How to avoid leaving your own money in a deal when financing??

[David Kerner]

Hello BP,

Im trying to buy and hold a new property each month using financing. However most banks will only loan 75% LTV and its very difficult to find homes in this current market that are below 90% LTV which would mean I would have to leave at least 15% of my own money in each deal. Eventually I would run out of money and wouldn't be able to buy anymore

When owner financing is not an option...

Can anybody advise me on a strategy or work around so that I cant keep the wheels moving and buy every month.

Thank you for your help

[George Krajacic]

Hi David, I congratulate you on your goals. If you are dealing with banks or PMLs I can’t think of the way to reduce your down payment. However there is the way to pull part or all the capital out upon refinancing. To achieve that one has to increase value of the properties by buying heavy fixers or the properties that one can increase value of by adding extra bedroom or bathroom or both. If it is done right, in the right neighborhood, one should be able to refinance and reduce your capital locked in the property. No free lunch! You want to pull your money out you have to work for it by increasing value of the property so that lender sill has its protection.

Good luck,

George