Often time’s investors will come across a great deal on a house they find, but they don’t have the expertise to find the money they need to finance the property. There are many sources of money to finance these great deals you come across. Here are a few sources of funding houses in Knoxville TN.

• Hard Money Lenders. – Hard money loans are short term loans with very high interest rates and upfront points. You can expect to pay as much as 3%-10% in upfront costs to secure a hard money loan. However, for short term projects, these can be a great source of cash.
• Other Investors. – If you truly have a winner of a deal on your hand, other experienced investors may be willing to finance the deal in exchange for part of the profits. You might try joining a couple of real estate investing groups and make contacts so that you can find these other investors.
• Non-Owner Occupied Loans. – These are loans from traditional lending institutions that work similarly to single family residential home loans. They look at your debt to income ratio and credit rating to determine if you qualify. Non-Owner Occupied loans apply to investment properties of 4 units or less. Be aware that tax laws for Non-Owner Occupied Loans can differ from a standard mortgage loan; always check with your tax advisor or attorney.
• Commercial Property Loan. – These types of loans are from traditional lending institutions and work differently than a residential mortgage. Commercial property loans are based on the property. In this type of loan the lender will take into consideration whether or not the value of the property can support the loan, your character as an investor, and the liquidity of the collateral.
• Seller Financing. – Another option would be to ask the seller to finance the property rather than have the bank finance it. Seller financing is negotiated on a case by case basis.

As you can see, there are many different ways to finance an investment property in Knoxville TN. If you truly have a great deal on your hands, there should be no shortage of options for you. Always check with your tax advisor or attorney to see how your individual situation is affected.

There is a lot more free information available to you about buying and investing in Knoxville real estate. For complete information about the Knoxville real estate market including current Knoxville TN homes for sale and more please visit the Knoxville TN homes Web site at www.davidhamilton.com.

David Hamilton may be reached most days, evenings and weekends by cell at 865-310-0636 if you need to make an appointment to preview Knoxville TN houses.

David Hamilton
Ferguson Realtors
865-690-1300 Office