In our latest Belgian property article Yannick Callens wonders why financing is so scary in real estate.
When I give my seminars and my coaching, there are often three points that are asked of me: How to find the right deal? How can I best finance my purchase? And how can you pay as little tax as possible? These are the three points that often block my students, but shouldn’t this be seen as three opportunities? It’s easier to say that there are opportunities everywhere than to say that there are no more great deals to be found in real estate. It’s easier to see your banker as a partner than as an obstacle, and it makes more sense to focus on taxes afterwards than thinking about it before your purchase is complete. I would like to go into more detail regarding property financing. There are several ‘scary’ aspects of the fundraising process. The fear of ‘no’, the fear of rejection, the fear of the other person, etc.
I’ve met so many people who want to do real estate who have this fear. We often project onto events from the past that have marked us, or we project into the future on things that have not even happened yet. These famous regrets and these notorious passions. My advice is to focus on the present moment, the moment T, and make decisions about now. I prefer to see the past as a lesson rather than a mistake. There are no mistakes, but rather lessons to be taken with you. If you have a ‘no’ from a banker or a case that’s being held up, ask yourself how to improve it for next time. How to come back stronger to get there. Never forget the goal. Getting to finance your purchase in order to make the purchase. In real estate it’s 0% or 100%, you either do it or you don’t. I often compare it in my presentations to this: “Honey, today I love you 70%.” That’s surely not right.
You have to give the best of yourself to achieve 100%, ditto for financing. Currently, in this problematic situation, in early 2020 it was more difficult to obtain credits. The financing rules had changed considerably, at the specific request of the BNB (Belgian National Bank). During the months of lockdown, banks were unable to provide credit and the real estate market was at a standstill. It wasn’t easy to visit, make offers and send your request to the bank. It was even forbidden to visit apartments and houses.
Now, arriving in the last months of the year, banks are easing up on credit. A bank is a commercial company that must also achieve its objects. Is this the right time to launch your fundraising file? From my perspective, I would say this is the best time. The relaxation of the rules and the grants are favourable. Also, don’t forget to let the competition play in order to have the best conditions. Never forget that your banker is your partner for several years, sometimes even a decade.
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