Equity Matters: Financial Strategies for Real Estate Investors (Part 2)

Judy Meredith
“The Mortgage Professor”
Hawaii Area Manager
Direct: (808) 222-7903
NMLS ID: 716323

Real Estate investment can be a quick paced game and things are always changing.

Governor Ige issued the latest executive order on Tuesday, August 10th; calling for further limitations to social gatherings, restaurants, bars, professional events, and restrictions on indoor capacity. Due to the 4th wave of Covid 19 and Delta variant outbreak, Hawaii’s Covid Reopening Strategy is rolling backwards.

It goes without saying that COVID-19 has had an unprecedented and far-reaching effect on the American economy. With record unemployment and job uncertainty being a reality for many, it can be tough to find the silver lining. However, it’s important to remember that in times of fear and uncertainty, there is also opportunity. For many real estate investors this new information can be a game maker or a game changer.

So the question is: How can a real estate investor leverage change and profit in any real estate market?

Successful investors are flexible. They understand that to succeed they must be prepared to take advantage of the opportunities that come their way. And this could be during an upswing, a down real estate market, or an inflection point. Whether you’re just getting started or you’re a seasoned veteran, there are ways to make money during every phase of the real estate cycle. But to do so, it is paramount to have a strategy to handle changing market conditions.

1. Don’t Fear Change, Embrace It

As stated in a famous quote from George Bernard Shaw in 1944, “Progress is not Possible Without Change”. Change is inevitable. And you can respond to it in one of two ways:

a. You can embrace it, modify your investment strategy around it, and reap the benefits from the opportunities that present themselves.

b. Or you can fear it, refuse to adapt, miss out on the opportunities that come your way, watch your profits shrink, and potentially lose money.

2. Leverage Asset Based Lending for Real Estate Investors

At this moment, over a year and a half into the pandemic, there is a possibility for making money on equity as well as capitalizing on the current low interest rates and financing terms. House prices are holding steady and financing costs are low, which is an almost unheard-of situation. The way I see it, this is a gift from the Heavens.

Mortgage interest rates are at their lowest in over 87+ years and the more forward-thinking Lenders are developing new mortgage loan options for investors to stay in the investing game. Built specifically for real estate investors, an asset-based mortgage is a popular solution for investors who want to qualify without income verification. Asset based loans consider your assets instead of relying on your income. As such, they do not require a tax return or proof of income to purchase a home. Since many of these creative financing options are available in 30 year terms, real estate investors can have a reduced documentation experience without having to sacrifice for higher interest rates and shortterm loans , such as a bridge loan or hard money loan.

a. Investor No Ratio – these are loans that are qualified based on the property type and the cashflow your investment is producing; thus there are no traditional debt to income calculation to adhere to.

b. Investor Stated Income – these are loans that qualify based on the Buyers income profile as it is described by the Buyer. There is no income documentation and the stated income is supported by asset statements to align with what is disclosed.

c. Investor Bank Statement program – these are loans that qualify based on business banking deposits tracked thru bank statements, in lieu of traditional tax returns.

The key to navigating the changing mortgage climate is to be sure to align yourself with a knowledgeable mortgage expert that can lead you to financial success. At PRMG, our motto for 2021 is No Homeowner Left Behind, because we pride ourselves in offering traditional as well as creative financing options for those who may find themselves “outside the box”.

We have a dedicated team of Mortgage Experts to help you and we offer free consultations! Visit https://oahu494.prmgapp. com/HonoluluTeam.html today to book your appt with one of our Specialists!

Questions for Judy Meredith? “The Mortgage Professor”

Email me: I welcome the opportunity to help You find solutions! jmeredith@prmg.net

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