If you’ve been thinking about investing in real estate, here’s what you need to do before heading out to shop for properties.

 

  1. Create a financing plan

  • What’s your current income?

  • How much do you have in savings?

  • Can you get a mortgage loan?

  • Will you pay in cash?


   2. Keep your credit healthy

  • Request a copy of your credit report.

  • Dispute any errors.

  • Pay all your bills on time.

  • Pay down high-interest debt first.

  • Be strategic about opening or canceling lines of credit.

 

    3.Get pre-approved for a mortgage

  • You’ll need the following in order:

    • Personal documents

    • Tax returns

    • Proof of income

    • Proof of assets

    • Summary of debt


      4. Do your homework

    • Compare different mortgages from different lenders.

      • What interest rates are they offering?

      • How much will they lend you?

    • Check in with your current bank and others, too.

     

     

          5.Establish liquid funds

    • You’re going to need some cash on hand to buy, if only for a down payment and closing costs.

    • Don’t forget about renovations and repairs.

    • If you’re flipping a house, you’ll need to consider your monthly cash flow.

      • Secure a backup source of cash.