Using Home Equity for Real Estate Investment
I need advice on my current real estate situation. My mother gave me a house she bought in 2010, and its value has increased significantly since then. My real estate attorney advised against putting my name on the title due to tax implications. I want to use the equity from the house to buy more real estate, but most lenders require my name to be on the title to prove ownership. Additionally, my debt-to-income ratio is high. Should I consider taking equity out of the house to invest in more real estate, or are there lenders who can work with my situation?
Most Popular Reply
To answer the initial question - I would say NO. Reason why is you are basically getting 100% financing on a property and using the other as leverage. You would need to put the home in oyur name which could have tax consequences then you are getting a loan to buy an asset which most likely will not cash flow. Unless you have considerable cash as well to put down on a home I would say not to do it.
- Chris Seveney
