Finding financing questions for a newbie

2 Replies

Hello everyone,

I am am relatively new to this and

I would greatly appreciate any advice or suggestions anyone has to offer as I am stuck in a rut. Recently I finally got the courage to turn the knowledge I've been accumulating the past year and a half of me discovering my love and passion of real estate into action and start looking for deals, looking for deals with NO idea on how I would fund them. I believe I have found a great deal and have run numbers obsessively to make sure. I was curious about private money lenders and loans and partnerships and how they would work in this instance. If I found the deal should I look to these sources for just the down payment? If so would I repay the loan of the down payment through monthly payments on top of the mortgage that I secure? Or do they finance the entire purchase and I pay them back essentially taking out the mortgage with them? Or is it that they become an equity partner and I pay them monthly on top of them having an stake in equity or is the equity the term of the deal essentially like they finance and receive half or whatever percentage of the equity that was agreed upon? I've been reading that private money lenders are short term lenders and I am looking to buy and hold. If not, what other sources of funding would anyone recommend for my situation? Any advice is appreciated.

Dominick,

As a new investor your best bet is to get "Pre-Approved" with a bank/lender. They will review your employment and income and give you a loan based on what your income and credit. There are programs that will allow you to buy your first home using down payment assistance for a primary home. Buying a duplex for example is a great way to use the BRRR method by living in one unit for period of time. That way you can get 100% financing with no money down!

If not a primary you would need to put  20-25% down depending on property type.

@Jason Wray

Thank you for your response. I have utilized my FHA loan option this past year for the home I currently live in. Initially it was to be an investment property but I lost my job and decided to keep it as a primary residence until I can rebuild my finances and credit.i have since had my surgery and have found another job but for that 6 months I couldn't work, I had 2 mortgage lates and my credit took a huge hit but it's being repaired through me paying my debts down and paying bills on time since. I also have not been on my new job long enough according to my bank. I am waiting the necessary time period to pass after the mortgage lates to try a more conventional route; also I lack the capital is my main issue. Eventually my primary residence will fulfill its intended purpose or being a rental but I've to get some other things in order with it first before that is feasible. With this being the case, I opted for more "creative" methods of finance.