In my quest to invest in real estate again I’ve had little luck finding a property that felt right.
Until now, that is. (Pictures to come.)
Since I’ve found a property and have been working on this goal I’ve received several questions. The most common being how will I get an investment property loan since I’m self-employed and how will I save enough money for a down payment?
Today I’ve got some answers for you.
Getting an Investment Property Loan While Self Employed
I’m sure you’re aware of the fact that it’s hard to get a rental property loan when you have a full time job and it’s even harder when you’re self-employed.
There’s no way a bank would lend me money right now. (And if they did they’ve got some serious problems.)
I needed a partner. And luckily for me I had one who was more than willing and also has an excellent credit score. (My boyfriend, Jamie.)
So, you’re probably wondering if I think it’s a bad idea to partner with a man than I’m not married to. No, it’s not.
I’ve been with Jamie for more than a year and this is the absolute healthiest relationship I’ve ever been in. He’s more than willing to get married whenever I’m ready.
But we’ll cross that path another day.
How I’m Saving Up the Money
According to my calculations I’m going need to somewhere around $10 – $15k for a down payment, closing costs, insurance, and repairs.
Since the house I’m interested in just went through the foreclosure process it’s probably going to be at least six months to a year before it’s on the market.
In this instance I’ll need to save somewhere in the range of $1,700 – $2,500 per month to be on the safe side.
And with some smart money habits, more work, and laser like focus I think I can do it.
I started saving last week and here’s where I’m at:
- 6/24/14 Blog Income (my personal blog) $364.28
- 6/24/14 Cash Balance from Investment Account $25.69
- 6/26/14 Blog Advertising (my personal blog) $115.00
- 7/1/14 J. Bill Over Payment $50.08
Total Investment Property Savings = $555.05
I plan to put everything I earn in excess of $2,000 into this account. Jamie will be adding also so we’re keeping track of all the sources of income for extra motivation!
But What If…..
There are all kinds of what ifs in this scenario.
What if the property hits the market before I have the cash? What if the banks waits a couple of years before selling the home? What if I’m way off on the price of the house?
My answer: it’s okay.
The recent foreclosure I found has sparked some much needed motivation in the financial department. If I don’t end up getting this particular home I’ll still have plenty of money saved and will be ready to pounce on the next best place!
Even if I don’t get the house I’ll still be in a far better financial situation if I keep saving!
What financial goals are you currently working on?