Is YOUR Bank Open?
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On Sunday, I watched my annual Football game. Now, I am more of a Baseball gal, but this game got me thinking about teams. One of the announcers commented that he felt there was nothing like football because there were two teams of 50 players, each needing to understand their small role in the game that, when added together, could lead to great success for the whole group.
And Real Estate Investing is all the same!
I received a ton of great feedback from last week's Lady Landlords Podcast episode with my financial advisor, Frank Schursky, as he walked us through how to find the right people to work with as well as strategies that every Real Estate Investor needs to know about.
But, a Financial Advisor is just one piece of the puzzle!
Now, I might not know the positions for a football team, but I do know that every team needs a Quarterback. On my successful Investing Team, I have my trusted Realtor, Lenders, Home Inspector, Accountant, and the list goes on, but today, let's focus on that Quarterback (That would be YOU!) The Quarterback needs to not only be able to lead her teammates, but has to know all the plays involved that the team can use.
So, let's run the ball ourselves!
Sometimes in Real Estate Investing, instead of looking outward to who can provide certain options to us, we need to look inward to what we already have and what we can monopolize on.
Here are 3 Ways to open YOUR Bank:
1. Use your Assets.
Often, when looking for our next deal a question that inevitably pops up is "where am I going to get funding for this?" but here is a great place to change our mindset to "where do I already have the funding for this?" Think of the assets you currently have that you can utilize. Do you have a primary home that you can leverage? Home Equity Lines of Credit (HELOCs) are a great way to pull equity out of a property you live in to put towards another cash flowing property. Also, if you have thinking about refinancing any of your properties before interest rates climb again, consider pulling cash out at the same time! Two great ways to use what you already got!
2. Get Creative.
When we think about using ourselves as our own bank, consider where you already have funds built that you can borrow against. In the finance world, Whole Life Policies tend to get a bad rap, but can be very useful for Real Estate Investing depending on the cash value of your policy. Investing using a self-directed 401k allows you the same power to lend yourself your own cash. What could be better than that?
3. Find other "Banks."
If we each can function as our own bank, consider what other "banks" you might have exclusive use of. Here is where speaking with friends, family, and partners about being your private lender can prove beneficial to both parties. Not everyone has the risk tolerance like you to be a landlord, but there are plenty of people willing to put their faith...and their money...into you to be one. Identify those people and use their "bank" to kick start yours!
Hope this gets your mindset into seeing Financing in a different way!