Rental Property Investor · Valencia CA / Detroit, MI · Member since 2024 · 27 posts · 6 votes
Hello BP!
Been thinking about taking on a personal loan of 50-70k for purchasing power in my Midwest market, the loan would just be for down payments and closing costs on sub 85k SFH / Duplex properties. Any thoughts or insight? Anyone done this themselves or know someone who has done this before?
Lender · Nationwide · Member since 2023 · 362 posts · 237 votes
2y
With personal loans, the interest is very high. My recommendation would be to use that loan to do a BRRRR in a Midwest market, instead of using it as a down payment. In the markets I shop, there are plenty of properties that will cost around the 80k mark total (including rehab). After rehab is complete, you can work with a lender to do a cash out refinance and get into a conventional loan where the interest rate will be lower. Then you pay back your personal loan with the cash you got from the conventional loan. Be happy connect and chat more if you are interested.
Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
2y
Brandon, Credit score? Personal guarantee? Collateral? Interest only payments? Exit plan? It helps to provide more info when framing your ask. My 2 cents, Mike
Brandon, Credit score? Personal guarantee? Collateral? Interest only payments? Exit plan? It helps to provide more info when framing your ask. My 2 cents, Mike
Hey Mike!
Excellent credit score (795), personal guarantee I make 115k annually from my 9-5, no collateral at the moment. Also no exit plan, I guess the only solid thing is the loan isn't TOO much.
Lender · Nationwide · Member since 2023 · 362 posts · 237 votes
2y
With personal loans, the interest is very high. My recommendation would be to use that loan to do a BRRRR in a Midwest market, instead of using it as a down payment. In the markets I shop, there are plenty of properties that will cost around the 80k mark total (including rehab). After rehab is complete, you can work with a lender to do a cash out refinance and get into a conventional loan where the interest rate will be lower. Then you pay back your personal loan with the cash you got from the conventional loan. Be happy connect and chat more if you are interested.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
2y
If you don’t have a home with enough equity to borrow against. Buy a duplex as a primary and live in half for a year. Then repeat. One low interest easy to get loan.