Line of credit ?

[Benjamin Haberman]

Hello BP,

Just found out I have access to a $50,000 line of credit at 7% interest. I'm pretty sure that is a pretty solid rate. If you know of anyone else with better rates, please let me know.

I've been thinking about something lately. For someone with out the cash on hand to be able to put 20% down on rental properties, I've been thinking lately to do some flipping/developing first with the line of credit to build that cash to put down on these  rental properties in the future. I own two now, but one was my first primary and the other was owner financing. I'm pretty sure i'm correct in saying that using a line of credit for a buy/hold property doesnt really make too much sense unless the profit far exceeds the interest payment on the loan and you can pay down the principal fast. 

So im going to write a plan this week to do some developing with cheap lots/modular homes to build the "cash on hand".

Thoughts?