A Beginners Dehlima
**If I moderator could edit the title of this post to the correct spelling, it would surely be appreciated! I can spell dilemma however I hit a key and created my post while I was typing. :)
Young and eager learner here. I have read all of the books published by BP and then some. Here in Tampa, I have two complicated situations at my feet and I am curious if they can work to my advantage or if I should start elsewhere.
Situation one: My current house is a single-family, 4/2 owned outright by family from which I will purchase way below market value.
Situation two: Another family owned house, same area, same blueprint, which is in need of renovation, could be potentially secured by me at a very low price, under market value.
I seek advice on which leverage I should aim for in making money and making the money work for me. I am also constantly browsing the marketplace for duplexes and multi-family which are in the C and D neighborhoods of the area. My primary questions are, should I use my current house as leverage for a multifamily in terms of a HELOC? Should I tap the equity of my current home, once I have it secured and invest into the other single family property? Should I disregard the additional single family and solely focus on the multi-family side of things starting out?
I have modest savings, average credit and no savvy connections that I can currently utilize to structure financing, so I will be reliant on conventional or private lending as far as I know.
Any advice would be amazing, as starting seems to be the most difficult task so far.
@Sean W., If you own your house outright the HELOC sounds like a great idea. Deciding on if you should only focus on Multi Famil vs SFH's is totally up to you. Both have positives and negatives. Search the forums as there are several posts regarding the goods and bads of each. I purchased my first rental using a HELOC on my personal. I would then use the BRRR method and pay the HELOC off until I found another property to purchase.