Okay Guys for the next few days I wanted to run through information about costs that are associated with real estate investing. We will discuss some things that should be considered once the real estate comps have been researched, but before you make an offer. Taking advantage of your InvestorCompsOnline account will help you determine what are good or not so good investment deals.

One of the first costs to consider is rental income. And unfortunately it is not as straight-forward as it seems. Sometimes properties are under-rented and sometimes properties are over-rented, so be sure to find out the market rents when you consider a property.

A huge cost is mortgage interest. You should definitely sort out the details of your loan options and get an idea of current rates before running the numbers. It could make or break a deal. If you are getting a duplex or a house, the loans are generally similar to other home loan programs. One thing to consider is to put more down because the more you put down, the less your loan will be, which means less monthly interest to pay. Another consideration is the type of loan. We usually recommend for people to get a fixed rate mortgage these days because the current ARM (adjustable rate mortgage) rates are not all that much lower than fixed rates.

Basically, be sure to get educated about the loan options and run the numbers with them. See which type of loan serves your best interest.

Tomorrow we will discuss taxes and vacancy costs that are incurred in real estate investing.


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