liketofishi asked:
Anyone have a good example of a business plan related to rental property investing that has helped secure financing.
Gina
Anyone have a good example of a business plan related to rental property investing that has helped secure financing.
Gina
{ 3 comments }
Ttry to post your question in the real estae catagory you probably would get more anweres on this subject< good question though! Because when someone answeres it im ready to take notes because im seeking the same answere, peace.
Ok here is the plan you need a statement showing what the real estate will generate in monthly income. an expense statement of what the taxes and management expenses will be. The amount of the monthly rent needs to be at least 1.2 times the pmt to make it make any sense to a lender or financier.
The lender should have an entry plan and an exit plan like for example i plan to rent for 7 years then slap some new siding on it and sell it after year 7 as a flip. thats entry and exit.
Or I plan to buy it and rent it and pay it off and give it to my kids when I die.
The additional needed to secure financing would be as follows you need the income you make to show lender you can make a pmt if it is vacant for a month. This means your pay stubs for a couple months and proof of employment for one year. You will need 2 years of tax returns
You can also make a list off your assets and liabilities.
We call this list a financial statement or a executive summary.
This is for example u might list the car pmt of 300 a month and have debt owed of 5k on a car worth 10k.
Its a 10k asset with a 5k liability attached to car. You will have to show all debts owed cause lender will find out any ways when he pulls credit on you. Or you could list a stock u own worth 5k as an asset. Or 5k in checking as an asset.
Which leads to the next thing why not have a copy of credit score to help lender get your pre qualification faster!
This information will help you get the loan to get a rental property. Being prepared makes lender think you are serious about your investment future. Organized and well dressed like you mean business.
Have the down pmt or some money saved as reserves in case something breaks lenders want to see some cash on hand to cover unexpected repairs or emergencies. I would say have at least 3 to 6 months payments on hand and the down pmt in cash. Also keep personal debts low this will help debt ratio to income ration to make the loan!
Well I hope this helps you. Look up executive summary in the library and make one up on yourself! Its a resume for a banker from an investor
John T Reed’s books help you with that sort of thing: