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timmym22

what would you do with this.....????

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I just bought a primary residence with cash. I am now

pulling out a HELOC against the property. I will have

about

80k to work with. I am trying to decide how to use this

line

of credit. Here are my ideas:

1. Buy 3 Land/home deals at 25k each and rent them

2. Buy one REO and flip it, (Yes people are still

flipping

in this market, I see it all the time on th MLS)

3. Buy two stick built homes and either owner finance

them

or rent them

 

If i buy the l/h deals i will have better cash flow,

but not

much of a chance to sell them in the near future for a

profit.

If i buy the stick built homes i have a better chance

of

getting cashed out in the near future

 

share your ideas on what you would do

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I just bought a primary residence with cash. I am now

pulling out a HELOC against the property. I will have

about

80k to work with. I am trying to decide how to use this

line

of credit. Here are my ideas:

1. Buy 3 Land/home deals at 25k each and rent them

2. Buy one REO and flip it, (Yes people are still

flipping

in this market, I see it all the time on th MLS)

3. Buy two stick built homes and either owner finance

them

or rent them

 

If i buy the l/h deals i will have better cash flow,

but not

much of a chance to sell them in the near future for a

profit.

If i buy the stick built homes i have a better chance

of

getting cashed out in the near future

 

share your ideas on what you would do

 

 

Hey Timmy, just my 2 cents, but I would buy a couple REO properties that are in good shape and obviously cashflow and lease option them. You get the cashflow and possible capital gain on the back end. Of course, make sure you have the equity in place to sell for profit before you buy. I think the lease option might be a better alternative to the owner finance, because you avoid the foreclosure process if the stuff hits the fan and you need them out. Easier to evict than foreclose. Hope this helps, there are lots of great experienced investors on this board to help you.

 

Take care,

Nate

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Many may disagree, but I am not a big fan of going into big debt to invest. Your primary residence is free and clear! Not many can say that, and now you want to put your primary residence and credit at risk? This is old school thinking and the whole economic and real estate problems today are the result.

 

I think there are better ways to raise cash to invest with a lot less risk, no debt, and greater reward long term. L/Os are a great way to get the cash you need, and then invest in a real estate venture.

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I am with Steve on this. The only thing that I would use the money for is marketing. Keep your HOME FREE and CLEAR. With the downturn of this market. One bad move can move you out. One of the best decisions I made was to pay off my home when the market we going NUTS. I made a vow to my wife to never borrow against the HOME. If my ship goes down. I have a place to live. Some think I was nuts at the time. But, I look around my neighborhood, and see REO's and Default.

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80k could buy a LOT of marketing....

 

But you could probably make a ton of money with a fraction of that amount put towards marketing ;-)

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