Financial advice concerning newly acquired rental properties.

Hello I'm new to the group and new to the investment property world. I have a question about an opportunity that has come to me. I recently inherited 2 rental properties that are paid in full and currently have tenants living in them. Both properties need work done (about $3,000-$4,000 altogether). My credit score isn't the best right now, but I don't have much debt right now either. I was thinking about tapping into the equity in both properties to do some upgrades and repairs, and possibly investing in an additional rental property however I spoke with someone that said I may have a hard time since my score isn't the best. I also thought about trying a hard money lender. Just kind of wanted to get some ideas about how I could solve my cashflow problem.

Comments

  • Posts: 0
    I would first start by talking to a few banks and seeing if you can qualify with them, at least take that guesswork out. In terms of pulling out equity for the repairs, will it help increase the value or rent of the properties? I would caution about spending money on something that really won't improve its value, although it would most likely help to keep them in shape for the long term.

    I think it would be a good idea to use the equity to purchase another rental. Hard money lender may be an option, but usually those come with a high interest rate and in my experience a lot of them would like to see you have some experience in the field before lending the money. I would start by just calling all of the banks in the area and see what you can find. It took me about 6 or 7 different bank calls until I found one that will lend to an LLC for a single family home, with a loan as small at 20k.
  • I would agree the first step is to talk to a lender to see what your options are. 
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  • A lender can actually be a great help in impriving credit scores. 
    Creator of Invest Four More
    If you want more help with your investing, check out http://investfourmore.com/blueprint-for-successful-real-estate-investing/


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