If you guys and gals of BP have not read this yet, you [email protected] Anastasi has used a creative financing source (Peer to Peer lending called Prosper) to buy a house and then she was able to pay it off in 3 years. See link below:
This inspired me pose this question:
What other creative (or non traditional) financing ways or methods or sources have you used to acquire a property?
Share them with BP Nation. By doing so, we'll all benefit.
Here's my share:
- using a BUSINESS LINE OF CREDIT
I know a BP member who qualified for $87,000 business line of credit. He and his 2 brothers plan to use this BLOC to buy a house, rehab it and once they sell the house, pay off the BLOC and pocket a nice profit.
What's a business line of credit?
How do you qualify for it?
Do you need any real estate experience to get a business line of credit?
Here are the answers:
1) A BLOC is an unsecured loan based on your and/or your company's credit. Some BLOC providers give you a "check BLOC" - meaning you can write a check and others provide business credit cards. You can get cash out of these business credit cards as well.
2) To qualify for it, one BLOC provider I work with, requires your credit score to be 720 or above. They also look into your debt to income as well but the most important factor is your credit score. Also you need to have an LLC or corporation or a legal entity (it's a business line of credit not personal).
3) The cool thing about this BLOC: you don't need real estate experience. The BP member I know is a newbie with no real estate experience. Also, some BLOC providers also don't care that your LLC or corp is brand new.
SCAM ALERT! - beware of BLOC providers who charge an upfront fee. Those are most likely scammers. Only go with BLOC providers who charge a success fee. Only when they succeed to get you funding, that's when they get paid (and they get paid a percentage of the money they raise; typical percentage ranges from 8% to 15%).
So there's my share of a creative or non-traditional way of acquiring a property. It's not "earth shattering" or extremely creative but if it helps a BP member find another way to acquire properties, then I guess, it's worthwhile sharing.
What about you?
Below is the link to Dawn's use of P2P lending to fund her house which she paid off in 3 years:
can you share the BLOC provider you work with?
What rates do they offer though? I tried to get a small business LOC at 4.75% through a very investor friendly bank and their under writer ultimately turned it down because they didn't like the idea of me using a LOC to buy more real estate...even though it was for my real estate business. It was a blessing in disguise though, as I qualified for a larger amount at the same rate 2 months later via a HELOC.