When Credit Lines Freeze

4 Replies

All of this talk about “recession” may start to turn into a self-fulfilling prophecy—— so curious to hear idea’s regarding credit lines... and what to do if they freeze on you! I have many clients who are utilizing credit lines on the coast and other markets and coming to my market and buying and renovating dogs etc. Curious to hear everyones thoughts

@Account Closed I was just speaking about this with my lender, who is also an investor locally in the Chicago market. He said credit is getting too easy, and he has seen this show before. The main thing is to have strong cash reserves in place and to have long outlooks/multiple exit strategies in place on deals. I am buying an apartment deal right now locally in my Berwyn market, and it is the type of value add deal that looks really good on paper with a 3-5 year hold. I want to be able to survive an interest rate rise at the refinance by having adequate cash buffers in case I ever had to bring money to a closing to refinance. This is easier said than done, but it is something I am trying to do more and more. For me, investing is a long game, and it is more important to not lose than to win big!

Originally posted by @John Warren :

@Benjamin Maciel I was just speaking about this with my lender, who is also an investor locally in the Chicago market. He said credit is getting too easy, and he has seen this show before. The main thing is to have strong cash reserves in place and to have long outlooks/multiple exit strategies in place on deals. I am buying an apartment deal right now locally in my Berwyn market, and it is the type of value add deal that looks really good on paper with a 3-5 year hold. I want to be able to survive an interest rate rise at the refinance by having adequate cash buffers in case I ever had to bring money to a closing to refinance. This is easier said than done, but it is something I am trying to do more and more. For me, investing is a long game, and it is more important to not lose than to win big!

Cash reserves are so crucial for that game to work. A lot of positive stories but moving from A to mid-west D is concerning. But----- When they move moved from A to For C, not so bad. 

Originally posted by @Account Closed :

By renovating dogs do you mean the D hood?  What do they say when you tell them its a bad idea?   Or do you edge them on?

Im fascinated by coasts investorS who think D is for Delirious amounts of profits.

 Yes.... D, for DAWGS. And not at all.... I like to sleep at night. 

Main point is---- what to do when the CL's freeze? And they call the coin???