Please help I want to invest in apartment buildings and become the owner how do I do this?

Question

I understand it is expensive yet Their is no doubt in my mind this is the least riskiest form on investing. I have read about loans that can cover 80% how much money do I need to do this or how can i cover the funding with 100% loans? I want to do this and do not want to start now I'm pretty much broke but is that really an issue? Where can I go what can I do finding these 20-30 unit property will be a challenge but the funding is the real issue I'm willing to commit anyone got any ideas?

Answer 1

In my opinion apartment buildings are one of the best real estate ventures because you have all of your tenants on one property.  It is possible to buy an apartment building with no money down.  The banks won't loan you the money to do it but one common method is to find an apartment building owner who is ready to retire or can't manage the property anymore.  You then need to have that property owner sell you the property with owner financing.  There are many more methods you can use to acquire apartment building properties. Get an education first.  Read a lot of good books about the subject and join a real estate investors club.  Here is a great resource online that has a free mini apartment building course that you can take:

http://www.ApartmentBuildingInvestor.com...

Answer 2

If you are broke that will be a huge problem.   The banks and lending institutions want to see that you have some collateral incase you end up being unable to make the payments on your loan.  If you are broke, you best have some other assets; a house, car, stocks, bonds, land, etc.

With the credit and housing crisis' the way they are, lenders will want a larger % down for the down payment that was typical 3 years ago.  I looked into getting a small condo as a rental property, and was expected to put down 15%, a large increase over 5% (or even 3%) from 2004.  

Good credit is also going to be esential.

You need to get some money to your name.  You need to develope good credit if you have not already done so.  You need to show that you have a steady income and means of making the payments.  You also need to show good character and reliability.  Banks will not want to lend $1,000,000+ to someone who cannot spell or punctuate correctly, and who has no money.

Answer 3

Usually you really only find venture capitalist, but you get the job of managing the property. You need a business background and to form a corporation. A venture capitalist is a person or investment firm that makes venture investments, and these venture capitalists are expected to bring managerial and technical expertise as well as capital to their investments or your business background and corporation. Venture capital is most attractive for new companies with limited operating history that are too small to raise capital in the public markets and are too immature to secure a bank loan or complete a debt offering.

A 20-30 unit property would cost you 20% of a few million dollars and if you have that much you can apply for a mortgage. You might need to start small and acquire several properties first. Prove your business and work upward to a 20-30 unit property landlord.

Answer 4

Even if you could find a loan with less than 20% down on a large building, how can your cover the expenses of vacant apartments, renovating between tenants, dealing with late payers or non-payers, evicting deadbeats, paying the taxes when due, and probably hire a property manager? You will have to show the lender how much experience you have had in a landlord/tenant situation, and keeping accurate books on the property.

Answer 5

An important question to answer before seeking an apartment loan source is the approximate cost of the property. This may seem like a no-brainer when looking for an apartment loan, but too many first-time investors just take the interest rates they’re given without question. If the apartment building you’re interested in is selling for over $500,000, a direct lending source or investment company can usually give you a better interest rate than most banks or credit unions. However, if you’re looking at a smaller apartment building selling for less than $500,000, you may want to check interest rates at the local bank.

http://badcreditloans.awardspace.com/

Like the name suggests, an ARM is a loan will an interest rate that may change with time in accordance with various factors. ARM apartment loans usually offer a better initial interest rate than other loans to offset the risk of future interest rate changes. An interest rate ceiling that may be reset annually also protects the mortgage holder. If you plan to stay in the property management business for the long-term, you may want to look at getting a fixed rate apartment loan. A fixed rate loan guarantees the same interest rate over the life of the mortgage.

Answer 6

You are trying to start too far up the ladder.  First you will need to save some money.  The best way to start out is to buy a property that needs intensive management to make it profitable and desirable.  You will need to live on the property and ride herd on your tenants.   By painting and fixing and moving in responsible people, you can build a good equity in about two years and then use that equity to buy a larger property.