I am a 37-year-old with a wife & 3 yo daughter. I recently lost the largest account I had for my home-based music business and am looking to transition to real estate investments. My income has declined exponentially after the loss of my largest account, but I paid off the home I live in 8 years ago and have very little overhead.
My home currently comps for around $330,000 and I could potentially convert it into a duplex.
My income has declined so much that I'd likely need to get a co-signer for a loan and I'd be relying heavily on the passive income from my investment(s).
Any insight/advice for my situation would be greatly appreciated.
Quite a few investors use their primary home as collatoral for a HELOC and use that for their investments. Most banks still would be looking at your income, is my understanding, however in some senses because you have your house paid off and so much equity in it, a bank would be silly to not lend on it and be in first position. So, your income may not be as much of a detriment as you think. I'd talk to some banks.
Those funds can get you rolling with real estate, however you will bump into the same question you raised on the brrrr (refinance) part of that, if you were to want to do buy and hold. That's where I'd expect the income to possibly be a limiting factor a bit more.
@Jim Goebel thanks for the reply.
Thru my reading, a HELOC seems to be the way to go for me.
I'm def gonna start doing some digging at banks and see what I can come up with.