behalf on the term of the loan, the interest rate, the type of payments etc. Remember that even if the banker uses the words that it is our bank’s policies etc, it can still mean there is some scope of negotiation. It’s the old saying- You will not get if you do not ask!

5. At worst case if you did not apply with a very substantial deposit for your loan, be ready to provide additional collateral security by having another property you can use as an underwritten security (this is generally risky and not usually advised), or by providing additional guaranty in the form of a surety by a close relative. These are both confidence building measures for the bank and they would find it easy to process a loan with collateral security as they have control over more property with a an overall smaller loan in proportion.

Utilizing Investment Mortgages

Funding options like 100% development finance, bridging loans and investment mortgages are usually provided by companies in development finance UK. Each has its characteristics and appropriation in various property projects. If you want to enter the property industry, you can start out with investment mortgages. Commercial development finance can be too risky and costly for you. Likewise, 100% development finance is only for developers and investors who are capable of handling the stiff requirement.

By investment mortgages, novice developers have the potential to build property portfolio. But building up property portfolio by investment mortgages is not the only guarantee to a successful property investment career. Most importantly, it is also about knowing how to use it wisely. It’s a fact that property investments have its ups and downs; pros and cons, risks and rewards, all in one setting. And it is true whether the investment comes from residential development finance or commercial development finance or investment mortgages. There are times that your investment looks like it’s moving up, but there are also times as if your whole nest is slipping out of your hands. But still, the hard truth is, there is profit in property.

Securing competitive investment mortgages for your property portfolio can be one way of making huge profits fast only if you follow some helpful rules. These rules may even help you build the portfolio further and may entitle you to 100% development finance for development projects in the future.

One rule in building property portfolio is to consider locations. You may have heard of this many times, but location has major effect in your property investment. If you’re risking investment mortgages, you need to make a thorough research on places that you want to invest. You should look into the country’s political regime, economy, culture, economic potential, currency, stability, infrastructure, and basically everything that concerns the property development market and it’s potential. Next to finding the right location, you should ensure the property you’re buying is on prime sites. Be sure that the site is feasible for commercial property. Ensure that the spot is easily accessible to target consumers and that it is what is sought after by the people around it.

Apart from the locations and sites, you need to be sure that the investment mortgage is secured under a reliable development finance UK company. Use the expertise and professionalism of the specialist to get the needed investment mortgages. Also, if you’re investment is not under secure and stable company, you could end up with a costly mess.

The rules may sound simple but those are the only important rules for you to live by. Once you know this by heart, you will have a promising future in your property investment career.

Investment Mortgage

The first step when looking for a way to fund your investment properties is to consider how you are going to buy, PLUS, deciding on your exit strategy.

“Do you plan to ‘fix and flip’, rent the property out, or sell the home to another investor? Small differences in your loan could cost or save you thousands, depending on which type of loan package you end up going with.

Which investment mortgage is best for you?

It all depends upon your personal financial position, how soon you plan on paying off the loan, either by refinancing, selling or cashing out, and if you have a variable rate loan, it depends upon what happens to interest rates over the period that you have your mortgage in place.

Your options for an investment mortgage will also be limited by your income, the down payment you make and your creditworthiness. If you have lost a property to foreclosure, or have less than good credit, in this market you may need to consider using creative financing rather than getting a traditional mortgage.

A good mortgage broker or lender will help you compare and contrast the various mortgage programs, and you may also want a financial or investment counselor and a tax professional to help you make the best choices.

The typical investment mortgage today won’t allow you to get into a real estate deal in a highly leveraged fashion. If you do have the money to make a large down payment then this is less risky, and with fixed rates at historic lows this can be one of the best ways to invest your extra cash in today’s market.

Creative Funding Methods for Investors Who Can’t Get an Investment Mortgage

OK, so how do you get the funding for your investment properties if you don’t have a big down payment or perfect credit? There are a number of creative methods you can use that don’t require you to get a traditional loan.

My favorites include the Sandwich Lease Option, Owner Carry Financing, and buying while leaving the Existing Financing in place. With each of these methods, you’ll need to make sure that you find a motivated seller first. Ideally this would be a home owner who is just looking to get out from under their payments. In addition, you’ll need to make sure that the property is able to generate enough in rental income to cover the existing mortgage payment and other costs of owning the property.

Whether you end up getting a conventional loan, or learn how to use creative financing so that you don’t need an investment mortgage, the most important thing is to get started now while real estate is available at bargain basement prices. Look for an investment club in your area that you can join so that you have other investors to hang around and network with. Dedicate at least 3 to 4 hours a week to focus on learning more about your market and how other investors are able to buy real estate creatively without using a traditional investment mortgage.

Buy to Let Mortgages

Buy-to-let mortgages are also known as an investment mortgages which are designed for borrowers who wish to let their property out to a third party. An increasing number of people are investing in property these days. There are now plenty of competitive buy to let mortgage deals which can help get a favourable deal. They are aimed at the buy-to-let market which ranges from special offer buy to let mortgage deals to fixed and variable rate options. Moreover, mortgage lenders will also assess buy-to-let mortgages on the earning potential of the property.

If you wish to buy a buy-to-let property, you can easily do it. You can also make use of buy to let mortgage calculator which will help you asses the amount of money you may spend on buying a mortgage. Over a period of time, an increasing number of people are investing in buy-to-let property. It is also seen as a long term investment opportunity. You can get profitable returns on this kind of property. Buy to let mortgages can be arranged with no broker fee and also at lower rates. Before buying such kind of property, you must get all the relevant details about the property.
There are numerous competitive buy to let mortgage deals in the market which are specifically intended at buy-to-let sector. These range from special offer buy to let mortgage deals to variable and fixed and rate options. Getting the best deal on buy-to-let mortgages will help determine whether you will get an affordable buy-to-let investment property.

There are various reasons for the growing popularity of buy-to-let mortgages:

o They are long term investment property deals.

o They carry low interest rates. The buy to let mortgages offer an attractive alternative investment option.

o There is growing demand for rental accommodation due to a rise in the overall population, high divorce rate, and a growing number of higher education students

o The availability of competitive, specifically-designed, accessible of buy to let mortgages by lenders has made it easy for the landlord.

The best time to buy a buy-to-let property is as soon as your offer has been accepted for your property. Soon after making an offer, you may not be able to get acceptance. Buy to let mortgages are relatively straightforward to arrange. Generally, the competition for buy to let properties occurs when landlords are buying property “off-plan”. This happens when a property is being built and flats, for example, are sold out of this building.