Newbie
Greetings,
I am a newbie in Real Estate investing. I am really interested. I have my own house now with about $120,000 in equity. I took out a $50,000 HELOC which will pay off my second, two credit cards, and give me some extra cash. The HELOC is at 4.75% for 10 years as an ARM. I want to use some of the money for cash down on a second income property. I have had one lender tell me that I need a purchase agreement first to proceed. They had a great deal for me of 100% financing, low 5% interest, $3300.00 closing cost which I would like to see if I can get the seller to pay. How practicul is having a purchase agreement compared to a pre qualified lender? My main question is, I need some tips on making sure I do this right. Most lenders seem to state I am going to go into a rental with negative cash flow because of the prices in California. I want to stay around $250,000 which keeps things somewhat affordable. What is the best way for me to calculate a house that I would be interested in to see how cash flow will be? How beneficial is a negative cash flow for tax right off? If at all. Looking forward to any suggestions. Thank you in advance. I can only get to the internet certain times per day but will check forum ofter.
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