Do you want to buy your first investment property, but you aren’t sure how you’ll finance it? Here are 6 ways to get the cash you need to invest here locally in the Detroit area!
Making an investment in Detroit real estate is never a bad idea. With consistently strong returns, real estate investment is one of the best ways for people to build wealth. For many people, it’s the purchase of that first property that is the hardest part. Once you are able to clear that hurdle, investing in real estate becomes easier and easier. As you build up equity and experience, you will be better able to spot deals and have the means to quickly turn them into profit-producing investments.
Find A Partner
Partnering up is one of the best ways for first-time investors to get their hands on a good piece of property. It’s important that you work with the right people so that you can avoid any buyer’s remorse down the road. To find the right partner, you can join local investment groups, reach out to people in online forums, or reach out to the people you see who are doing a lot of the buying in your area. These more experienced buyers may not only be able to work with you, but they may be able to mentor you as well. When reaching out to more experienced investors,
Utilize A Private Lender
Working with a private lender in Detroit can help you to get the cash you need to make your first property investment. They will typically have different requirements for getting a loan than a conventional bank does. You will likely be able to get your money faster, without having to jump through as much red-tape.
Sell An Asset
Do you own land? Maybe an extra vehicle? Many people have a valuable asset just laying around that could be liquidated and reinvested into something of greater value. Often times these types of assets aren’t even thought about because they’ve been sitting idle for so long. Take a look at the things you own and what you have of value. If it isn’t making you money or deeply sentimental, consider how selling it could help you buy your first real estate investment in Detroit.
Save For Your Down Payment
Depending on where your finances stand today, saving for your downpayment may be easier than you think. In most cases, to borrow money from a traditional lender, you will need to put 20% down. Your first investment property doesn’t have to be anything flashy. In many parts of the country, you can pick up a property for less than $100k. While saving up $20k may sound daunting, it can be done when the right budget is put in place.
Utilize The Owner/Occupant Loophole
Many investors get their start with an owner-occupied investor property. Using an FHA loan, you are able to buy a property of up to four units. The catch is that you must live onsite for about two years. While multi-family housing may not be what you are looking for personally, by living there for a short period of time you will be able to achieve free room and board while putting money toward a multi-family, income-producing asset, that can benefit you for years to come. For many investors, the trade is often worth it!
Single investors who want to buy their first home or investment property can apply the same concept to a single-family home. By renting out the rooms to friends or family, you’ll be able to pay your mortgage, possibly living for free. Down the road, you’ll be able to rent out the house in its entirety or you will be able to move into the property yourself and your future family, with much of the balance owed already paid off.
Get A Home Equity Line of Credit (HELOC)
A home equity line of credit or HELOC can help you purchase your first investment property by providing you with a loan that is secured against the current equity you have in your primary residence. It is also known as a second mortgage. Unleveraged equity is basically money that is just sitting there. When you use a HELOC to buy an investment property in Detroit, you are putting that money to work for you, which will pay off in the long run. HELOCs can be secured rather quickly and offer very competitive interest rates.
Purchasing your first investment property in Detroit is a big deal! At Sell Inherited House Detroit, we can help you to reach your investment goals by helping you find the perfect property. We offer discounted real estate in Detroit, working with investors or people looking to save money on a home of their own. When you are ready to buy a house in Detroit, find out how Sell Inherited House Detroit can be of assistance.