Real Estate Investing: How To Find The Money To Get Started
This year’s historic events have driven more interest in real estate investing and need to switch investment strategies than we’ve seen in at least 12 years. Where can you find the money to keep going or get started?
If anything real estate has only become stronger and has headed up faster as a result of recent events. More people are on the move than ever. Everyone from individuals to investment funds are looking for the safety and perks of real estate.
However, even those who were doing very well in real estate pre-COVID are switching up their strategies. Everyone wants to protect their capital, and needs more income. Many flippers and landlords are switching to real estate wholesaling. It is also the perfect strategy for those who are just starting out and may have lost jobs.
Of course, common wisdom says “it takes money to make money.” It doesn’t necessarily have to be yours though. So, where do you get it from?
IRAs & 401ks
New CARES Act rules and other changes due to COVID-19 are allowing individuals to tap even more of their retirement savings to move it to safety in other investments, or borrow against it. Those with 401k plans can now reportedly borrow up to 100% of their account balance, or $100k. This money can be used to invest in real estate. You may also have a couple more weeks to contribute to these plans and reduce your taxes, while improving your income. If this money is currently in the stock market, it is still exposed to some serious potential volatility.
If the Dow Jones just drops back to 2015-2016 levels, it could lose another 7,000 to 10,000 points. Or close to half of your portfolio value.
Partners
Partnering up is a common way to get started or grow in real estate. A few people can pool their money together and split the rewards. Or course, right now, many people are trying to preserve cash and may be leaner on savings than they have been in a while.
Traditional Mortgages
Traditional mortgages and even hard money loans could be a way to fund a move into real estate. Unfortunately, major banks have tightened up their criteria. Some have stopped home equity lending. It is noticeably more difficult to borrow from these sources than at the beginning of 2020. Though interest rates are extremely attractive if you can borrow.
Transactional Funding
In contrast, transactional funding is still plentiful. The best transactional funding lenders are still offering 100% financing, and credit and appraisals or lost jobs aren’t a problem. It’s a super easy way to fund your deals, while minimizing risk, and maximizing upside potential and returns.
Get in touch today to find out more about getting your approval, proof of funds letters and VODs to get more of your house offers accepted.
Plus check out our referral program that pays you when you share this great resource with others.
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"I want thank you for the excellent service I received from Best Transaction Funding.The quick response I received from your company from the beginning of the transaction and to the end was unbelievable. I also want to give a special compliment to you as well. You went to great lengths to keep me informed and gave my title company all the information they needed to complete a successful closing. I cannot express how thankful I am. Such service builds great working relationships. I will definitely recommend Best Transaction Funding to all my fellow investors. Thank You."
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