3 Ways You Can Leverage Bank Financing to Build Your Rental Portfolio

Real estate may be one of the biggest investments that you will ever make but once you get started it will quickly accelerate your wealth, open up future growth opportunities, and get you closer to achieving financial freedom!

If you're ready to get in the Real Estate game you’ve come to the right place!

Here are three concepts you’ll want to get familiar with to leverage bank programs to MAXIMIZE your income, scale your rental portfolio and grow your investing potential!

LOW DOWN PAYMENT PROGRAMS ⬇️

Using the DPR Framework (Down Payment Reduction Framework) we will research lenders who offer low down payment programs to buyers. One of the most common yet overlooked resources are lenders who participate in Down Payment Assistance programs! DPA Home Buyers often will see a large discount at the closing table, you just have to do your research and ask your lender if they have DPA options available. I did so and was able to get a $6,000 grant that I otherwise would have paid. This DPA program helped me so much, that I was able to convince my fiancé to go through the same program! He saved $4,500 using my DPR framework!

HOME EQUITY LINE OF CREDIT (HELOC) 💳

H.E.L.O.C, this is the type of loan where a homebuyer accesses the equity of their home while they are still paying off their mortgage.  Think of it as an oversized credit card that you can get from owning a house that has increased in value.

Equity is the value of the property you own (and can tap into!) minus what you still owe on your mortgage. Home values have typically always increased over time but the COVID-19 pandemic has elevated home values more than ever before!  In 2021, the average home owner gained $54,000 in equity. What would you do with an extra $54,000? 🤔

Here is a real life example, I purchased a property that was foreclosed property for $99K, and two years later that house was valued at over $190,000. I was able to get a HELOC for a little over $34,000. That's $34,000 in tax free money I can use on anything! And I can always request an increase later on down the line!

PICK A PROPERTY WITH APPRECIATION POTENTIAL 📈

It goes without saying that most people want to invest in a property that will increase in value, so as an investor you need to be intentional about where you purchase. Do your research of neighborhoods/zip codes and be aware of future market trends and neighborhood hotspots. If you see that many properties in the area are being sold for much higher than the house you are looking at – you might have a hidden gem! As long as you are diligent in having an inspection and leveraging your realtor and investor knowledge could buy a home that is undervalued and will soon be worth those higher prices the nearby homes are going for – thus increasing your potential to get a HELOC, or perhaps a ‘cash out refinance’, or just selling it and getting your money back if you need to! (flip)

RECAP

Looking for neighborhoods with potential or properties that require little maintenance is a great place to start. 

As I said earlier, Real Estate historically appreciates in value, soon your first property will be worth more than you paid for it and you’ll be eligible for a HELOC or Cash out Refinance! 

Once you find solid property with appreciation potential, you will soon have enough money for another down payment for a rental property. and repeat the process This is how you scale to six figures. 

Real Estate is the #1 way to become wealthy in the USA and I’m here to tell you all about it.

REI Platform will be hosting our 5 DAY REAL ESTATE INVESTING CHALLENGE April 25-29 where we will go over the core principles of REI and how you can get started in as little as 30 days!