In terms of single family homes for rental props, should I stay away from these homes where the owner finances?
I have seen a decent number in an area where you can just walk in. I would assume that I am paying fmv, but since it would be a rental to hold on to for many years, that might not be big issue.
I am just trying to figure out how to obtain more than one 85-120k home with the 20-25k in cash that I am going to invest.
Since I can do only stated income, no docs (IE IRS crap), I assume I am in the 20% down or so category.
I really want to start with two rental props in Houston.
Owner financing may be the way to go. There is one fellow there that has 100’s of properties for sell with 10% down or even less and he is owner financing. He is even leaving some meat on the bone so to speak. You could buy several deals from him and make some good cash flow as well.
You can also use hard money lenders to buy and fix up and then refinance and perhaps pull out your investment and do it again and again.
Your way of buying and putting down 20% and that being it is the last thing I would do. There are sub2 deals you can do with maybe just a few grand down and many other ways to buy 10 or 12 properties and even more with $25,000. A while back I bought over 40 some properties with zero nest egg like you have. I borrowed some of the down from other investors and bought sub2 and any way but getting a new loan and putting down 20%.
My 20% down thing is because for my loan I:
- do stated income only
- show NO IRS information
- am self employed.
All the props I am interested in run 85-100k. None are rehabs or anything. Maybe later when I have some cash flow I will try those.