Investing in real estate is a well-worn path to growing wealth. Over time, in most locations, real estate tends to go up in value. There’s also a limited supply of land and steady demand for it. Becoming a landlord can be an excellent way for people to earn mostly passive income for decades, and generate wealth for their families for generations to come. All it takes is some understanding. And although the barrier to acquiring real estate is high, there are plenty of ways to finance investment properties.

The first thing is to understand the way real estate works. Investment properties are purchased with the idea that the buyer won’t live in them. They’re a different category entirely from primary residences and vacation homes. It can be harder to find financing for investment properties, at least at first. Banks and other lenders see investment properties as a more significant risk. It can be hard to get a mortgage for one. Investors will need to have excellent credit scores and debt to income ratios to get anywhere with banks.

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