Good or Bad idea to buy "bad" property just to have collateral?

[Rebecca Bryant]

I saw a property that is being sold for nearly nothing in the Cincinnati area. It is listed on Zillow at 6k but owner says in description that it is 3k. I looked on the auditors site and saw that the owner doesn't live in the state. The property would clearly need work and I just found it online so I haven't seen many pictures, just the outside. I mentioned this finding to my dad, he would invest on property with me but this is something I could do on my own since it is so low. Of course we know it's going to need tons of work if the goal is to flip. 

But with not having the best credit and not much of any purchasing history aside from a new car that I recently got, is it wise or foolish to purchase a property to be able to potentially get a loan for a better opportunity later on??

Thanks 

[Michael Lee]

Hello, Rebecca 

Just because the price for a property is super low doesn't automatically make it a good deal you always have to do your research and make sure the numbers work for you, if the numbers don't work then your stuck with a bad deal which would hinder your chances of getting a loan rather than help it. 

So find out everything you can about the property before such as liens, if you can get a look of the inside of the property, what it will be worth after you fix it up and how money is it going to take to fix it etc.