You might want to rethink how you’re buying real estate if you currently use your own money and/or credit. At the end of the day, it’s a personal decision. When it comes to real estate investing, it’s nobody’s place to insist one way is better than another. But if you are using your own money and credit, there will likely come a day when you don’t have any more money or credit.
At some point in time, lenders will stop loaning you money to buy real estate if you’re using your credit to take out mortage after mortgage as you buy more and more houses. How soon lenders start refusing to loan you more money could be after a few houses or maybe it won’t be until you’ve bought 20 or more but lenders will not loan you an infinite amount of money.
Taking out a bunch of loans also puts your credit at risk. What happens if you can’t make the payments on just one of those loans? The worst case scenario plays out more often than you might think with tenants disappearing and leaving the house in a state of disrepair. Too many investors have learned this lesson from the school of hard knocks. Don’t be the next one.
Buying houses “subject to” is what savvy investors do. There are more motivated sellers willing to have you take over their payments to get rid of their problem than you can shake a stick at and there not that difficult to locate. Finding is a simple numbers game. Buying real estate in this manner is using leverage in the form of OPM (other people’s money) and you won’t even have to deal with lenders anymore.
There’s no reason for lenders to check your credit when you buy property “subject to” the existing financing. That’s one of the many advantages of learning and using creative real estate financing. Whether you take out mortgages or use creative financing is really a personal decision but you’ll learn the art of buying houses “subject to” and many other useful techniques in my Real Estate Investing Online Home Study Course.
Do you want to increase your income by ?investing in real estate To discover the six simple steps to doing just that visit the Real Estate Investing Blog
- Robert Phillips