Joint Venture Partners
Looking for places to put your money these days are possible. You just need to know the facts. That is why the old fashion investing style of buying bricks and mortar can work best, for someone who wants security. Here are 5 Reasons Why You Should Have Rental Real Estate in your portfolio.
Leverage: Use leverage to substantially increase your ROI.
(return on investment)
Principal Reduction: As the tenants pay rent; they cover the mortgage payments, taxes, and utilities. They also help you pay off a portion of the principal on the mortgage.
Capital Appreciation: Selecting the correct property, in the right town, in the right area, one can begin to increase the appreciation above market trends.
Wealth Creation: Real estate values will eventually always go up, and have proven to be a powerful method of creating wealth over time. While values are increasing, debt is being reduced.
Diversification: As part of any investment, you should have real estate within it as this allows you to reduce risk by holding real assets.
Now that being said what if you don't have the cash to invest but you have great credit? Well, consider a joint venturing scenario. What is a JV? (Joint Venture Partner) Well the easiest way to describe it is a joint venture partner can bring to the table the thing you lack or he/she can add to your strength. If you have great credit but lack the funds, you can look for a partner for that investment that has the capital. They may have funds but do not want to go on title for various reasons, financing, DSR (debt service ratio), or personal reasons. There are many people out there in this situation, who just want a simple way to place their funds and have some gain on the tail end, or as monthly cash flow, in a stable investment.
What if you are the one with the funds? Then looking for someone who wants to use their credit can assist you in purchasing that property. Or you may have both but have no idea where to start, or simply do not want the hassle of looking after the tenants and need help in that area. This is the concept behind investing with joint venture partners. It is a win win situation for everyone involved. One person may have the expertise, and the understanding of where, how, why, when, what to purchase, while the other may have the capital but no other interest in learning how to do it themselves. This can be a great way to buy multiple properties.
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Hemlock Article in Muchmor Business Network Magazine
