Where Do We Go From Here?
We just purchased our first two properties-
1 bdrm 1 bath 675 sq feet built 1960
2 bdrm 1 bath 1200 sq ft built 1940
for $94,000(total). they are insured(per insurance recommendation of rebuild costs) at $65,000. and $120,000 respectfully.
We purchased these for cash borrowed from husband's mom and dad, to do this they are listed on the title along with my husband and his sister.
Our credit is probably not so great right now because the last 6 months we have had late pays on credit cards due to the slow eco and sales in our business being way down.
Can we now use these homes as collateral to purchase other homes?
We also have a loan on our personal house value $225,000. we owe $30,000. and have always paid on time. we have approx.5yrs left on the loan.
thanks
Mal
Maleficent2,
What is the current appraised or fair market value of each of these homes? This answer will help us begin to give advice as to what you may be able to do.
Dave
[addsig]
Just my 2 cents - more experienced folks here can probably advise better
Do some cosmetic fixing up and any rehab necessary, get it appraised. Talk to the banks about taking out a mortgage on them. Use that to pay off the folks who loaned you the money initially. Rent the houses & use that to pay the mortgage. Use the left over to keep going
how much equity is in the houses...
better yet, how much money have you paid, to date, for the homes? down payment, and mortgage payments together?
usually u can get about 80% of the equity out of the home...
this is what i understand from the books i have read...
so dont go on my opinion...i jus give it, to see if someone corrects me or tells me im wrong...
but thats my understanding :-D
My opinion is to refi your 225k home at 80% and use that money to pay off your credit card debt and your folks. Take some time to enjoy your new acquisitions, and to get your tenants under control, situated or your rehab done (don't know your plans for the 1st 2). Gotta make sure that you maintain what you have before you go acquisition crazy.
Good Luck,
Shawn(OH)
thanks for the replys.
We have tired to refinance our home to do just that pay off the credit cards and be done with them. And this is when our credit was GREAT! It was a no go they said we had too much debt for our income. What a joke we were paying everything on time, never late. WE have been banking with that bank for over 7 years also, they hold our mortage.
As far as borrowing against the 2 new houses and paying off the folks that is out. Husband's family lives in UK and he has 4 siblings there 3 of which his folks don't want to know about these houses. He wants them for inhertiance for husband and his sister(she has never married and has emotional problems).
But being part owner of them can we use the rent as income to secure a refinace or loan to purchase more?
sorry so long.
Mal