All Mortgage Providers Are Not Created Equal
Ever call an aircraft carrier a boat in front of a Navy man (or woman)
? Ill tell you what - once youve done it once, you wont do it again.
To most people, the words are interchangeable both of them refer to a big thing that floats in the water. And if youre not making your living off the water, the difference doesnt really matter.
But for people who spend six months at a time out at sea, it makes all the difference in the world. A boat is something small that you take out on weekends to catch a few fish and soak up some rays. A ship is a floating city, a place where hundreds of people live and work for months at a time, making money to pay their bills and provide for their families. Just ask a Navy veteran theyll give you an earful.
Whats the point? Words matter. People think they know what words mean, but they dont really know until the meaning of those words becomes really important to their lives. And in real estate investing, nothing is more important than the person who gets you your mortgages.
This person is so important to your business I show you step-by-step how to work with them in the Russ Whitney Millionaire Mastery Training program. This is the only training of its kind in which I work with you side-by-side and show you how to find deals, fund them, fix them up and fill them. More about that in a moment
There are plenty people out there with the word mortgage in their title. And yes, all of them deal in mortgages in one way or another. But that doesnt mean that they are interchangeable when it comes to your real estate investing business.
Mortgage people fall into one of three categories: lenders, bankers and brokers. All of them have their place. But when youre talking about investment properties hopefully, lots of investment properties only a broker will do.
Whys that? I could go on all day, but here are the top four reasons:
Reason #1: Brokers offer more options. Lenders and banks can only set you up with their own products, and most only offer a handful of options. Brokers, on the other hand, represent multiple lenders, so they can offer hundreds of different mortgage programs. This makes it quicker and easier to find the best loan program for your needs.
Reason #2: Brokers are more motivated. Why? Because they work on 100% commission. They need to make the deal happen so they can get paid. That also means that theyll work with you to structure the deal the right way, a big advantage especially when youre getting started. Try doing that with a bank if you dont have every I dotted and every T crossed before you walk in the door, theyll send you home in a New-York minute. Plus, any broker worth his or her salt wants to work with a serious real estate investor its a proven pipeline of future deals. Let your broker know how many properties you plan to buy in the next year and hell be eager to help.
Reason #3: Brokers dont have as many rules. Ok, this landscape is changing as we speak, thanks to all the idiotic deals made over the last decade. But its still true as a general rule that brokers are a better source for unconventional loans. Consider this: even if youre just starting out, its not unreasonable to think that you could have 25 properties and 25 mortgages - in three years. Thats ok, since theyll all be generating positive cash flow. But many lenders and banks wont allow you to carry that many at a time. And because conventional lenders only count 75% of your rental income against a mortgage, that also means youll exceed their allowable debt to income ratio after awhile. Since brokers represent multiple lenders and banks, they can help you spread your mortgages among several different funding sources and help connect you with lenders that understand real estate investing.
Reason #4: Brokers work faster. This ties in with Rule #2 for obvious reasons: brokers dont get paid until the deal closes. The longer a deal takes, the less money they make for their time. Its that simple. Plus, things dont get bogged down in bureaucracy like they do at a bank. For example, many banks require that your down payment money sit in your account for 60 to 90 days before closing what they call seasoning the money. In that time frame, a broker could have closed one deal and started on the next.
This gives you an idea why you need to go with a broker and why he is such a critical part of your power team. But theres a lot more to say here and if you want to be really successful in this business, you need to hear it. Thats especially true today, as the mortgage lending industry is going through so much change. In my 3-day Russ Whitney Millionaire Mastery Training, you can learn the mortgage business straight from an experienced broker and it cant get better than that. To learn more about the next Russ Whitney Millionaire Mastery Training call right now 877-400-7973.
by: Russ Whitney
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