Posted by BillW on July 11, 2001 at 22:40:58:
Lucy, I’m not an expert on financing, but I believe the banks mostly look to your job and cash flow as the primary source of money for the repayment of their loans to you. If you quit, it may change their willingness to lend to you. I recommend you go to the financing section of this site and ask the experts there. Just don’t up and quit yet till you get some concrete answers from people making loans everyday.
BillW.
Financing with No Income - Posted by Lucy
Posted by Lucy on July 11, 2001 at 19:50:29:
Hi,
I’m considering quitting my job but I’m
questioning this move because I’d no longer
have the very sweet bank financing that I
currently get due to my salary and work history.
This financing has allowed me to do a couple of
RE deals with awesome profit margins (I’m
a newbie and this is my first year investing
in RE but I lucked out and profited ~400K
in 2 deals this year).
My question is, are there good financing
options out there for people with excellent
credit (last I checked I had the “premier
rating”), a lot of cash in the bank, but no
income? (Why get the financing with a lot of
cash in the bank? - to use other people’s
money for the RE deals and my own money for
other investments). Ideally I’d like the
financing to last 2-3 years.
Thanks!
Lucy
Re: Financing with No Income - Posted by Lucy
Posted by Lucy on July 16, 2001 at 02:08:31:
Thank you everybody for the super helpful follow ups!
No Income Verification - Posted by SCook85
Posted by SCook85 on July 12, 2001 at 14:18:54:
Lucy,
You are in luck. There are loans that you can get whic are no income, no asset verification. They are based solely on your credit score. The terms are not quite as attractive (1-2% more), but they aren’t horrible.
To get the best rates and the best deals it helps to have a regular income, but if you are willing to pay a little more for the use of the money then you do have options available. Your impeccable credit is all that is necessary.
Steve
Re: Financing with No Income - Posted by JT - IN
Posted by JT - IN on July 12, 2001 at 10:03:27:
Lucy:
The title to your post must be a little misleading, in that you must have income, or atleast a way to repay borrowed funds, or there will be no loan to repay. So you probably meant ot say, without a regular weekly/monthly, precdictable, stated income, vs. NO income.
Documentation is the key issue, which you should have some of this with your track record you are establishing in your 2 deals you mentioned. The profits (realized cash flow, not equity) from these RE deals and others can be used for income and equity verification, in the form of a CF and Net Worth statement. You must tell the story, on paper, about how successful you are, so that Mr. Banker can “brag you up” at their loan committee meetings. The more profitable deals you do, the more comfortable the bank will be with your success and their willingness to fork over the funds, even absent a JOB.
With that said, I would keep the JOB, as long as you can, without it getting in the way of profitable RE deals. Once you are comfortable with being able to replicate the two deals that you have done, with ease, then get out of the rat race, then go for it! I can tell you first hand, it is great. As I sit here waiting for a Banker to drop off a $ 90K check, and have no JOB!
JT - IN
Re: Financing with No Income - Posted by JoeS
Posted by JoeS on July 12, 2001 at 06:48:08:
I agree with Bill, but after you get your ducks in a row, quickly give your resignation. If you need help doing deals, feel free to e-mail me for advise, I am NOT an expert or a “guru”, but I have done enough deals to know a thing or 2 (one will never know it all!).
Re: Financing with No Income - Posted by JD
Posted by JD on July 12, 2001 at 01:35:28:
I’d use my own money.