I'm wanting to purchase my first fix and flip and I've been coming across some lately that the numbers work on. I'm hoping to get some advice regarding the financing of the home/repairs based on my current situation.
Here's my current situation:
I have a great relationship with a local bank that specializes in loans for investors. They have basically told me that I could get a loan on pretty much anything if I can put down 20%. However, in my target market I really don't have the cash on hand to put down 20% and I'd rather not touch my cash on hand if I don't have to. What I do have is a home that is paid off (value of approx 350k).
I understand that I could borrow against my equity using a home equity loan or a heloc. However, most of the homes in my target market would cost more to purchase/fix up than I would be able to get in an equity loan.
So I'm wondering if it would be possible for me to get an equity loan and use the funds to put down 20% on a loan for a home/repair costs with this investment bank I mentioned? If it is possible to do this and one of these wouldn't disqualify me from the other, is it recommended? Or is there some other way that I can obtain financing on a home/repairs that costs more than the amount of equity I have. Any advice would be greatly appreciated. Thanks!
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