Using Credit Card Debt To Invest

[Saul Moreno]

Hello BP!

I recently heard in a seminar and podcast that you can use credit card debt for a down payment on investment properties. Has anyone heard of this strategy or any other strategy where you can use your credit card debt to help with investing. Also, what is the be way of using this strategy? For example, should I use 20% for the down payment on my credit card and the other 80% from a private investor? Is using credit card debt a bad idea? Thanks in advance for any insight!  

[Linda S.]

@Saul Moreno,

We use credit cards, and it can be done-- but it's not for 99% of people.   I would not recommend it, as most  people aren't disciplined enough. 

To use a CC to help fund it, they are talking about doing a Balance Transfer, which is normally 0% interest  for 1 yr, with a 3-5% immediate fee.   Cash advanced would just be idiotic!!  Or if you just fund renovation costs,  you can do this, if you have an exit strategy!    If you put it on your CC, you better have immediate plans of refinancing and getting it cleared quickly.     The exit strategy is crucial!!!    Also, you need to be able to stomach your FICO score roller coaster, it won't be pretty!