Home Equity Loan Creative Real
Estate Financing
Technique #7...
Home
equity loan, a good source for capital to help a new investor begin can be found in the investor's own
home or investment property. Many lending institutions make loans secured by the equity in your home or other properties, usually for about 75% of their value. If you look for special offers, you can get as much as 80% to 85%. The interest rate is usually tied to the prime rate: for
example, prime rate plus 1% or 2%.
The payoff period, or time in which the investor is required to repay the loan, is 5 to
15 years, depending upon the lending institution. Most institutions do not charge any points (the percentage of the loan that the borrower must pay to the bank) for making the loan. In addition, the origination costs of the loan are very small.
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Specific
Situations to
Apply
Technique #7
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Home
equity loan
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The
Property
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The
Buyer
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No
Cash at All
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Equity
in Real or
Personal
Property
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Dead
Equity
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The
Seller
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Needs
All Cash for
Equity
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Home
Equity Loan to
Private Mortgage
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