How to Invest in Real Estate With a Private Money Lender in Singapore

calculating profit on real estate investments with a private moneylender in singapore

We are always looking for ways to earn more income that doesn’t just come from our fixed jobs. Having multiple streams of income can help sustain your monthly expenses with extra cash for savings and investments. A great alternative income example is investing in a real estate property as it can remain a consistent and lucrative income mode even if stocks crash. Being a landlord of a flat or a private house can earn you a monthly passive income but of course, it starts with buying a property, which can be a hefty price especially in Singapore. Unless you’re extremely wealthy, you will most probably need to apply for a personal loan to purchase your property and this may be an added challenge for some who already have numerous loans that they are paying off. In such cases, taking a debt consolidation loan in Singapore would be the best option. However, before we dive into applying for a loan and purchasing a property, let’s take a look at the financial responsibility needed to make this investment purchase. 

What to Consider Before Buying an Investment Property

Before purchasing a second property for the sole purpose of investment, it’s important to plan out your finances and budget the required amount to make this purchase. Remember, you will probably need to put down a downpayment initially in cash and you will also have to take into account possible repair or renovation costs. All of these costs can add up and may even require more loans, which is when taking a consolidation loan from a private debt consolidation lender will be beneficial (more on that below). Secondly, it’s important to plan out the possible Return On Investment (ROI) you are hoping to gain from your property. First, estimate the annual rental income you will be receiving from your tenants. This amount should be decided based on your annual operating income, which includes property tax, home insurance, and maintenance fees. You should be earning a substantial profit if you budget and charge the required amounts. Of course, any landlord has to have the time to manage their property. Before you get a tenant, advertising and impromptu home viewings can take up a lot of time so some may choose to hire a property management company to ease their schedule. 

Consolidation Loan: Ease Your Existing Debts Before Opting for a Property Loan

Purchasing a property on top of your current debt repayments such as credit card bills, student loans or a personal loan can be a nightmare. However, a great way to simplify your existing loans on top of the property loan would be to opt for a debt consolidation loan in Singapore. Keeping track of your compiling debts can be challenging but a private debt consolidation lender can centralise all your debts into just one loan with one interest rate. You will just have to focus on repaying one single loan every month, which will avoid the possibility of forgetting your repayment dates and incurring a higher debt from the interest rates. Any private money lender in Singapore will be able to offer you this loan, which will definitely decrease your combined interest fees so that your property purchase will be a seamless one. 

How to Earn a Passive Income From Your Property?

A passive income is all about receiving a constant stream of money without having to put in the working hours and an investment property does just that. First, you will have to approach a financial institution to apply for a loan. While local banks can offer these loans, some may opt for a private money lender in Singapore especially if they have a low credit score and need quick cash. As mentioned, be sure to pick a loan with a decent interest rate and loan tenure that is lower than your rental charges. The point of making your property a long-term investment is to be able to make a profit from it while also paying off your monthly debts using the same rental cash. Even once your property debt has been paid off, you will continue to earn a monthly income with 100% profits. 

Owning an investment property in Singapore can be a long-term lucrative stream of income especially if you have your finances planned and budgeted. Research properties in the area that can be rented out with a high ROI and choose a loan plan that complements the monthly rental. Both licensed money lenders and local banks will be able to offer a respectable loan so choose one depending on your personal financial situation. 

Pavin

Pavin

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