Hi All. I currently own 2 SFHs outright (no debt and both in my LLC) and wish to purchase a 3rd. I have $50K but would need about $85K for the 3rd home. I don't want to do a traditional mortgage since the amount is smaller and the fees are awful in TX. Is my best bet simply a personal loan? I probably could pay off the $35K in about a year or a year and a half. Ideas? Suggestions? Thanks everyone!
You could try a HELOC on one of the other properties it might be a bit better interest rate than a personal loan.
Hi Aaron. Would a bank do that if the property is in my LLC? (Can you tell I'm new at this?)
@Alfred Litton Have you considered asking a friend or family member for a loan/mortgage?
Depending on the LTV they could be very comfortable with the collateral and you could win by not paying off all of the fees.
@Alfred Litton I'd ask the bank, and even if they don't you will probably be able to find someone to give some sort of commercial loan with one of your properties as collateral.
a conventional mortgage is the cheapest loan you can get.
a heloc will be cheap, but have a higher, usually variable rate, and much harder to get on investment property
a personal loan is most likely not going to be a viable option. unsecured personal loans have high rates and require high liquid capital
@Alexander Felice. I am able to pay the loan off in about 12 months, no problem, and I have about 2/3 of the cost of the home saved in cash. So I'm less worried about the interest rate than the crazy fees/closing costs on a mortgage.
@Alfred Litton If you want to go personal unsecured loan, you can try lightstream. Super easy and if you have good credit they will fund within a day or so.
BUT, since you currently have properties in LLC, I might suggest trying getting a commercial loan cash out refinance on the two houses, and pay cash for the new house (it will have to be in the same LLC as well). This will get you into new arena of real estate and you'll be able to grow the business quicker down the road.
@Zack P. Thanks! I'll check it out.
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