If you’ve got a good start on self-directed retirement funds, but not quite enough to purchase a rental property outright, how can you get started? That’s our first question for this Q&A Monday! On today’s show, I’m taking three listener questions on various real estate topics.
First, we’ll talk about using your retirement funds to invest when you don’t have enough to buy an entire investment. I’m also answering questions on financing options for young and inexperienced investors, plus how to determine if the HELOC method is a fit for you. Tune into this episode of Investing in Real Estate to hear my answers!
On this episode you’ll learn:
- How to start investing with $40,000 in self-directed funds.
- Financing options for young investors.
- How to determine if you should utilize the HELOC method with a low mortgage interest rate.
How to Start Investing with $40,000 in Self-Directed Funds
If you want to invest in real estate with self-directed funds, but you don’t have enough in your account to buy a property outright, you can still get started! At our company, down payments are in the $30,000 to $40,000 range. You can book a call with our team to learn more about investing with your self-directed IRA. If you’d like to go another route, you can seek additional financing with a company like Fund&Grow.
Financing Options for Young Investors
Inexperienced investors with little to no credit history can look into funding options like non-recourse financing. Another idea is to have a parent cosign on a loan. Additional options include business credit and working with partners. Here is a post on nine ways to fund your next investment.
How to Determine If You Should Utilize the HELOC Method with a Low Mortgage Interest Rate
Homeowners with a low interest rate on their mortgage might wonder if it’s still possible to pay off their mortgage with a HELOC, as suggested in our book, How to Pay Off Your Mortgage in 5 Years. It’s important to note that your two biggest enemies in your mortgage are time and interest. If you can reduce the amount of time you spend paying into your mortgage, it may be worth it to utilize this strategy, even if you’ve got a low rate. The only way to know for sure is to run the numbers. We’ve put together a free spreadsheet you can use to input your mortgage info!
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DISCLAIMER: I am not a financial adviser. I only express my opinion based on my experience. Your experience may be different. These videos are for educational and inspirational purposes only. Investing of any kind involves risk. While it is possible to minimize risk, your investments are solely your responsibility. It is imperative that you conduct your own research. There is no guarantee of gains or losses on investments.
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Your links to get the spreadsheet do not work.
Hi Dave, are you referring to the HELOC spreadsheet? It’s working on our end. Can you either try again or possibly on a different browser?