Do you want your middle schooler reading more? Mid-Columbia Libraries offers Accelerated Reader (AR) books searchable by leve... Read More
Beware of Taking Loans for Homes for Sale
What’s the most perplexing and frustrating situation that a new (and sometimes, even experienced) real estate investor finds himself in? Undoubtedly, it’s getting the deals funded. Very often, it happens that when a real estate investor wishes to close a great deal but has difficulty getting the money to do it, he might inevitably resort to taking a loan. But sometimes, that could get an investor into really big trouble!
Options to remember before accepting a loan
- Originating loans involves certain fees and costs. Make sure that the fees are not too excessive and calculate the fees once again to ensure accuracy.
- When the investor borrows a loan with less-than-perfect credit, he needs to pay a slightly higher rate of interest but it should be always ensured that the interest rate is not too exorbitant. The investor needs to have a thorough knowledge of the current interest rates. In case the lender demands more than six percent above prime for a first mortgage loan, he should look for better options!
- Watch out for prepayment penalties! The investor could lose a significant chunk of his profit through prepayment penalties when purchasing a home. They could be a real hassle if he wants to refinance in a year or two or if he sells the property.
- Don’t take loans which cover insurance policies like life or medical insurance.
- Be careful if the contract involves a binding mandatory arbitration clause. If the investor agrees to a binding arbitration clause, it means that he loses all his rights to sue for any reason if a dispute arises.
- Be extremely vigilant and cautious if the lender wants any upfront fees or soliciting applications. It means he is a fake trying to fool others!
- The investor must have a comprehensive, thorough knowledge on all aspects of borrowing a loan. He should be familiar with all terms and procedures related to product mortgage loans as well as payments.
Some times, it so happens that an investor purchasing homes for sale gets the deal done with disagreeable loan terms. In crucial cases, the investor would even be prepared to pay a higher rate of interest as he well knows that his real estate property will generate enough money to cover the debt. In short, before taking a loan, it is important that the investor precisely understands the terms of the loan and makes a prudent decision that will guarantee his success.
Call us, 509.438.9344, Email us, or fill out the contact form below.
We respond right away! -Colleen & Joe Lane, Realtors®
Latest From Our Blog...
Attend an open mic for all word lovers at the Paper Street Brewing Company for Words in Progress. Poetry, prose, memoirs, jou... Read More
Mid-Columbia Reads: Travelogue of Africa with Doris Mager | Mid-Columbia Reads celebrates Scottish author Alexander McCall Smith wi... Read More
In a time when Fall Carnivals are requiring entrance fees of $20ish, the Richland Public Library and Hapo Community Credit Uni... Read More
Tips and Tools for Smart Aging: Mid-Columbia Libraries' Kennewick Branch hosts the following workshops: Nutritious Meal ... Read More
Friends of Mid-Columbia Libraries hosts its fall Giant Book Sale Oct. 26-29 at the Kennewick library. Friends members get early acc... Read More
Dayton on Tour Downtown Dayton|Dayton, WA|Oct. 7, 2017 4 Historic Private Residences will be open to the public to ente... Read More
Open Mic/Band showcase hosted by Barefoot Randy The Emerald of Siam|Richland, WA|Oct. 2, 2017 Full backline of gear inc... Read More
Richland Public Library is pleased to host the Basic Composition: The Key to Better Photos on October 4, 2017. The discussion will ... Read More
The Academy of Children's Theatre is pleased to present Disney's Beauty and the Beast on October 6, 7, 13, and 14, 2017, at 7:00 p.... Read More