The government insures FHA loans to minimize the lender’s risk
Partnering with someone to invest in real estate allows your resources to be combined, with limited liability for each partner.
If the partnership faces losses, limited partners are liable for only their amount of capital contributions. One partner might have cash to contribute to a project and can allow you to have access to more properties for your portfolio, while the other partner may have better credit, or knowledge of investing in general. Bank financing might also be possible or less expensive once the partners’ resources are pooled.
#6: Federal Housing Administration (FHA) Loans
Because of this, the property that will be purchased must be appraised by an FHA-approved appraiser and meet certain conditions. There are also lower credit score requirements on FHA loans, and you may be able to put as little as 3.5 percent down. This makes these loans a good option for first-time buyers.
The downside is that you will pay more interest in the long run because of the lower down payment. You will also be required to pay an insurance premium upfront as well as annually.
#7: 203K Loans
A 203K loan is a loan that is used for both a home purchase and for home improvement. The loan is guaranteed by the FHA, so lenders are typically more willing to move forward with properties that they might otherwise deem a risky investment. It’s pretty easy to get approved for a 203K loan, but the process will be time-consuming because the FHA and the lender have a lot of paperwork on their ends. (περισσότερα…)