Financing and Credit

Which is better and why? I know it would be based on the person's situation but which one should I take out if I wish to take out the equity from my property with the lower interest rate?

Thanks!

An interest rate buy down is where you pay money up front (usually at closing) to get a better interest rate. There are a couple of things to consider when doing an interest rate buy down. First if you do not plan on keeping the property or plan on refinancing it in a couple of years the buy down will probably not be worth the cost. With interest rates very low at the moment it would be a great time to do a buy down, because you will get a lower rate than the market is giving and the rates will most likely not drop low enough to temp you into a refi.

Anyone ever use National Angel Investor Lending Forum (NAILF). I recently posted a request on www.gobignetwork.com/funding seeking for private money to do my deals. I got a call a few days later from NAILF, and they said I would need to pay $250 to set up a phone interview with some of the company's investors, who would review my business proposition, and then decide whether to provide me funding or not. I'm wondering if anybody's ever used such "angel investors" in the past, and if so, any success stories. I've looked on the web, and there's not much.

Don't forget to consider owner financing the down payment. If you have a lender who has approved an 80% loan for you but you're wondering how to come up with the 20% down payment and the money for the other costs and rehab, consider asking the seller to provide the down payment. You would sign a note back to the seller for the amount of the down payment. The seller could protect themselves by taking as second mortgage on the property for that amount.

The seller gets most of their money at closing and is earning interest on the down payment money. It helps the seller and buyer.

This is for those needing proof of funds and wondering where to get them. I needed a proof of funds letter this week to go with a short sale offer. My loan officer said things are tighter now and did not want to offer a letter until a loan had been approved. I said "I just need it to go with an offer. Can you write it according to what we have in our Roth IRA?" She said no because they can't use IRA funds as a guarantee for a loan. Well, I thought "baloney", because I know that you can have access to your Roth contributions without penalty, just not the growth.

How do I run someones credit?

There are several new ideas out there that are being utilitzed taking lead from a down market. It turns out, these creative home-buying techniques aren't particularly new. In fact, homeowners and lenders are just taking cues from past economic downturns. Here are some ideas from Forbes.com. "Many of the new mortgage products that are surfacing are retreads," says Anthony Sanders, professor of real estate finance at Arizona State University. "[They're] variations of mortgages that were popular during the high-inflation, high-interest-rate period of the late 1970s and early 1980s."

This is probably the most common question. The answer is yes. You may not be able to get conventional financing but there are options to do properties without financing. Even more opportunistic is that you can use options such as contract assignments and instant equity exchange (in Dean's new book - look for it). There are plenty of options to for that that are starting. Keep this in mind.

Here is an article that explains the $7,500 tax credit offered to new home buyers.

NEW YORK (CNNMoney.com) -- If you're thinking of buying a home, there could be a big bonus for you in the economic stimulus bill that's now before Congress.

Among its many provisions is a $7,500 tax credit for first time home buyers. The House passed the $819 billion stimulus plan, including this tax credit, in a vote late Wednesday. The Senate may vote on its version of the bill some time next week.

My first post...Ive been here about 2 months now and can relate to a few people. I myself have taken the route of a joint venture with another investor, because my credit is not up to par. So last week I started looking for ways to establish credit. A lot of people in the same boat decides to established LLCs. Which is what I looked into. During my search I got a call from one of Dean's Partners that help you setup a business. Which they inform me to get an LLC. There were a couple programs and they cost about a couple hundred dollars to setup plus state fees.