First House Question
I've been reading the boards for a while now and being doing some reseach into the industry. I found a house that looks like it could be a good hold/rent house and I wanted to put the scenario out there and see what people think I should do.
4/2 right behind a college. The listing says the seller is motivated and will take a second. Asking price is 59900 which looks like its close to FMV and the rental income should be close to 1000 (I was thinking of renting it to college students who would split the rent.)
Now I have very little cash reserves so is there anyway to work the deal so I can get money out of it to keep in case of emergency repairs. I was thinking if I could get the owner down 5K and have him take a 2nd for 10% of FMV. Then try to get a mortgage for the FMV. I should be able to get about 10K out.
Any suggestiong?
I'm no genius on this but I would say that before you try and invest in something that would generate some passive income you should build some money for such investments. Why? Because you never know what you will be getting in to. What if you can't find renters? What if the place is out of code and needs repair? What if you forgot to figure in taxes or they increase suddenly? Yeah, lots of what ifs, but nothing that a little cash can't turn into good investments. If you enter with an exit strategy to turn the house around you will be less likely to succumb to such pitfalls... Thus, my 2 cents once again, is to build equity or cash before investing in a buy and hold property... Perhapse this house would be good for such a deal.