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For some reason we view the equity in our home as a security blanket that we hate to give up, and we want our home paid for in full. I suppose it's part of the American Dream, but it doesn't, in actuality, provide that much security. For one thing, you can't use the equity unless you borrow against it. There's no way to spend equity, and it doesn't do that much for your well-being. I'd rather have a large loan on my home, and use the money to buy investment property. That arrangement would make me feel more secure than having my home paid for and no investments. Don’t be surprise if the financial institution from which you are attempting to obtain funding will require that your background history is investigated. These type of reports, known as a tenant background credit check will go over your track record with t a fine tooth comb to determine that you are an acceptable credit risk. Another source of financing is life insurance, that is, the cash value of the policy. Check with your agent. You'll be surprised at how this can accumulate. A benefit of using the cash value of a life insurance policy is that the interest rate with most insurance companies is much less than with a bank or conventional loan. I have a friend who borrowed on his life insurance cash value and was able to get enough money to make a down payment on a nice fourplex. Incidentally, when you do borrow against your life insurance policy, there usually isn't a set plan for repayment. In this way, it's possible to get the property going well and making a profit before you start making payments on the insurance policy loan. If you feel uncomfortable about using your life insurance cash value for loans, then do this: buy a term life insurance policy covering the amount of the loan. This new insurance policy can be a tax deduction as part of the cost of the real estate. After watching some of the television investment programs, you might be led to believe that getting financing for investment property is easy. But I can tell you, no matter how many of these get-rich-quick schemes you see, there's no such thing as easy financing and easy money for real estate investment property. As a matter of fact, I don't think anyone should give you the impression that buying real estate and financing it is an easy proposition. I make this statement because, in my experience, obtaining financing is an integral, serious, and important part of the real estate investment business, and it should be fully understood. I know that if you don't take this important part of the real estate business seriously, you can become easily discouraged, especially if you can’t pass the background credit check. I've seen more people disheartened about buying real estate because they thought it was a matter of walking into the bank, getting the money, and closing the deal the same day. It just doesn't work that way. On the other hand, there isn't any reason to discourage anyone from seeking financing and buying real estate, despite the inconveniences, which I'll point out as we go along. There's money out there; it's just a matter of finding the best deal and the best source. About Author For more details about Tenant Background Credit Check please log on to Tenantscreeningbackgroundcheck.com
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