Posted by jeff on September 12, 2003 at 09:02:05:
I didnt have my house paid for and used a line of credit to purchase rentals. After a year I got a line of credit on a rental and purchased a few more. Your question depends on your goals. Buy and hold? Flip? Rehab? I like buy and hold to build net worth and cash flow. It also creates leverage to purchase other property. But… a lot of people dont like being a landlord. Others like the quick turnaround of flips and rehabs. The quicker money returns. But… Taxes, and the longer the property sits on the market the less money you make. If you have a large line of credit maybe you could try both styles and see which is best for you. You could even buy a rehab with your line of credit (save closing cost) fix it and refinance to recover your money, (maybe even pocket some) and rent it out for cash flow. Single family homes should rent fairly well in most markets. The rates are moving up slowly, but are still real good. There are some good options for investor loans if you have credit. Good Luck.
Jeff