No Money Down Properties
Lenders have to lend money because this will give them the profit that they like. If you have a good credit score, then you will be given a big chance of having the most of the property since lenders can benefit from the interest that can profit 4% or more of the invested property. But, many lenders would still require you to pay at least 30% down payment on the invested property or money. This is usually the case because the down payment usually covers the costs of foreclosure or subsequent resale of the property concern. That is why there are a lot of people that would like to have a property now even if they are not ready financially and emotionally. These people are usually the people who settle for a no money down property.
People who would like to have a property that would live in. They are newlywed couples or families that move from one country or place to another. They do not have money for a down payment and thus they thought of purchasing the no money down property and end up wasting their money. People who like to have good income without investing a large sum of money would likely end up purchasing the no money down property. But, remember that having a large return of money without even investing in it is an illusion. That does not happen in the real world. These people are just stressed out that they need to have an answer to their problem fast and end up doubling their problems. So, it is important to know what No Money Down property is before engaging in it. Buyers of this kind of property should have their eyes open and know what this is really about.
There are a lot of commercials about buying houses without down payments or what they called “No Money Down. With these, they offer a lot of great testimonials testifying how they got their house and they became rich buying these kinds of rental properties with absolutely no money required from their pocket. But the question is can this really be done? Can you really buy a house with no money down? Can you own a rental house and earn in as little as one month’s time? The answer is YES. The question however you should be asking is not CAN I have this kind of property, but SHOULD I?
You will notice that this kind of questions is not really asked in the infomercials or the person selling you the No Money Down property. And in the testimonials that you read, you do not really see an answer to this kind of question because the answer is kept hidden. If anyone have a chance to ask this kind of question then his market strategy and advertising would collapse and he would be forced to lie in his answers.
The commercials that you saw only give the good side of these kinds of properties. They tell you that you can easily get rich and that you can profit up to $10,000 the very first day you purchase this property. They have limited time in TV ads that they would only give you the bright side and lure you in buying this kind of property. However, that information is normally a paper profit and it can mean that you bought a property that they think is worth $10,000 but with a real value of about $4000. We would then look into the advantages and disadvantages of these kinds of property.
The advantages are little like you do not need to give your own money from your pocket in order to have the property or you can earn money because of your rented property. But, these advantages would not necessarily mean that they would come to you fast. Sometimes, you need to work this out.
The disadvantages however are plenty. There are properties that need to be repaired and the repair itself would cost a lot of money. Sometimes, what you bought would turned out to have a serious problem in asbestos, lead, mold, and other that needs a lot of money before you can rent it. Very few of the people who buy property with no money down became successful over the long-term. In the long run, you will still pay a lot of money in repairing your house or improving it.
People envision that if they can have one property with no money down then why not have ten or fifty? For many reason, they failed to consider that the maintenance of these houses are costly. Also, the possibility of tenants paying late or not paying at all is also a big problem. The most hassle part is forcing to evict them in your property.
There are a number of reasons and ways in which no money down property would be purchased. Just remember its advantages and disadvantages and ask yourself if you really need it. Some of this work sometimes, others work other times, and some doesn’t really work at all. If you want to have the no money down property, you should be open on many circumstances that you would be facing and utilize more than one technique in controlling you property.