Hey, BP--here's my dilemma:
I'd love to continue investing in buy & holds, but most of my money is tied up in a flip last year that didn't sell in time, so I wound up renting it out and doing a refi to pay off my HML. It has a decent cash flow & good tenants, but after carrying costs & other expenses, I don't really have any extra money of my own right now for both a down payment on the next investment property and keeping my own reserves intact. (The plan was to use a HML, requiring 20% of the purchase/rehab costs, for the BRRR method.)
So, I figured I’d bounce some ideas off my fellow BP-ers to make sure I’m not either missing a solution--or about to jump in over my head with anything.
- I've already refi'ed my investment property at 75% LTV, so I figured a HELOC for an additional, smaller amount (enough to help w/ a down payment) would be out of the question...correct, or no?
- I thought about using a Lending Club, Uplift or friend/family loan for the 20% down payment--but I'm afraid of overleveraging myself with paying monthly interest rates on 100% financing (of course, the goal would be to quickly flip or refi the property ASAP). But is it even possible to have those loan types in 2nd lien position (after the HML's 80%) anyway?
- OR, should I just wait until my tenants’ lease is almost up (late summer/early fall) and approach them about possibly buying the house (or I put it back on the market), and use that capital to start over with future buy & holds?
My head's kinda spinning right now in terms of what to do...it's a little frustrating because after hearing all these "50 doors in 5 years!" examples, I feel like I'm at a standstill, that things are taking longer with this REI thing than they should. But I'm also trying to be as realistic & smart about things as possible.
Thoughts & feedback as always are welcome!
I forgot to mention that one thing I am doing is focusing more on direct marketing for potential deals where the owner might be interested in owner financing...so, there's that as well. :-)
I know this is an old post, but have you considered marketing the property to investors as a turnkey investment property?