Do you have a 9-5 job? Many people believe that real estate requires 40 hours a week like their current employment. Some investors work 40 hours a week on there real estate business while others work 40 hours a year. Real estate investing does not have to be a full time job. Real estate can be a passive business depending on your team, strategy and systems. There are two main benefits of having a 9-5 job as a new investor.
Financing
Most banks and credit unions require a source of employment during the qualification process of a loan. Financial institutions must trust that you are fully capable of paying the monthly mortgage. The loan amount a bank will provide generally is 3-4 times the annual income earned from an employment.
There are four main finances every financial institution requires including credit, two year work history, down payment and a low debt to income ratio. Banks and credit unions limit their risk of lending money to people who are liabilities through their high qualification standards.
Multiple Income Streams
The second major benefit of having a 9-5 job is the ability to live off of your employer rather than your rental cash flow. Your 9-5 job is the steady income coming in every month from your employer. Most investors with full time jobs live off of their 9-5 income.
The cash flow from your investment property can be reinvested into your next rental property. Having a 9-5 job can also cover unexpected fees and expenses that may come up during renovations and repairs. Keep your 9-5 job until your monthly cash flow from your real estate business provides more monthly income than your 9-5 job. This strategy is a “safe” way to invest in real estate with limited risk of failure or loss of money.
Talking Real Estate Investing in Single Family Homes! 