Question about allowing someone to buy in

5 Replies

My partner and I have two condos that cash flow $300 each. Put togerher we have about 175k in equity. To raise cash for another deal we were thinking of allowing someone to “buy in” and give us cash in order to come in on these existing deals. We would just add them to the title and then split profits three ways when it’s time to sell. But we would use the cash we would raise to purchase another rental. Is this a logical path forward?

with that much in equity have you considered using a HELOC?

or maybe even just doing a good old fashion refinance ?

it seems that taking a route like these would be much cleaner to just pull out your current equity and use the new cash flowing property to pay off or back the heloc/refi 

and with the heloc you could repeat this process 

@Will Gile

Once set up, you wouldn't pay interest on the heloc until you tapped into it and drew money out. You would be paying back interest and principal starting day one if you did a cash out refi. You would also have a higher interest rate I believe on a heloc and the bank would have more power on calling or canceling the line if a down market were to occur is my understanding.