If you want to get into the real estate game without much savings to get started, you’ll need to get financing. Of course, that’s easier said than done, as there are usually a lot of hoops to jump through. Don’t worry, though – it is doable, even if your credit score isn’t perfect. Use the following tips to secure real estate financing. 

Learn the Different Types of Loans

When it comes to financing your real estate endeavors, there isn’t just one type of loan to choose from – there are several. This is good, as it means you are more likely to find a loan that works for you. Some popular loans include government loans, fixed-rate loans, and hard money loans. 

Hard money loans tend to be a common choice for investors – especially those who like to flip homes. You can find personal loans from private companies to help you finance your real estate project. For example, private loans for construction projects will be tailored to meet your financial needs, allowing you to get started on the project without delay. Another benefit to loans from private companies is that they often pay out much faster. In the world of real estate, this is often necessary. 

Never Lie when Applying for a Loan

So, you want to secure a more attractive loan for real estate purposes. You might think lying on your application is a good way around this, but that’s not the case. Lying on an application will only reflect poorly on you, and most good loan companies will find out that you have given misinformation. Not only will it lead to a rejection, but there may also be legal consequences. 

Understand Your Credit Score

Your credit score will dictate the type of financing you’ll be able to get, so it’s important to understand it before moving forward. Here are the scores and what they mean:

  • 629 or below = bad credit. 
  • 630-698 = fair credit. 
  • 690-719 = good credit. 
  • 720 or above = excellent credit. 

After learning your score, you should then try to understand it. What has influenced the number? Many credit rating sites can help you determine not just your credit rating but also why it is that number. Keep in mind that a poor credit score doesn’t necessarily mean you won’t get financing – you might just have to go down the route of a hard money loan. 

Learn to Negotiate

Yes – you can negotiate to get a better loan. You don’t have to settle for the first offer! Of course, not everyone knows how to negotiate. It’s a good idea to learn some negotiating skills before applying for loans. Good communication and management of expectations will go a long way! 

Improve Your Credit Rating

After learning your credit rating and understanding what has influenced it, you should also work towards improving it, keeping in mind that this may take a while. This isn’t a short-term solution, but a better credit rating will help you secure better financing in the future. If you’re serious about getting into real estate investing, this will be necessary.