I know this is a hot topic for a lot of people starting out, or wanting to get credit to extend their ability to purchase, so I will just share briefly what we did.
I went to a local bank. It should be noted it was a local bank as they are easier to work with. I did this right after my first flip and I brought a small business plan, including details of my first flip. It was only like 5 or 6 pages so it could be read quickly and one of the pages was projections and graphs, and there were a couple pics of my first flip so not really even 5 or 6.
If you are interested in it, I might even be able to find it. Drop me a line.
I explained all the mechanics like I had done it many times before. I also hinted that the way things had been going I might never even need the money, or would only need it short term because of how I was buying and able to sell before I actually bought. I also mentioned that if I did keep a property, I would use their residential mortgage department to roll the property into a mortgage and payoff the credit line.
I was asked how many houses I had and how long I had been doing it to which I basically responded that we had just moved here, which was true, and were getting used to the market, but that I had dabbled, however, as my business plan reflected I wanted to buy a lot more, I would be buying at better then 80% and that it would be very low risk as I had outlined.
I worked with them and to start, I had to open the line with a house purchase and get an appraisal per house and buy at better then 80%. At some point I think I will just be able to do what I want with it as I continue to payoff the line each time and show there is no risk. I don;t know, but the way it works now sems fine.
Purchase the house your credit line, or however you can, then roll it into a mortgage. If you buy right, a mortgage should be no problem after purchase because of the 20% or more equity you have in the house.
Chris
 |
|
Tags:
|
|
05:00:00
