Updated about 7 years ago on . Most recent reply
Financing using equity
I have a family friend who is offering to sell their house to me for $100,000 plus closing costs etc. The value of the home is worth $225,000. He is a trust fund individual and is only offering this price to me because he wants to move to Hawaii so he doesn't mind selling it for that. This would be my first buy and would love to keep the house as my primary residence. My question is, is there a way to use the 125k equity in the house already to fund an investment like a flip? Would this be something like a brrrr strategy? What would be the downfall of doing this such as increased payments on the primary house etc. Thanks
Most Popular Reply
Yes it is called a HELOC, however I am very doubtful that he is selling you a $200k asset for $100k if he is and it is clearly under market value you may want to talk to an accountant and make sure you don't have to pay taxes on it as it would essentially be a gift.