Can you use an unsecured personal line of credit to invest?
I currently want to invest in real estate but unfortunately i don't have the funds. A year ago i helped a relative get an apartment complex with an FHA loan by being there co signer but because of me doing this i don't qualify for any mortgage loan now. I dont meet the Debt to Income ratio under 45% that most bank require and putting a higher down payment is not an option for me and i dont have any family to help me with it either. I have researched other alternatives like hard money lenders to invest in real estate to fix and flip but they too a require a down payment that i dont have for or the funds to repair the house. So i did more research and got a bit creative and found personal line of credit. Is it possible to get an unsecured personal line of credit to pay the down payment and the repairs for fix and flip. By doing it this way i will have the funds to pay the down payment + fees and the repair cost. For example using a line of credit i would be able make monthly payments until its payed off. Is it possible to invest in real estate this way? If it is possible a friend of mine would like to partner with me so both of us would get a separate line of credit and split the repair cost and such to get the same result but with a lower monthly payment. Yes i am aware that i would need to pay for the interest for the hard money lender and for the line of credit but it will help me get into investing in real estate at the age of 22. I know that im using a lot of leverage to try to hopefully invest but how i see it is if the fix and flip goes well i would make enough to pay the hard money lender and the line of credit with using very little of my own money. If it goes bad as in i am un able to pay back the hard money lender and they take the property i would be stuck with the line of credit loan and make monthly payments. If the cost of repair is more then expected i would use the line of credit which would result in higher monthly payments but that is why my friend would help. If both of use get a line of credit we could split the cost and both of us can make smaller monthly payments to cover the repairs. This is just an idea of a strategy that i have to invest in real estate an would appreciate any feed back if it 1 possibility to invest.