Titling your vehicle(s) for downpayment/rehab

[Omar Grant]

Thoughts and advice on using an auto title loan company as a source for quick cash to use as a downpayment or rehabbing a property. I own both of my cars outright. They are worth about 30k+ total. Just starting out and trying to identify sources of funds that I have access to. This is one I heard of in video blog and looking to get some feedback from others.

Thanks!

[Adam Johnson]

You are on the right track and thinking creatively.  One obstacle that will help if you can overcome it is resistance to debt.  There is a difference between GOOD debt and BAD debt.  If I can borrow money at 10% and use the same money to make anything more than 10% (hopefully much more), then I consider that good debt because the return on debt is greater than the actual cost of the debt.

Regarding the use of auto's and other creative leverage, I have done that and it worked well.  The way I used it, and I'm not sure if this was your plan, was I went into my credit union that I have a relationship with.  I simply said I own "x" vehicle free and clear, can I take a loan out against it?  Three days later, I stopped back, picked up the check for $ 10,000, and used it as a deposit on a piece of rental real estate.  I bought the property right, fixed the right things, and created $ 25,000 worth of equity AND the income from the property carried the cost of the auto loan as well as the hard money loan that I paired it with until I was able to refinance the property and pay off the hard money loan AND "reliquify" the money from the auto loan to roll into another rental property and do the same thing all over again.

I owe a lot of people a lot of money and I have no reservations about it.  However, that money (debt) makes me more than it costs me, so I sleep well at night.