Pros and Cons of Financing Your Investment Property in Cincinnati

Are you looking for tips with financing your investment property? Before you lay out cash for your next investment property or seek out financing, there is a great deal to consider. While each investor may find one method of buying investment property more favorable than another, both have drawbacks yet benefit investors. Read on as we discuss the pros and cons of financing your investment property in Cincinnati.

Selling Your House for Cash vs Listing on the Market with a Realtor - Fort Mitchell House Case Study

Pros

Time

For beginners, financing your investment property in Cincinnatigives you the time to build equity and get started on building your real estate portfolio sooner rather than later. In real estate, the benefits realized from taking out a mortgage if you don’t have the cash far outweigh the opportunities and years of appreciation on the investment property that would be lost waiting until you saved enough money to begin.

Leverage

You can generate better cash flow by financing your investment property. By taking on the risk of a mortgage, you benefit from higher cash-on-cash returns, cash flow as it relates to actual cash invested in a property, calculated on a pre-tax basis. 

More Assets

By using other people’s money and financing your Cincinnati investment property, you can purchase more properties and diversify your portfolio to build security. In addition, having several properties in different areas makes it easier to ride out a downturn in one sector. 

Return on Equity

Financing your Cincinnati investment property also amplifies returns as you pay down the debt and the property appreciates. 

Taxes

Another benefit of financing your Cincinnati investment property is the depreciation of the entire value of the house when you carry a mortgage, which can be very beneficial to your tax returns. You can also deduct the interest on the mortgage.

Depreciation

Financing your Cincinnati investment property adds a buffer of protection from depreciation. If the property drops in value, you have lost your cash equity.

Cons

Delays

Financing your Cincinnati investment property may make you come in second with sellers considering multiple offers. It’s only natural that sellers prefer cash, which is a fast track to the closing table and has no lender to satisfy to ensure the sale goes through in the fast-paced real estate market we are experiencing.

Less Cash Flow

Mortgage payments and interest eat into your cash flow when financing your Cincinnati investment property. While other expenses add up, your mortgage and interest on the loan will take the most significant chunk of your rental income.

Qualifying

Building up your creditworthiness and saving enough for a down, and qualifying for financing your Cincinnati investment property are all achievements that are much easier said than done. Although you may find the need for alternative financing options, speaking with an experienced investor like the professionals at We Buy NKY Houses can help guide you over any hurdles you face in attaining financing or building your credit and savings.

Credit Risk

Financing your Cincinnati investment property means extended problems with payments from tenants or even vacancies are a more significant problem; carrying mortgages carries a potential for foreclosure and damage to your creditworthiness.

Pros and Cons of Financing Your Investment Property - We Buy NKY Houses

Help in Buying Investment Property

If you’re buying a home in Northern Kentucky or Cincinnati area property, We Buy NKY Houses has the experience you need to help make the buying process easier, less time consuming, and we’re on your side to help make sure you get the best deal while we worry about all of the details.

Either way, countless local home owners and investors trust We Buy NKY Houses to help them wade through the real estate buying and selling process while keeping more cash in your pocket and helping you save the time and headache of working with less experienced brokers.

Then give us a call! We take the time to listen to your concerns and answer any of your questions here at We Buy NKY Houses, with no obligation. Contact We Buy NKY Houses at (859) 412-1940 today!

If you’re ready to buy and considering financing your Cincinnati investment property, the professional investors at We Buy NKY Houses will answer any of your questions or concerns. Our focus is on you at We Buy NKY Houses; we’ll stop and take the time to listen so we can help you take the steps best suited to your unique circumstances to realize your investment goals. You can count on the full-service team at We Buy NKY Houses, from locating the right investment property to property management and everything in between. Don’t forget to ask about our current inventory of the best investment properties available in Cincinnati. Contact We Buy NKY Houses at (859) 412-1940.

IF you have questions like : What are the disadvantages of real estate investments?
What is the greatest disadvantage of real estate investments? What is the best down payment for investment property? Then give us a call. Then give us a call. Our Real estate experts will be able to answer any questions you have, can make recommendations and may be able to provide you an offer over the phone!

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