Creative financing - alternatives to mortgage
I recently tried to take a mortgage out on a condo that I own free and clear. The bank did not allow it because 28 of 40 units in the condo association were rented out and not owner occupied (I rent mine out as well). So now I'm in a dilemma. I want to take money out of this property, but I don't want to sell the property. Does anyone know any creative ways to get a loan backed by this property?
It's a 2Bed/2Br, 1000sf condo, worth about 80k in my estimation. I'd like to take 50k out.
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Greg, you could write a mortgage against the property and sell the mortgage. Your effective interest rate will be high because the investor will discount the mortgage. But that's a way to get cash out while maintaining 100% ownership of the condo. $50K would be a 62.5% ITV for the investor if your estimate of value is correct.
Or, bring in a partner and sell them half interest in the condo for $50K with you doing all the management and splitting all costs 50/50.