One of the most talked about real estate investing concepts is investing without putting your money or credit on the line. It can be and is often done. It doesn’t mean that you don’t need money. What it means is you need access to other people’s money.
Creative financing has long been a main stay in the toolbox of real estate investors. The following is not a comprehensive list of ways to invest in real estate using other people’s money but it does represent the most used methods.
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- Seller financing. Instead of collecting all cash at closing, the title is transferred to the buyer and a mortgage or deed of trust is recorded against the property along with a promissory note defining the terms and loan amount the buyer owes to the seller.
- Subject to existing financing. This technique is used when the seller still owes money on a mortgage. It requires the buyer to continue making the sellers mortgage payments as well as a second payment to the seller (his or her profit).
- Using private money is becoming popular in today’s bank loan restricted economy. This money can come from many different sources. Wealthy individuals looking for …read more