timmym22 0 Report post Posted November 30, 2010 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 them2. 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 Share this post Link to post Share on other sites
gthinvest 0 Report post Posted November 30, 2010 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 them2. 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 Share this post Link to post Share on other sites
<Steve> 82 Report post Posted November 30, 2010 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. Share this post Link to post Share on other sites
Jonathan RexfordFL 8 Report post Posted November 30, 2010 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. Share this post Link to post Share on other sites
MichaelC 160 Report post Posted November 30, 2010 Timmy, put me in the fiscal conservative column. Keep your primary residence debt free and sleep sound at night. Share this post Link to post Share on other sites
speedingpenguin 19 Report post Posted December 1, 2010 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 ;-) Share this post Link to post Share on other sites