using equity to purchase additional property - Posted by Rebecca

Posted by Ed Garcia on June 28, 2001 at 09:35:24:

Rebecca,

You don’t tell us where you’re located. Anything is possible. It’s a matter of finding a motivated seller and structuring a deal. When you say that you currently have about $35,000 in equity, we don’t know for sure if that is lendable equity, there is a difference.

Example:

House is valued at $100,000, borrower owes $70,000, borrower has $30,000 equity. Not necessarily so. Lender may only lend 80% LTV to that borrower on a CASH OUT.

Example:

House is valued at $100,000, borrower owes $70,000, lender lends 80% of the $100,000 which is $80,000 minus $70,000 owed, borrower has only $10,000 available new cash.

Rebecca, there are many things you can do, but I need more info to advise you. I’ll give you some hypothetical examples since I don’t have enough information.

  1. Borrow the down from your existing house.
  2. You and your dad buy the new house as partners, you being the owner occupied
  3. Have your dad buy your other house, and then sell it back to you at a later date so that you can go owner occupied on the new home, and perhaps get 100% financing
  4. Get the seller to carry back the down, etc.

Rebecca, there are so many more available ways a deal can be done, I’m just giving you some food for thought to get you thinking.

Ed Garcia

using equity to purchase additional property - Posted by Rebecca

Posted by Rebecca on June 28, 2001 at 08:16:30:

Hi everyone - I currently have about $35,000 equity in my home and would like to use it to purchase a new home and rent this one. My credit rating is good but I am working a temporary job this summer that doesn’t pay great and plan to get a better job in the fall. My father has excellent credit and a lot of money in investments and would help me get a loan but I don’t want him to have to provide any cash. Any advice on how I could both get and use my equity? Thanks!