Real estate investment loans:

by | Apr 5, 2012 | Investing

Top Of The List



Real estate investment is a very good way of making big money. This is why lots of investors look towards real estate, they know that it has the ability to provide high returns and secure their financial future. Real estate is a booming market at present. The increasing investment in real estate market can be attributed to the steady increase in the demand for real estate.

Understanding the mass psychology: It is extremely important to understand the requirements, as well as the psychology of people connected to real estate. People are generally more inclined towards renting property than buying it. This is because renting requires a much smaller amount of money than buying property. However, people who have the capacity to buy would not go for rentals. But then the number of people who can afford to buy property is quite small. Understanding the psychology of the masses on similar lines would help investors to chalk out ways in which the maximum number of people can be satisfied.

Loan facilities: If you don’t have enough money for real estate investment, then you can take a loan for the purpose. There are numerous loan facilities available in the market. They are the following:

Real estate investment loan: These loans can be obtained from traditional sources like savings and loan associations, commercial banks and savings banks, credit unions, among others. Loans are also offered by individuals who have the money and are interested in making profits by way of interest from the loan.

Investor’s real estate loan: There are numerous options for a real estate investor looking for loans, other than using mortgage financing. Bonds, sale lease back, security agreements syndicate, equity financing and exchange are alternatives to mortgage financing. These are however meant for very large financiers, substantial institutions and very strong tenants.

Sub prime real estate loan: These loans are available for cases in which the investor gets a bad credit or makes very less profit out of his investment. A person who has retired or has low income can also make use of this facility. The interest rates of these loans are steeper, when compared to other consumer’s requirements.

Bridge real estate loan A short term loan is called bridge real estate investment loan. According to this scheme, until the loan is paid back, the principal cannot be paid. This is a short term loan, which is actually used for repositioning and renovation purposes.

Government real estate loan: One of the most popular government real estate loans is the federal housing administration i.e. FHA loan. This type of loan has numerous benefits on offer. It does not have any income limit. However, the mortgage insurance premium amount is higher for this type of loan.