A landlord is only as successful as his property will allow him to be. If you don’t have a good rental property or you overpaid for your property, you’ll have a difficult time finding success as a landlord. Choosing a rental property is the most important decision you’ll make, so you have to be absolutely certain that you’ve put in the research to help you come to the right decision.
When selecting a rental property, there are some questions you need to consider.
• Can I afford the down payment? Many lenders view rental property as a higher risk, and as a result, they often ask for a bigger down payment on the loan. Sometimes, they could ask you to put down as much as 40% on the property. Talk to your lender to determine how much you’ll have to put down, and if you can’t realistically afford it, you’ll need to consider another property to invest in.
• Will the market rental value cover the mortgage? This boils down to simple mathematics and Being a Landlord 101….