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If you learn how to buy houses by taking over payments subject to existing financing, you'll add a highly profitable skill to your arsenal of real estate investing weapons.

How many loans are really out there that you can take over payments on? Recently the American Bankers Association reported that in a single year there were close to one trillion dollars of new mortgages created from refinancing existing loans. Most of these loans were made at low 6%-8% fixed interest rates.

What it means to real estate investors nationwide is there're trillions of dollars in highly desirable low interest financing locked up in houses people own right where you live. Wouldn't it make sense to learn how to take over payments on these existing mortgages that somebody else qualified for and obtained - to buy the very houses the loans are attached to?

You should be taking over payments instead of getting investor loans that are being given out mainly because investors are saddled with a high rate of interest on loans unlike home owners by mortgage lenders.

Once you succeed in taking over payments, be assured of the low rate of interest at which you will be paying unlike other real estate investors. Thus, your loan repayment expenditure decreases considerably increasing your monthly cash flow. In the future if you decide to sell the property with proprietor financing and maintain the original loan as well. You will be able to make a better deal on the interest and payments than the ones you assemble from your procurer.

Taking over payments has another valuable benefit. Remember, the bulk of your monthly loan payments will go toward interest, while only a small portion of each payment will apply toward a principal reduction. With lower interest financing on the existing loan you're taking over - you'll pay less interest and overall for the property.

If you consider taking an investor property loan, the down payment required is much more than for homeowners. Homeowners offer around 5% while real estate investors are asked to put down around 20% while procuring the loans.

Moreover, real estate investors have to show at least 6 months worth of payments in cash reserves while a homeowner can get away with just 2 months in reserves. If you're taking over payments on a homeowner's existing loan, you'll no longer have to come up with a large 20% down payment. This, in turn, means with the same amount of capital you can buy a larger number of properties.

But we're still not quite done yet. When you take over payments on an existing loan you benefit from all the loan payments previously made by the owner. Remember, the owner has originated the loan 2, 5 or even 10 years before you came along wanting to take over payments. The more payment the owner made on the loan you're taking over, the fewer months and years are left to pay on the loan until it is completely paid in full. So, taking over payments on existing loan speeds up the process and allows you to pay-off the loan balance and build up your equity a lot quicker.

Last but not least, when you take over payments on someone else's loan, you completely avoid tedious mortgage loan qualifying process. The owner of the house has done all the paperwork and has furnished the necessary proof of his creditworthiness to the lender at the time when the loan was originally obtained. You're simply stepping in to benefit from the results of lengthy loan qualification process the owner had to endure.

This process is perhaps the easiest way to finance the purchases you make as a real estate investor.