One of the common misconceptions about investing in property is that you need lots of money.
It does help, but if you consider how mortgages work, it is often a sensible decision to release equity from your own home at often very cheap interest rates. That’s what I did to get going and the economics are clear – not enough houses are being built, rental demand is so high that the returns on investment, alongside the potential equity growth – give amazing returns.
So understanding that, lenders are keen to support investors through buy-to-let mortgages for up to 75% of purchase price/value, for up to 25 years and some for post retirement age-groups too. Its cheap borrowing for high returns – but it pays to get a basic education before launching into the world of property.
A couple of top tips here:
1 – understand your credit rating through using one of the on-line free providers like Experian, Equifax or Checkmyfile. You will struggle to borrow without a high rating – but you can improve it… for example: by making sure you are on the electoral role; have direct debits set up for unsecured borrowing; pay more than the minimum on credit cards.
2- use an expert mortgage broker who is an investor themselves, who is independent and has access to the whole market. They can find lenders specific to your own personal circumstances – there are plenty out there – some logos below of ones we’ve used. Get a decision in principal before you start looking for the property – then you know how much you can borrow.
Some of the other ways of funding a property purchase include
• Peer to Peer lending
• Rent to Rent / Options
• Investors – Loans and Joint Ventures
These topics are pretty specialised but can really be useful opportunities for flexible funding. I always tell people to use expert advisers, people recommended by others too, its really important to learn with trusted people.
I invested in my education over a 12 month period and have a great success story. I’m sharing my knowledge in a webinar course for beginners. This is a taster of some of the information I covered in my recent 3rd live webinar and alongside real examples, I’m giving people the confidence to get started on their journey to a passive income.