New Rental Housing Financing
I am almost finished with college and for the last year was thinking as soon as I graduated I would start building new affordable rent propertys like my friend lives in now. Each house is almost identical and cost about 60k to build and are around 1050sq ft each. I have talked to the people that are the owners and they said its very profitable and most of the time not much problems. So I was very excited and thought I would do the same but I always assumed that they borrowed the money from a bank and had lines of credit or something but yesterday I found out they got started by receiving a large inheritence. Since I dont have wealthy sick family members who are about to die and give me a large sum of money , how can I do what they are doing. Can I still borrow 100% like I thought I would be able too to start?[ Edited by senatorcbp2 on Date 05/14/2004 ]
Welcome to reality*L* A large percentage of the "builders" in my area are so because of family money. In fact some have absolutely no idea of what they are doing, but because they have the cash and a nice big office they land the jobs. As for obtaining financing for what you want to do, it will probably be tough to go about it through conventional means as without building experience the banks will be skeptical at best. Perhaps your area is different though, it's just been my experience here in Michigan that obtaining lending is tough even for the small experienced builder. Hopefully someone here will have some better info for you and good luck
I wanted to start out by building a small home for myself living there for a couple of years and then building a new one and renting out the new one and so on until I can build experience like you said. I did want to start out building them faster but maybe I can buy a apartment complex or something until then. I guess my next goal over the next few months is trying to find other ways to finance. There is always a way even though I may not like it.
Well if you are going to build a home for your personal residence you should be able to get 100% land/construction financing relatively easy. Talk to a local mortgage broker, lumber yard, or something to the effect and they should be able to help you obtain your financing. Good luck.