FUNDING FOR RENTAL PROPERTY INVESTMENTS
Our ultimate goal at Home Invest is to help you retire and live off your passive income from real estate rentals. Every new investor starts by connecting with one of our Home Invest Advisors to develop a personalized investing strategy. An important part of getting started is knowing what funding options will best match your investing strategy.
There are several funding options we encourage investors to use with Home Invest. In certain cases we may be restricted by what funding options are allowed, but we start by understanding your unique financial position.
As the name implies, this funding is solely made up of cash. It’s the easiest and most secure investment option. It puts you in the driver’s seat of negotiations. Many sellers will give cash-only buyers a preferred status when considering offers. All Cash means you also have no mortgage to worry about and peace of mind that your property has little to no overhead from Day One.
A 1031 Exchange allows you as a real estate investor to defer capital gain taxes from the sale of a property. You as the investor can safely protect your sale proceeds by investing in new properties instead of paying capital gains taxes. Our Advisors can pair you with a 1031 Exchange expert if you need any help with this process.
If you’re a self-employed business owner, you may be eligible to fund your rental property investments through your Solo 401k. We recommend connecting with your Home Invest Advisor to learn more about leverage your Solo 401k for real estate investing.
Self-Directed IRA (SDIRA)
Diversifying your IRA funds is an excellent way to protect against market loss over time. Real estate is one of the rare investments in this life that consistently increases in value. A self-directed IRA, or SDIRA as it’s often referred to by investors, allows you to choose where to invest your IRA funds into the future. By using your IRA funds to purchase rental properties, you can receive tenant returns as well as market appreciation over time. It also means you can purchase, sell, and even exchange your properties from your portfolio without significant tax implications. Using a self-directed IRA to purchase rental properties can open up a new world of financial freedom. It can free you from watching the stock market as you consider retirement.
Traditional bank financing is another option we recommend to some investors. As with purchasing your primary residence, traditional bank financing comes with the same type of process including inspections, appraisals, paperwork, and closing details. The good news is Home Invest can take care of the entire process for you. We work with your banking institution to ensure your property purchase is as smooth and trouble-free as possible.
There are occasions where an investor is in a position to secure private financing for purchasing rental properties. We work with you as the investor and the other private party as the financier to verify the appropriate funding is in place. Any questions and concerns you or your financier may have are welcome to be expressed throughout the process. Your Home Invest Advisor can walk you through each step of the transaction. Our goal is to help you and your financier are receiving the returns you expect moving forward.