People always talk about financial freedom, Is it hard to achieve? Here is a way that many people practiced and succeeded- buying investment properties. Can’t wait to wet your shoes? keep in mind some important tips:
First, check your financial status to ensure it is stable, because you should have enough money for down payment and closing costs. The money either from your savings or from your present residential house, for example, cash out refinance.
Second, get pre-approval from banks or mortgage bankers to know exactly how much you can afford before you start to search your investment properties.
Third, calculate your required ROI( return on investment) depending on your personal needs, but usually 10% is a good match.
Fourth, where to buy ? that’s a critical problem. We all know that the lower the price you pay ,the higher your ROI . People always confused owner occupied property with investment property. They pick the property according to their personal preference without or less considering ROI. For example, if I want to buy a home for myself to live, I will choose a community with good school district, safe, quite, and thus I would pay premium for that. But for the rental property, has it to be in a good school district? not really. The reason we buy a investment property either for rental income or property appreciation or both, so we should put our eyes on the areas where working people like to live and do research to find good deal- a deal of less than market value. It ‘s much more easy saying than doing . A good deal needs hard working, careful research and even a little bit of luck.
Last, after you find your investment property, it is time for you to shop for the best rate for your property. The better way is to contact multiple lenders, comparing rates and terms, as well as the closing cost and other fees. Remember, the money you save is the money you earn!