Is There Down Payment Assistance for Real Estate Investing?
It’s late, you’re watching my youtube channel, you’re fantasizing about real estate, and you’re thinking, I wonder if there’s down payment assistance programs when right on the TV you hear this jingle, down payment assistance could be so awesome! Well guess what? today we’re talking about downpayment assistance. Does it really exist? Can you use it in the world of real estate? find out. Down payment assistance. You know we live in a world right now where there’s so many banks that are competing for you. And you know what they’re gonna want some basic things. They’re gonna want you to have some good credit. They’re gonna want you to have a two-year steady work history but if you do, they’re gonna start bringing all sorts of options to the table and I want to talk to you a little bit about downpayment assistance. First of all, putting a down payment to buy something is really cool the bank’s willing to put up the rest of the money and take a risk on you and I so that we can create wealth and real estate. Create a heritage, create a legacy for the next generation. That’s what I’m doing in real estate and that’s what you can do too. And so it’s awesome that banks are out there to help us out. So first of all, it’s important to understand that your state and our government on a federal level they have down payment assistance programs and that comes from that very public sector but from the private sector in the banking world, we also have banks and then I want to show you one of my real cute tricks here on 401ks that most people don’t know about. First of all, governments more or less mandate a number of different programs for first-time homebuyers. They’re not really interested in helping investors but they’re super interested in helping people that are buying a home for the first time. And remember, it doesn’t mean that your own home you buy can’t be an investment. Your own home can. I think it should be an investment. You know if this is one of the biggest mistakes that young people make these days. It’s time to buy a house and they’re so sick and tired of having it worked at McDonald’s they now have their valuable piece of paper it’s hanging on my wall that says I’ve got a degree. I’m smart. So now it means that I can get hired and oh my gosh I got paid forty thousand this year. You know, which is the national average or fifty or I’m making seventy thousand dollars a year. And what’s the first thing we do? We get picky and say no more four hundred square foot hole in the dumpy-dumpy ground apartments. I’m gonna buy myself a house. And what do we often buy? We buy the nicest house that we can afford. And it feels great until you realize that you just put a ball and chain on your hip with the 30-year mortgage maybe a forty or mortgage something you’re going to refinance 20 years later. You may never get the sucker paid off and you are in bondage to it. So when you buy a house using these programs, use them to your benefit. Buy a house with equity. You don’t know what that means? Watch one of my videos on equity so that you can know it’s one of the most important parts of being a real estate investor. You can get yourself a nice house but if you balance it with having equity, guess what that means for you? it means that you’ve got more options for your future. If I bought a house, for example this house has a value of a hundred and fifty thousand dollars and I purchase it for a hundred and twenty thousand. Well guess what? maybe it was a little shabby er than something totally new that I could have gotten and maybe I put a little sweat equity into it did a little paint job or whatever. But guess what? that thirty thousand dollars means? Freedom. You lose your job six months later you’re struggling to afford the mortgage. Oh no you got to move out. Guess what you can do? This equity now means you’ve got cash flow and when you rent it out or sell it and what if you made twenty thousand dollars after your costs? twenty thousand dollars guess what that does when you lose your job? All of a sudden, you’ve got even more money. So be smart when you buy your homes. State government, banks, 401 case. First of all governments and banks, they’re really good at making sure that there are three to five percent down payment programs. Governments have programs where it can even be 0% if you qualify. Banks will always be at three to five percent and then the state that you live in. If you just Google, you know, downpayment assistant programs for Vermont, Utah, Texas. What you’re gonna find is that your state, they often offer incentives to help out. Why? because first of all they’re often getting federal funding or number two there might be areas or counties that they want to grow or expand. You know, I live here in Utah and at the point of the mountain which is this new metropolis that’s booming, the the state of Utah has has given out all of these business incentives so that now people like Adobe and Google are coming and moving here in large corporations because the states make more revenue and they can expand and build them right? So they have more more revenue for their projects. So you should check out what your state is local is providing and your banks that you to, your loan officers, your lenders, they’re gonna be aware of the government programs that they can often help you out with. And then here’s my little tip and trick of the day. A lot of you are putting money in a 401k. We’re not going to talk about how much that is upsetting to me that you’re locking up your money and largely untouchable and that I think that it is a very financially unwise decision. Even with the match I want my money today so it can work for me when? Not in 30 years from now because my money is more valuable today. Let go of the match but let’s just say you have one of these 401ks. It’s hard to get your money out, you got to prove hardship often or you got to leave your job. But 401ks have an exemption that say you can use up to ten thousand dollars when purchasing a property. A lot of people don’t know that so if you got twenty thousand dollars in your 401k, talk to your HR director and ask them hey I’m buying a house and in this case what is a three percent down payment on a hundred and twenty plus thirty six hundred dollars. Let’s say that you have to pay some closing costs out, let’s say that out-of-pocket it’s gonna be five grand, guess what? Your 401k that you’ve been putting money in just helped you actually buy that house and fund your down payment. That’s the cool little caveat it gives them a little bit of redeeming value not much. Put it together gives them a little bit. So friends, that’s our video today on downpayment assistance. Check with your local state, check with your bank, and if you got a 401k, boom! You got a great solution there! If you’ve had success in the world of getting downpayment assistance and other programs or local community programs, share in your comments below. I think it’s gonna be super inspiring for all of us to have a chance to see your experience out there in the game of real estate. Otherwise subscribe, we look forward to your next video.