Multi family purchase and rehab question - help?

[Bob Mazza]

I am excited to be on the market for a multi family in Bridgeport or New Haven CT and am waiting for the right deal - total gut - full rehab required. I can buy the property all cash but would need funds for rehab - what are my options? I would like to avoid high rates with private money but feel it may be the best option for things. Looking at 3 units for $60k and rehab budgets at or below $100k Thoughts?

[Steve Gordon]

Hi Bob - why not obtain a normal mortgage and use your funds for the rehab?  After you have updated the property you can refinance and pull out whatever additional equity you have to use for the next purchase.  By using the leverage of a mortgage you can more quickly add additional properties to your portfolio.  Additionally any cash flow you make is at a higher cash-on-cash return.

Good luck and let us know how you proceed, reading member results is always enjoyable!