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Creative Financing for Investors Paulie Sabol
For decades, the golden rule of property investment was 80-20, with 20 percent going toward a down payment, and the remaining 80 toward the loan. Now, there are dozens of ways to finance the purchase of a new property, whether it is for pure investment or a primary residence.
One of the most common finance options is the acquisition of a second mortgage. Buyers generally come up with a mere 5 percent, borrowing the remaining 15 percent on a separate loan. The buyer is not responsible for nearly as much money out-of-pocket, but the interest rate on this second loan is usually quite high. In addition, since the buyer has not met the standard 20 percent on his own, lenders almost always require private mortgage insurance (PMI), another hefty expense... | |
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