First and foremost we want to make sure you have a positive outcome on your transaction. We are keenly interested in the type of property, the value, and the marketability of the property being used as collateral. We will also review your ability to make the payments, your exit strategy, cash reserves, and also your experience level.
Larger cash reserves can overcome lesser credit and lack of steady income but not vise-versa. In a declining market, investors must be familiar with the area in which they plan to invest and understand how to successfully approximate future value of the property as well as home repairs. Not knowing, or understanding this, has been some of the biggest and most common mistakes we've seen over our many years in the business (not to mention costly).
As an example of understanding your market: How much have prices declined? How much of a decline are you factoring into your holding time and purchase price? How much has sold in the area recently? What percentage is pending, sold, expired, and active? Out of the solds, why did they sell? What price will you get when you sell? If you don't know the answers to these questions, we highly suggest doing more homework or do some training to better understand how to arrive at these answers.
