Auto Financing

Many people purchase a vehicle, motor home, boat, or ATV after doing a ton of research. They generally know the color, make, model and edition that they want. It’s interesting to me that they would do all of this research on their purchase, but still just walk in and take whatever financing option the dealership offers.  I can’t sit here and say that a bank or financial institution can always provide better rates and terms, but frequently they can. My advice is to at least do some research on the lending options while searching out your new toy.  I will give you the steps needed to purchase through your bank.

Timing – The most important thing to keep in mind when financing through the bank would be to give yourself and the bank enough time to get the loan done. All too often the borrower comes in hours before going to the dealership and this is not enough time to get the deal done. The borrower then ends up having to settle for whatever loan the dealership is offering.  Generally speaking, allow your bank a couple days to approve you.

Pre-Qualification – now that you have reached out to your banker in advance, you need to have them pre-qualify you.  They will take an application to make sure your credit and income is in line for you to make the purchase. They may need some of your financial information that I have discussed in previous blogs but it should be a fairly simple process.

Shop – Once you have the green light that you are approved by the bank then go out and shop for what you are looking for. Pick out the car, truck, boat, motorhome, or ATV and let the dealer you are pre-approved through your bank. Tell them that you need to have them send the purchase contract over to your financial institution. Once the bank has the purchase contract we can cut the check for the dealer. Usually once the dealer knows that you are pre-approved they will draw up their paperwork for the vehicle and let you leave with it. The bank will take care of issuing payment to the dealership.

Financing through your banking institution may take a little bit longer than just walking into the dealership, but if you can get a better rate then it will be a valuable choice for you. On the flip side, if the dealer is offering 0% interest on the loan then you should jump on it, but with a rising interest rate environment that is less likely. As always talk to your banker if you are in the market for a new vehicle or toy and see if it is something they can help facilitate.

Please leave a comment or contact me with questions.

 

 

Buying an Investment Property

Buying an investment property can be a hobby, business, or a way to supplement your income. People buy investment properties for numerous reasons. In this post I will discuss a couple of the most common reasons that people tell me as to why they are buying an investment property. In this article I won’t break down all of the rate, term, and financial differences in the lending procedure from a traditional purchase and an investment purchase, but rather some tidbits I have seen over the years.

HGTV Effect – We have all seen Property Brothers, Flipping Vegas, Flip or Flop. I have been told on many occasions that people want to try and flip a home and make some quick cash like they see on TV. This is probably the worst reason in my opinion to buy an investment property. Those shows are often like magic shows in that they show you what they want you to see and they always make it look very easy. In reality they are often very talented and doing this on a massive scale, so when they are telling you that the house is going to cost $50,000 to renovate that’s with their team doing the work at contractor pricing. That’s the reason they can do a whole house for the price that it costs you and I to remodel our kitchen. Also, the margins between the purchase and selling price are so low now that it’s extremely difficult to turn a profit, especially in the Nevada Market. My advice to you if you want to try this is to speak with someone that has had experience in the flipping business and really pick his or her brain because it can be done, but it is difficult.

Earn a Higher Return – Let’s use an example on this one. I have a friend that had $20,000 sitting in the bank earning .05% interest, basically earning you $10 per year in interest. This is very common for people to just leave cash in an account earning little to no interest. Instead, he went to an auction and purchased a condo in a pretty rough development for $20,000 cash. He put about $1500 into it for a total investment of $21,500. He rents it out for about $550 per month and the tenant pays the utilities. So as opposed to earning $10 for the year, he earned $6600 for the year. He has since purchased 3 more in the same development. They have gotten more expensive over the years, but that also means that they are gaining value as well. His goal is to continue to buy them cash or pay off the loans very quickly and ultimately have a large investment portfolio creating an additional income stream for him.

Investment properties can provide excellent income and offer you the opportunity to try your hand in a different area of real estate than you are probably used to. As always, I recommend you consult with your team of professionals to make sure you do your research and are well informed of the process. Good luck and happy investment property hunting.

Please leave a comment or contact me with questions.

 

Condo Living

As you drive down I15 in Las Vegas you can’t help but notice all of the high-rise condo’s along the strip. But, have you ever thought about living in one? I know when most people in Nevada think of home ownership, they think of your standard single family home. If you live in New York, Chicago, or San Francisco condo living is much more common, but as Las Vegas Grows I believe more condo’s will be built and there will be a shift to condo living. There are many reasons that people prefer to live in a condo and I will discuss them in this article.

Maintenance – Many people enjoy planting a garden, mowing the lawn, and doing little fixer upper type projects around their home. There are also many people that don’t. Living in a condo eliminates most of the work outside of the condo. The exterior of the property is all taken care of by management and is usually covered by your HOA fee. If there is something wrong with the building or there are weeds out front, it will be taken care of by the maintenance team. This frees up your time to enjoy the amenities.

Amenities – Depending on the condo that you purchase, you will get to enjoy the amenities they have to offer. Common amenities include, indoor/outdoor pool, gym, valet, tennis, basketball, doorman, security, bar, etc. Again, this is all maintained by the condo and covered by the tenants HOA fees. This is great if you are active and like to have all your amenities under one roof. When purchasing a condo, this is one area you want to really research to make sure you are getting exactly what you want out of condo living.

Social – Living in a community under one roof will really bring people together. Condo’s will usually have different mixers and events that build the sense of community and togetherness for the residents. You can try to avoid these if you want, but generally people looking into condo living are outgoing and are looking for that sense of community. There isn’t a better way to build a community and friendships than Thursday Night Karaoke in the lobby bar.

Location – Condo’s are usually built with location in mind. Part of the allure is that you will be close to restaurants, night life, sport venues, and other important attractions. People that live in condos often like the ability to walk places without having to drive across town to get somewhere. They also tend to be set up with views that are far superior to most homes depending on which way your unit faces.

Price – Perhaps the most important aspect of Condo Living is the price. Condo’s tend to be priced below stand alone homes, although they can get pricey if you want them to. Let’s use the example of buying a 1200 Square Foot condo for $280,000 with 20% down, you would have a loan for $224,000. Your payment would be about $1000 per month plus taxes and insurance. If you have an HOA fee of about $200 per month then your total cost would be about $1400 per month for hassle free living.

There is something about owning your home that is very satisfying, so you just need to figure our what “your home” looks like. If it is condo living then contact your realtor and lender and get the process started today.

Please leave a comment or contact me with questions.