six consecutive years in the reserves or National Guard.
Next, for those with limited incomes who want to live in
rural areas, the Rural Economic and Community Development
Administration offers Farmers Home loans on modest properties.
These aren't for farms, but for homes. Monthly payments are
subsidized according to family income, and interest can be as
low as one percent.
In most states, special programs are available for
first-time buyers or for investors who will help build up
problem neighborhoods, and those sometimes require no down
payment. Again, local brokers should have the information.
Then -- particularly with income property, where the
seller doesn't need to get the money out right away -- you can
always look for a seller who will turn property over to you
and hold the mortgage. And if you look really good, maybe do
it with nothing down.
It's important, though, to remember that when you buy with
nothing down, you're borrowing the full purchase price. Your
monthly payments will be correspondingly high. Those
"successful students" on TV who boast that "by the next
Thursday noon I OWNED a million dollar's worth of real estate"
should really be saying "I OWED ON a million dollar's worth of
real estate."
It isn't enough just to buy property, down payment or no.
The investor could be in trouble pretty quickly if it
proved impossible to find tenants who would pay enough to
cover the monthly expenses -- mortgage principal and interest,
insurance, property taxes, repairs, sometimes utilities. And
if the idea is to turn the property around and sell it
promptly for a big profit -- how come the original owner
couldn't find a buyer to pay that much?
Yes, real estate investment is an interesting project and
can be rewarding. But there are no short-cuts. To succeed
you need a good real estate lawyer, an accountant, and above
all, a broker who will help you.
There are no secrets in real estate investing. Talk with
local brokers until you find one who is interested in helping
you reach your goal.
