I'm VERY new to real estate investing. I'm not sure how to proceed with this idea my husband and I have so I thought I'd ask all of you.
We owe approx $86K on a house in FL as a first mortgage and then $5000 on a second (of which $2500 is forgiven every year from a loan restructuring we did a few years back and we are due to have $2500 forgiven this March). The house is currently worth about $140K. We want to move out-of-state but keep this house as a rental. The house needs a new roof, new a/c, new bath and updated kitchen. The location is very close to the Gulf of Mexico and this neighborhood is a desirable location and real estate agents in the past have told us we could rent our house easily.
Is it possible to use hard money or some other private money to do the repairs so we could move soon and get it rented out?
Updated 3 months ago
Blair made a great point which negates this post for the time being.
Everything you've mentioned is possible, however you should check with your loan forgiveness deal - you might have to owner occupy the property in order for that program to stay in place. I've also seen some of those programs that will reinstate the debt if you get move or convert to a rental property, so go back and read the fine print.
I would not recommend a hard money loan for repairs like that. You would probably be way better off getting a heloc.
Good point, Blair. I had forgotten about that. You are correct. I know if we cashout, the remaining $5000 would be paid off. Getting a heloc has been in our minds for the repairs for a while now but it doesn't sound like we could get enough $$ to make all the repairs we wanted at this time after paying off the 2nd mortgage. Thanks for the input!
@Sharon C. I would check with a local credit union. Some of them will go up to 100% loan to value on a HELOC.
Thank you, Ty. I'll look into it.
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