Cashing in on equity from foreclosures

7 Replies

I'm new to investing. I'm looking into using a hard money lender to purchase a 1700 sq ft foreclosed home selling at $25/sq ft. Average in my area us $85-95 sq ft. I havent done a walk through yet but from pictures it loojs to be in pretty good condition. Definitely liveable condition. I'm hooing to refinance after a year and cash in on some equity to use for the next rental. My estimates are that the house ciuld sell at $80 sq ft. Does anybody experience doing this? Also, is there anything I should be on the watchout for? Thanks in advance for the help!

I would purchase it under your name and not a LLC. I tried to refinance a property I got at foreclosure and held for a year. The lender was one of the highest ranked, and we went through the entire process until finally they said I had to change it back from my LLC into my name and hold it for another six months. Nope. I got the LLC for protection of my assets and do not want to do this. I'm checking with other banks and credit unions at this point.

@Helen Kirk my question was assuming that you were to refinance under your name instead of your LLC. I was just trying to find out the process if you had to refinance under your name and then try to get it transfered to your LLC. Sorry about the confusion.

@Matthew Spaulding If I put it back under my name and held it for six months, yes, I could refinance it. I could then quit claim it back to my LLC's name afterwards, but run the risk of having the bank declare the loan due and payable since it changed "owners". I want it to stay in my LLC, so I'm holding it for now and will revisit the refinance later on with a portfolio loan at my credit union.