Buying 1st rental for cash but want to reinvest

[Melvin Benzaquen]

I am about to close on my 1st rental home that I am paying cash for. I would like to somehow pull some or most of the value out of the house by some means in order to reinvest for additional properties and to have the down payment. My original intent was to buy, rehab and flip some properties to build up some additional cash before buying rentals but this house came up as a FSBO 3 blocks away in a hot area so I couldn't turn it down.

What is the best way to accomplish this?

[Josh Caldwell]

There are a couple of ways to pull out your cash.   You can refi out with a traditional bank.  You can create a mortgage for yourself and sell the note on the secondary note market.  You can also get a private loan on your property, and pay your lender back at any rate that you can negotiate. 

My question, before you go there, is why are you doing a cash deal?  Can you finance it up front and preserve your cash that way.  Is the seller willing to owner finance it, thus allowing you to have little or nothing in the deal?  I almost always buy with owner finacing to keep my liquid cash availible for super deals. 

I hope this helps

Josh