Just got approved for a $500k Line of Credit -
Ok so here's the situation:
I'm on a buying rampage right now, looking to buy as many houses as possible. My typical deal is $25k purchase, $25k rehab, and rent section 8 for $1200/mo. Then I can refinance at 80% LTV
A - I found one lender to do 1 deal with me as a "trial". Only 4 points and no down payment. They won't fund another deal until they see this one go smoothly
B - I have access to $230k cash from a private loan - this money is 100% tied up in a project that will be done in 8 weeks. I won't be able to refinance that for at least 90 days. It's only 5% interest and $0 down. Once i cash out that project I'll be able to use this fund more at a cheaper cost
I'm looking to scale this business - and found a lender who approved me for $500k line of credit. It's $6500 to buy into that program, then 4.5% points on every deal and 15% down.
Pros to LOC:
- Access to funds immediately, can buy 4 or more projects by the time the 2 above get done.
Cons:
- large upfront cost
- with 15% down on every deal, cash will start to get tight until I refinance all of them
Should I be patient and wait for A and B to start rolling - or buy into the LOC????
Help!