Posted by Helen Thomas on January 16, 2002 at 10:46:09:
This is my first time so please bear with my ignorance. My husband and I have just bought a property for 529,000.00. It is three acres with a house, including a concrete dairy with electricity and plumbing. It has one acre independently zoned with a separate address. The bank would not loan us two separate loans so the buyer sold the independent parcel for one dollar. I know that sounds wierd but it is true. We are two professionals. He is a lawyer and I am a Chiropractor and we have estimated incomes of a 80,000.00 each after taxes. We have back taxes but are paying them back and it does not appear on our credit rating. We are discussing the idea of selling off the parcel for 200,000.00 which is what comparable properties in the neighborhood go for. We also are thinking about the idea of converting the dairy into rentals. So , instead of selling property we were thinking that making improvementss on the land would increase our equity to the point that we could be eligible for 350,000.00 in equity once the apartments are complete and the extra land is perc and water is completed. We have been told water is not a problem becasue we have a well that puts out 11 gallons per minute. Septic is a question but not an impossibility.My questin is : Are we thinking in right direction? Are equity loans feasible in a project like this? Have I given you enough information? We then would take the 350,000.009(increase in appraisal value) and buy a positive cash flow apartment building? Please advise.
Thank-you,
Helen Thomas