If you are a newbie in real estate investing, it is prudent to make use of expert advice when buying a property. If you go by the advice of expert brokers, you need an experienced team to make sure your investment is sound and gives attractive returns. This team should include not just a financial planner and a broker but also an attorney and the team should be in place at the planning stage rather than waiting until you have found a property. This team will make sure that your portfolio is diverse so that your risk is spread, and you have liquid assets as well as long term investment properties.
All cash offer is not going to help
Many investors believe that when they make an all cash offer, the owner will get excited and instantly accept the offer. This is a misconception really and deals do not happen with all cash offer. Also, a new investor is mostly not able to pay in cash because of paucity of funds. Banks always take a close look at your financial situation and credit report before taking a decision. This is where your financial planned comes into picture. His advice proves crucial when taking a plunge into real estate investing.
Experts are able to analyze the ever-changing market conditions
Real estate investment field is changing fast ever since it was hit by recession in 2007-8. This is the reason why need a team of experienced professionals to guide you at every step of your investment endeavor. These professionals can anticipate better because of their experience. They can also adapt and respond to the changing market conditions better than you. They understand the importance of showing you as a low risk proposition to your lenders so that they rely on you and agree to finance your projects. Bankers are mostly interested in reliable and trustworthy investors who can bring recurrent income producing investment projects.
It is not easy to work with a financial advisor right away. You need to develop a relationship so advisor can understand your investment goals, current financial situation, and the kind of properties you are interested in. Therefore, you need to have your financial advisor in place much before you start to search for properties.
Presenting you as an ideal investor
If you are a newbie, it is easy to ignore or overlook the importance of your credit report before approaching a lender for finance of a real estate deal. Your financial advisor knows how to plug in the loopholes and avoid mistakes at the planning stage. He will make sure that you are ready to approach a lender for the finance of a project. He will present you as a reliable and sound investor in front of the lender to maximize your chances of securing a mortgage at the best possible terms and conditions. He will pull latest credit reports from all three credit rating agencies and get discrepancies removed from your credit report. Getting mistakes corrected by these agencies is a time-consuming process and it can take up to 6 months to obtain credit reports with little or no red marks.
As an investor, you should be fully aware of the various closing costs and be prepared to pay them easily. There is no need to feel excited with just the asking price as you must pay all the closing costs. Also, the journey of an investor only begins with the closing of a deal and does not end with the purchase of a property. Your team comes into action once the property has been purchased and readies the plan of action for its renovation and marketing.
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