Do you want to be a real estate investor? But bad credit and no money in savings seem to be a major drawback? The good news is it’s only a drawback but does not make it impossible. Read on to find out various ways to overcome this drawback.
Look for hard money loans
Hard money loans are easy to get, flexible, and quick to process. Unlike bank loans, they don’t undergo a standardized underwriting process, and they finance the purchase and renovation of a property.
Use home equity line of credit
Home equity loans are principally used to fund long-term real estate investments. The good thing about a home equity line of credit is that it will be tied to your property and stays off your credit record.
In this case, the seller, who is the lender, funds the property for you, and a formal agreement is reached on how you will be able to repay.
Engage in wholesaling
This requires all real estate expertise. You simply find a buyer for a property still under contract and sell it at a higher amount.
Having a partner with a good credit score can make securing funds for the property easier. I advise you both to register the business and reach a formal agreement to be on the safe side.
House hack your primary residence
If you own a big home, you should consider renting out other units like unused rooms, attics, etc. this is the best way to raise money without risks and interest.
Seek private money lenders
Private money lenders are more concerned with the profit of your deal and can overlook your credit score. This also means that interest and other terms are negotiable.
With the options above, nothing can stop you from realizing your dream.