Which is the best option for financing real estate investments today; crowdfunding or rental property loans? Or can the two better be used together for superior returns?
Crowdfunding continues to be a hot buzzing topic. The adoption of crowdfunding by major brands, and emergence of new real estate specific crowdfunding platforms, along with masses of press coverage has made this form of fundraising even more popular.
Crowdfunding can be a great way to finance all types of things from honeymoons to new business startups to acquiring portfolios of single family rental properties. It doesn’t require putting personal credit on the line, can help spread risk, and promises to be a fun adventure.
However, crowdfunding can be far more intensive and expensive than most realize. Media stories of new startups landing millions via crowdfunding make it sound like a guaranteed path to overnight success and easy money.
What the media often fails to tell is that these ‘overnight’ successes are often the result of months of planning, and the culmination of thousands of dollars in marketing and the work of international specialist teams of marketers. Even the most popular crowdfunding platforms openly admit that their success rates are barely around 50%.
Taking rental home financing instead means far better odds of success, minutes instead of months trying to raise money, and the ability to retain control versus sharing it, and taking on the responsibility to other partners and investors.
New blanket mortgage options from RentalHomeFinancing.com have transformed the financing landscape making it far more cost effective and efficient to borrow to acquire portfolios of single family homes.
However, innovative real estate investors could combine both of these leverage options together to enjoy the best of both worlds. Aggressive investment property lenders are willing to allow creative deal structuring. So for example; an investor could secure very attractive base financing at a lower LTV in a long term mortgage loan, and then compliment the project with the media buzz, risk sharing, and support real estate crowdfunding can provide, while gaining more liquidity for improvements or marketing a new development.
Rental Home Financing’s loan products are specifically tailored for rental property investors that have been acquiring houses over the past several years. We understand the limitations Fannie Mae, Freddie Mac and local banks have on this type of property.
Everyone you speak with on our team, is dedicated to serving this underserved segment of the market.
New Rental Home Financing programs offer real estate investors incredible access to attractive blanket mortgage financing for growing and optimizing performance of their portfolios. There can be many advantages to these new investor property loan programs, but some of the terminology and features of these ‘Buy to Rent’ mortgages may be new to many.
So what do they mean and how do they help?
Rental home investors with mortgage free income properties are flocking to take advantage of a new loan program which enables them to access pent up equity.
So why are sophisticated buy and hold real estate investors rushing to refinance under this new mortgage program, and why do all those with free and clear properties need to act now?
New residential blanket mortgage loans from Rental Home Financing offer landlords with at least 5 income properties to refinance and receive cash out, at incredibly low interest rates. Many investors have acquired rental homes for cash recently, and while it can feel cozy to some to be mortgage free, there are some very vital reasons for acting on this opportunity now.
There is really only one way for interest rates to go. That’s up. For long term buy and hold investors it doesn’t matter if that takes 2 months, or 2 years. Just a couple point hike (and it will go much higher than that), will make hundreds of thousands of dollars difference in borrowing costs over the time holding even a small portfolio, or single property. That means those that may need to refinance within the next decade or two will be far better off doing it now.
Liquidity is critical to investors. It provides a cushion for unexpected damage and replacement needs, as well as personal needs such as major health expenses. When crises happen it is normally difficult, if not impossible to refinance. That means at least lining up an active credit line now can be invaluable.
Being able to recoup capital means being able to take advantage of current opportunities, and lock in great ongoing passive income and wealth building. Those who delay will suffer reduced returns due to a variety of market factors.
Access to more expansion capital now also means the benefits of greater diversity in a portfolio. This helps to keep income consistent, and protects investors from everything from local job market shifts to natural disasters.
All of the above combine to reduce risk for rental property investors that sensibly leverage their properties now. Additionally, it can work to preserve credit by keeping lines clear and ensure working capital in a pinch.
Smart and modest leverage is a great tool. Those that hide behind the mirage of comfort that a mortgage free property are unfortunately deluding themselves. There is really no such thing as ‘free and clear’. There will always be property taxes, insurance or repairs. So why deny yourself of the best benefits of leverage?
What are blanket mortgages? When should they be used for financing income investment properties? What features and terms should real estate investors be demanding when shopping for a blanket mortgage loan?
Blanket Mortgages 101:
Blanket mortgages may be a new concept for many residential real estate investors. However, they have been used for decades by builders and developers, and commercial property investors.
Blanket mortgages are used for funding more than one piece of property, in one loan.
Imagine if a builder or developer needed to arrange individual lot and home financing for every property in a new subdivision, or condominium building. It would be a paperwork nightmare, not to mention slow, inefficient, and extremely expensive to the point of being cost prohibitive.
Why does every Realtor need to be turning their clients onto bulk rental home financing and blanket mortgage loans?
A real estate agent’s financial connections, the ability to truly provide their clients an edge in the market, and capability to innovate and create new business is critical for surviving and thriving in the industry.
There are an estimated 2 million real estate agents in the U.S. Each and every one of them has the ability to show prospective buyers hundreds if not thousands of properties for sale. They all know how to write purchase contracts. That’s on top of all of the other sellers, investment firms, individual investors and builders marketing their wares and services.
Recent data from the National Association of Realtors (NAR) shows mortgage financing no longer the top challenge for Realtors selling more homes, but it remains up there. Our competitve rates help insure this. Cash buyers are at a record high, as percentage of U.S. real estate transactions. The amount of capital coming into to U.S. and being freed up from within it, is only likely to grow substantially over the next few years.
What’s the best strategy or tool for enabling real estate investors and entrepreneurs to ‘hack’ their way to the next level?
Is it social media, finding the cheapest foreclosure properties on the planet, having the contacts to manipulate auctions, or simply access to vast amounts of capital and better real estate loans?
“Growth hacking” continues to be a popular buzzword. Real estate and mortgage debt continue to be recognized as the best vehicle for advancing wealth and achieving both short and long term financial goals. So what is growth hacking in real estate, and what’s the best way to achieve it?
Growth hacking, is essentially the idea of fast tracking toward volume and goals. Unfortunately, there is a lot of junk out there under the labels of ‘growth hacking’ and get rich quick real estate investing schemes which often don’t do much for serious investors at all. More often than not they lead to distraction and thousands of dollars in waste, or worse. There are five figure training course which provide little value, and books written by amateur by fabricate author personas without a clue, as well as volumes of simply poor quality misinformation.
Those investors really serious about getting to the next level, financially and as a player in the real estate world need to stay focused on just a few things.
The simple solution to all of these is leverage.
It’s not fancy tech apps, $40,000 seminars, or rivalling Miley Cyrus or Ashton Kutcher on Twitter.
Efficient, effective and intelligent leverage can provide real estate investors with all the fuel they need to reach their goals, reach them quickly, and in a sustainable way they’ll be able to replicate and enjoy the rewards of for the long term.
Financial leverage and working capital with reasonable rates, LTVs, and processing, reduced paperwork and bookkeeping burdens, and streamlined financing options for expansion are all investors really need to capitalize on the current market and expand their real estate empires.
Blanket mortgages and bulk rental property mortgages from investor friendly lenders can facilitate true, and ethical growth hacking with great investment property loans. Find out what capital is available to you now…
Some media outlets and green property investors have recently griped about increased competition in the market, while others see increased, and even more opportunities opening up. Matters not if its a blanket loan, first single rental home, or commercial property, we got you covered. Whether coming up short on inventory or flush with more deals than you can handle no one wants to leave extra money on the table.
Those that know how to find more room in every property are able to find opportunity where others can’t, and position themselves for maximum per deal, annual and overall returns.
Investing in real estate with smart tax strategies and knowing how to negotiate out liens and other fees others don’t know how to, have a significant advantage in the market today. However, even simple tweaks such as using superior investment property loan programs and lenders can make a substantial difference in profit margins and net returns.
To find more spread in each deal investors need to reduce acquisition costs, and, or increasing operating cash flow. Blanket mortgage financing can enable rental property investors to do both.
New Rental Home Financing programs offer real estate investors incredible access to attractive blanket mortgage financing for growing and optimizing performance of their portfolios.
There can be many advantages to these new investor property loan programs, but some of the terminology and features of these ‘Buy to Rent’ mortgages may be new to many.
So what do they mean and how do they help?