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Top Searches: • credit investors • credit investors needed • investors with good credit scores • credit investor • good credit investor • i need a credit investor • credit investor opportunities • roi rental property • credit investor for real estate • real esate credit investors • need credit investor • investors credit • how to find credit investor for real estate • real estate credit investors • how to buy good credit • roi rental • roi buy real estate llc • roi for investors • what kind of roi on rental property • a credit investor • credit investor needed • using investors credit • purchasing a home using a credit investor • roi on rental property • investors property roi • credit score to buy rental property • credit investor with 720 • real estate investor credit score 720 • need good credit investor • using other people credit to buy real estate • credit scores needed for commercial real estate • how to buy properties with good credit • | Strong credit saves real estate investors money on mortgage finance costs. A good credit score, along with other credit and mortgage qualifications, means that investors can pay lower fees for financing, such as points and interest charges. Also, good credit scores help you avoid garbage fees associated with non-prime loans.
However, the real money making difference for real estate investors comes into play in the return on investment (ROI). When you build up your credit score over 720, you open the way to finance multiple investment properties using other people's money. Today, you can get investment property financing for as little as 5% down when you meet the qualifying credit requirements. This means that your ROI on your cash investment for the down payment can be significant.
For example, let's take a home I found in Bradenton, Florida. Built in 1999, this 3 bedroom, 2 bathroom, 1600 square foot home looks like a great buy for only $219,000. Assume that the property could be purchased for $215,000. With strong credit, the 5% down cash investment of $10,750 buys into the appreciation value of $215,000. A lower credit score would mean that you'd have to put 10%-25% down or more, which lowers your return on investment. You would need $21,500-$53,750 down to buy into the same $215,000 appreciation investment. In this case, your ROI for your cash outlay would decrease significantly.
Of course, other factors like carrying costs affect your investment capabilities. The point, get your credit score over 720 so that when you're ready to buy investment property, you get the best return on your money.
Copyright © 2005 Jeanette J. Fisher. All rights reserved
About the Author: Jeanette Fisher, author of Credit Help! Get the Credit You Need to Buy Real Estate, and other books, has researched mortgage credit qualifications and credit scores to finance multiple investment properties. For free "Credit Tips for Mortgage Financing" report, see http://recredithelp.com/
Source: www.isnare.com
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