Hi everyone, My husband I are wanting to buy some properties on the intent to either fix it up and turn around and sell it or rent it out. We own a house of a little over a year now and have some equity built up. The other thing I've though about is we could borrow against our home equity to purchase another home as a primary residence and the first home as a rental or vise versa. Any thoughts on this? What would be a wise decision. What kind of loan would we qualify for? Do we have to come up with a lot of money in order to do this? Thanks.

Sounds like you need to speak with your mortgage agent. He/she can help you determine your equity, estimated payments on an equity line, how to structure a purchase, downpayment requirements, estimated interest rate, etc...

While this is a frequently practiced traditional method of making your equity work harder for you... it also has several drawbacks you need to consider. One is the domino effect... by doing this your setting up what could be a very significant amount of your total Net Worth in a line where a problem in one could take the whole string down... unfortunately also a frequently observes occurrence.

Several ways to mitigate some of the dangers using this method but the best is to not over extend your principle residence unless you can take the "hit".

Far better methods are used by many knowledgeable investors where they minimize the out of pocket money and also minimize any short term mortgage responsibilities and never for the long term.

One of the ways is with owner finance... these type deals will not be found in the MLS or newspapers advertised as such... these are deals you must Make. You create these by selecting the most likely sellers, such as those no longer living in the property, those that do not need the proceeds of the sale to purchase a new property, those that are in a tax situation where deferred payments would benefit them, those that are in need of immediate relief from making mortgage payments on multiple properties... such as those that moved to a new job... and others.

Other methods include Options where for a small amount "control" the property. Lease Options are another method for both buying and selling... however you look for totally different terms depending on if your the seller or buyer!

Use of Asset Protections methods is strongly recommended when you have more than a few properties deeded in your personal name. LLC's and Land Trust are very inexpensive and easy to set up and provide a significant barrier to a total loss of all your assets due to problems with one property or mortgage or other law suites such as soft injuries.

Go to the library or local book store and look over a few inexpensive books on real estate investments. Look as several different authors and pick out what the seem to say that is common. Only consider books from authors that are presently active in the field they are writing about... many book pushers out their who have never or are no longer doing real estate investments but think they still know how.... things change fast in the field of investments. See when it was copyright and fact about the author of the fly pages.

Hello
I am going thru this with 1 of my client. The bank would not loan them money for a fixture up moduler home. they ahve to go thru the investor mortgage broker who is willing to give them a loan.
Before you put a contract verify with your loan office if he/she does this kind of loan.

Ritu

Hi
I read your message & understand your interests.
Email me, or call me I'm a mortgage specialist for Concord. I can give you some ideas & structure
your loan.
Mike Dent\
Concord Mortgage
im2piece@aol.com
1(631)393-3332
mdent@concordmc.com

Hi Mike. Hey are you affiliated with Concorde Acceptance?

Hi Greg: no we're not affiliated with Concorde Acceptance!

Ok thanks! How did your day go yesterday?