I am looking at a single family house for my first investment property, the asking price is 29900 and I am sure I can get the property at 20k. The home needs a roof and siding replaced to make it look presentable, the inside has already been inspected and approved for tenancy.
I have 16k cash on hand, how would it best suit me to proceed with the financing to benefit cash flow and taxes? The property is rented for 600 a month and the utilities are paid by the tenant.
I would like to purchase more in the near future, what strategies should I use?
With such a low purchase price, you may have a moderate-hard time finding a mortgage. Also remember that there are standard closing cost related with any size mortgage. Your closing cost on this size of a loan may be your largest expense, cutting into your ROI. Maybe save up for a little longer and buy in cash.
I would try to get a loan since it will be a rental. That way you will have money for the repairs or the next deal. Paul is right, it may be tough to get a loan that small. Find a small local bank and see if they will work with you.
@Jason Smith - I would suggest start looking for refinancing options from private mortgage lenders, credit unions, banks. The last resort would be HML.
Looks like you leverage flipping, its good to have access to money. Meaning if you find a great deal you can call people and have the funds ready in short time-frame.
Refinancing, credit cash advances, HELOC are good sources and once you have initial equity you have to start building by increasing the volume of flips
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