You don’t need to come into big money to get started in real estate investing. What you need is to realize that there are lots of different options out there when it comes to finding money. During your investing career you will have to get creative or you will not have a career. This is not a traditional 9 to 5 and it demands that you think outside of the box and take some risks.

Owner Financing

I like this one because it give you the most options. It allows you to solve other peoples problems and ask for a favor in return and make some money in the process. Good terms on a loan can be that favor. This allows you to keep things off the books which gives you more options and allows you to close quickly, often in a matter of days. This is where creative financing lives and has huge potential.

Traditional Bank Financing

This is what most people think of first and it is probably the worst way to buy real estate but often the most familiar and straightforward. Banks have annoyingly strict requirements and it takes weeks to fill out all the paper work and wait for approvals. This is not the ideal method of purchasing investment property but sometimes it the only way to get your hands on the cash, and if the deal is good enough, go for it.

Friends and Family

Many a fortune has been made on a family loan and many a Thanksgiving dinner has been ruined by similar loans. Be on the same page as family or friends that give you a loan and make it a favor for them that you are getting them into real estate. Make it legitimate and legal for both parties protection, hand shake deals make you feel good but are not the best idea. With this type of loan you can really get good terms and lots of flexibility. Enter into these arrangements carefully, ruining family or friends ships in the name of profit is not wise.

Credit Cards

As frightening as it sounds credit cards can be a great option for fast cash. If you need short term cash and don’t have another option go for it but be certain of the deal. Make your money when you buy not when you sell and make sure you will be able to pay off the balance as soon as the deal is done. It is common to finance the improvements to a flip on credit. Risky yes, profitable yes, for everyone, NO

Hard Money Lenders

Similar to credit cards but a little more cut and dry. These are private investors with lots of cash. They can close fast but for all of this convenience you will pay a hefty price of 15-25%. Dangerous yes, but if used wisely very effective. Look through the yellow pages or contact your local real estate club to find these individuals.

Personal Savings

The old fashioned way is coming back in style. Spend your own cash and not a penny more. Borrow against your retirement, spend your retirement, or even your kids college funds. Hey, if the deal is right you make your money when you buy and it is nearly impossible to loose your money in the long term. As has been said before real estate is the single most certain way to get and stay wealthy in America. Make your money how ever you make it but hold it in real estate.

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