I have been seeing more and more information come out saying that buying property through business credit is a very good way to build wealth and to aquire real estate.
My question is, has anyone that may see this post gone through that process at all or know what to expect with a realistic point of view, and what details to look out for ?
Secondly, what are your thoughts on using this process, buying proerty using business credit ? Is it a legitimate way to expand a big faster ?
Thank you for any and all input !!!
Happy Thanksgiving also !
I have not personally done this.
But i'm not sure that it is the best of ideas. While many people will say that the have done this in the past and that it has worked out. The issue with credit cards is that the interest they charge is very expensive.
If the project that you're working on doesnt go as planned then you'll be charged 20-25% interest. Which is something that is not easy to get out of .
I setup business credit with WF and business credit cards with 0% teaser rates. I was only able to obtain this financing and credit through submitting my tax returns showing profitability from the business. They provide a certain amount of credit line or credit card based on the income you are able to provide as documentation. The lines of credit and 0% business cards have helped to complete more projects, but as always it can come back to bite you if things go sideways.
I have a 35k credit line through my credit union for my online gun part business that I also use to buy real estate. I believe it is just over 6 percent apr. I have used it to pay for a bulk of a duplex and a fixer upper single family. I mostly see it for areas where houses are less than 50k.
You don't want to use a credit line like a 30 year mortgage. More of a 2 year personal loan. So profit on rentals is about zero upfront due to agreesive payment schedule.
Also great for unexpected repairs.
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