Ample Liquidity, Good Credit, Good Banking Relationship
For someone with cash to spend, good credit, and existing relationships with local banks, what is the best method for buying some of these foreclosure and REO properties?
I assume: 1. buy outright with cash
2. renovate
3.lease up
4. get perm financing from a bank to pay back out of pocket expenses.
This would be done as an LLC.
Is my assumption the best method? Most posts that I read are folks trying to buy with little cash down, and using freddie mac for the end loan, which is a different ball of wax.
Any words of wisdom?
#1, # 2,and #3 can be done all day long and as often as it takes for you to run out of cash.
Unless your LLC has assets, income, and at least a two year credit history, forget #4.
Yes, it is that bad out there as far as financing your investments.
My last line of credit on a paid-for commercial property came in at 50% Loan-to-value. And that LTV was based on a very conservative appraisal.
Good Luck.
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