First let me begin by saying this is a great site. I have for many years participated in an aquarium forum where I learned to be successful in that hobby (i know completely unrelated).
I have no doubt that I will gain the same level of knowledge and respect for this site as I have on that one.
With that being said, I am doing my do diligence on learning as much as I could about real estate investing. I have sub scribed to the podcasts which listen to everyday in the morning before work and in the evening after work (catching up). I also do what I can in reading through the posts for anything relevant (that would be everything).
So I have a pretty good knowledge on rehab as I have done two complete rehabs on foreclosures that I used as my primary residence. I have an MBA with a strong background in finance. I am not saying that this alone will make me successful but I do think it gives me an advantage.
Sorry for the long winded introduction. What I wanted to ask was the following:
I have very little money to put down on a first investment property. The niche that I think I want to focus on are small multi family units. If I read correctly, I could possibly use the equity in my home and receive a line of credit. Is this a smart way to go?
Also, where I am stuck is the fact that if I use that money to purchase an income property, how would I finance the others that I would like to do in the upcoming months? I am confused with this part.
Thank you for any guidance you could provide. I look forward to the responses.
@William Manzie welcome to BP.
To answer your questions, a HELOC or 2nd mortgage might be the right way to go to get into your first multi-unit property. If you do that you will want to make sure you can pay your mortgage on the property as well as your HELOC with 60% of the rent money or less so that you don't create a alligator that eats you alive. This will let you factor 40% of the rent for maintenance, management, etc, etc, etc.
Other ways to get into a property are to joint venture with others, find a property with seller carry back or seller financing. Still another way is to sell your home and buy a multi-unit property that you can live in and rent out other units which is referred to here on the site as rent hacking. Those are just some thoughts on this and if you research these you will find a whole lot more on the forums. Best of luck.
Also, get a photo up on your profile. It goes a long way with BP members so they will connecting with you.
Thank you for your quick response Bruce.
I will definitely keep my eyes open for a property that will not cause me to fail.
How do people continue growing if your money is held into a property?
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