Monday, October 10, 2011

Real Estate Investor Mistake # 2 - Not Using Government Grants, Loans etc.

It is a well known fact that governments from the municipal all the way to the Federal level offer various grants, tax incentives and/or loan programs.  Of course there are rules to follow, but it's important to understand every program that's available at your fingertips before making an offer on a  property.  

Programs such as incentives for investors to rehab properties in certain areas of a city (revitalization programs); various loan programs at all government levels that offer low interest loans, or forgivable debt in some instances.  Check for various grants offered...Various local governments may offer lead abatement grants.  These grants typically apply to pre-1978 built housing and help you in dealing with lead based paints used on the property.  Dealing with this issue can be very expensive and if the government is offering a helping hand, then why not take that hand?

Tax incentives are also available from time to time from all levels of government.  These incentives are designed to attract investors in various areas that are in decline to help increase economic development in the area.

Cash is sometimes available for rundown areas and in order for the city to get funding the following year, they have to spend the funds that they have this year.  So they may be very motivated to hand out the money.

Procedure:  Call the Office of Economic Development (or its equivalent) in the town, city or state you have an interest in.  If they don't have such an office name, then narrow things down by finding out who is in charge of that level of government you're calling.  This could be the governor's office, the mayor's office etc....

It's worth the time to investigate these opportunities because if they suit your purpose, the little time you have spent on the phone will be well worth the effort.

No comments:

Post a Comment