Home equity loan for rental acquisition?

[Jacob Badger]

Hello everybody, this is first post on a BP forum. I have been buying and selling real estate for the last 8 years. With my primary focus being on the two year primary residence side of things. My wife and I recently sold our last primary residence and paid cash for our current primary residence and paid off all remaining debt and are currently debt free. At the time I thought this was the correct line of thinking and a good choice however now I'm second guessing my choice. I'm in a slight pickle and seeking advice. I am wanting to get into the multi family scene and have read a pile of real estate books and have been listening to the BP podcast for the last 4 months. I have been analyzing deals and occasionally coming up with some properties with 15% plus ROI's in my area. However most of these properties are in the 300k plus range and the down payments would be fairly substantial due to the fact we just depleted most of our liquid capital becoming debt free. My question is ,and I've been struggling internally with this, should I pull the equity out of my primary residence to pay cash for a multi family or, pull equity for 20% down on the rental ,or just hold off all together approximately 1 year until I have the cash to pay for the 20 % down. I'm not very keen on the idea of using other peoples money on my first multi family deal and I'm not sure if I'm missing any options that I'm just unaware of. Thank you so much, I'm a rookie in this environment and I'm positive that some of you are experts on the subject at hand.