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How To Better Position Yourself for a Real Estate Investment Loan"Each insured state nonmember bank shall adopt and maintain written policies that establish appropriate limits and standards for extensions of credit that are secured by liens on or interests in real estate, or that are made for the purpose of financing permanent improvements to real estate." FDIC Rules and Regulations, article 365.2 Real estate lending standards, paragraph (a). The Federal Deposit Insurance Corporation maintains the stability of the nation's banking system. The guidelines it sets forth are for lending institutions to heed. They definitely have a set of guidelines they follow when considering a real estate investment loan. But, that doesn't mean they can't be flexible when it comes to gaining solid business. As a real estate investor, it doesn't hurt to get on the inside with a few financial institutions so that you can make your deals run more smoothly and gain some multiple streams of income. How You Help Yourself
Gain a Percentage for Being the Loan Originator When you have financial institutions in place, you can easily recommend them to your potential buyers because there is always hesitation. Potential buyers hate rejection and most of them might actually have a legitimate reason to fear being rejected. You can take that fear away when you propose that you can help them obtain a real estate investment loan much easier by going through your financial institution. Do your own screening and know what your lenders expect. Some lenders are fine with high risk loans. Some are not. Take the time to ask a few questions about your prospective buyer's financial situation and match them with the proper lender. Most of the time, because of the volume of business you propose to bring, you'll get a percentage of the loan amount for being the loan originator. That's in addition to the deal you just made on the real estate. The Lender Now Has an Interest in You and Your Prospects When you are bringing them business, they get to know you personally. When you have brought them several successful loan applicants, they are more interested in you than ever before. Lenders love repeat customers and you are handing them business left and right. So when you return for more business, lenders aren't simply looking at you and saying, "Wait your turn." They want to pull up a seat for you and ask you how they can help you today. The table has turned. This takes time in the real estate investment world, but not as much time as you think. If you can bring a lender several successful loan applicants within your first year of business, I would say that you will start getting the red carpet treatment. Plus, your lenders are more willing to work with your high risk applicants. Bad Credit OK Bad credit is not really bad credit in the real estate industry. It might keep you from getting a car or a personal loan for a new computer, but real estate has its own set of rules. The number one premise lenders use to consider real estate investment loans is that a person will fight tooth and nail to make the house payment, even if other bills have to suffer. Even though foreclosures do happen, financial institutions will go to the mat for your business if you hold the promise of bringing them more business. So, Bad Credit is OK! Make sure you have several institutions in your back pocket and know the risks they are prepared to take. Because even though there are risks involved, these are risks plenty of lenders are willing to take to keep your business. When you start bringing lending institutions business, they start to change their rules and regulations. They start to get to know you and give you some red carpet treatment when you walk in the door. That's the kind of power team you are trying to create! Start applying these principles today and begin flipping houses for FREE by starting your 7 Day Trial at INSTANTRealEstateSolutions.com! Brad Wozny |
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