Whenever you are looking to make an investment in Real Estate, there are many factors to have into account, and many people may find themselves discourage to take the step once they find out they do not fulfill with every requirement necessary to take up on a loan for a property.
On an ideal scenario, you will need a stable income, good credit score and insurance in order to buy a property and take up on a loan to finance this investment. However, it is quite common that some people don’t have at least one of those pre-requisites. If you are in this position, know that you can still buy a house and there are options to do so, such as getting a partner for the investment you have in mind.
How to select a partner?
In order to buy a property with a partner, there needs to be a balance between the two the parties so you can fulfill the requirements needed to take up a loan. For example, if you don’t have the credit score, you need a partner with a good credit.
What do you need to take into account?
This is a business deal, and as every business, contracts and rules need to be clear. Protect your investment and your business relationship by establishing clauses for the party contributing with money to cover costs or down payments.
How does it work when it comes with the house title?
Even when your partners name is on the loan and yours isn’t, it’s important to have into account that the title will be on the name that you and your partner choose, so rest assure the property will be yours, nevertheless.
What methods are there to invest with a partner?
In order to take up on a loan with a partner, your incomes will be taken jointly, and the loan will be granted to the person with the higher income as the titular.
Scenario A: you have a stable income, for example, $60,000 yearly, but you don’t have a good credit score (at least 600 points). You need to find a partner who has at least similar incomes and a good credit score. Even if your partner has a credit score of 700 points, it will not work since the bank will take into account the person who hast the higher income.
This leads us to scenario B: when you don’t have a good credit score, you need to fix it, and a way to do so it is to have a partner who can add you to his/her credit and wait for at least 2 months so your own can go up.
Scenario C: if you do not have insurance, you need to find a partner who does and also has a good credit score.
Contact me to help you solve these issues and lead you to the right way so you can make your investment and start making money.