How Interest Only Funding Affects Cash Flow
How you structure the financing for a real estate deal is important to the long term profitability of that deal.
What you’ll learn
- Different loan types.
- Why investors use interest only loans.
- Why some investors do not use interest only loans.
- What market environments make these types of loans more appealing.
Course Content
- Introduction –> 3 lectures • 8min.
- Why? –> 2 lectures • 9min.
- Why not? – disadvantages –> 2 lectures • 8min.
- Funding Examples –> 2 lectures • 11min.
Requirements
How you structure the financing for a real estate deal is important to the long term profitability of that deal.
Ensuring cashflow is essential to growing your portfolio.
I work with real estate investors across the country and the types of funding products that they utilize have changed as rates have risen. It is important to look into the math on a deal and examine not just the short term but long term profitability of an acquisition. In this course I will go over what the majority of investors I am working with are doing to ensure that they have short term and long term profitability.
We will discuss:
- Interest only Long Term 30 year loans and their interest only periods
- Interest only Bridge Loans and their applications
With an interest-only mortgage, you only pay the interest on the loan. At the end of the term, you’ll still owe the original amount you borrowed. The main advantage of paying a mortgage on an interest-only basis is that your monthly payments will be much cheaper. This allows you to Cash Flow. In real estate investing Cash Flow is the focus.
Interest-only loans are generally for those folks that are probably not going to be in the property for a long period of time such as 5, 7, or 10 years. OR in times when there are high interest rates and your plan is to refinance into a lower rate fixed loan once rates have gone back down.
In this course we will help you better understand the structure of this type of funding and how to make use of it in your portfolio.