different types of loans?

[Pearl He]

Hi everybody, I have some cash saved to do an investment, but I would like to take out more loans to purchase more expensive properties if possible, or at least to keep my options open.  I would like to see what different types of loans are available for investors, and the pros and cons for them.  Thank you!

[Manolo D.]

Originally posted by @Pearl He:

Thank you all for your quick and informational posts!  So here is a little about my situation. I currently own 2 houses, and have about $150K saved in cash.  My loan agent told me that based on my family's income, we now only have the capability to get another conventional loan in the amount of 200-250K.  I live in Los Angeles, and was thinking about purchasing an investment property in the area to rent it out, while waiting for appreciation.  But looking at the current market near LA, the money I have won't get me a decent property.  

I recently have been thinking about investing in Las Vegas, NV instead.  It seems that Summerlin and Henderson still have growth, but most houses in the good neighborhood of Henderson are already priced high.  Summerlin however does seem like a good place.  I saw some houses ranging between 150K to 350K.  I have been trying to decide whether to buy a property in Summerlin for about 250K, or to purchase lower priced property in not as good neighborhood.  My concern on buying property in Summerlin is whether it will be difficult to rent it out later.  I have heard some horrible stories about rentals in Vegas. However, I would not want to carry the mortgage on my own. 

I would love to be able to start investing, but I am not sure how everybody is doing it.  It seems to me that if I were to acquire another property and rent it out, my money is locked again, which means I won't be able to continuously acquire new properties.  Am I missing something here?  I see people that have so many properties, but is that all from flipping houses?

Thank you!!

 You could do a lot with 150k from a hard money lender, but you are more likely to do a flip until you get to around 300k and purchase something in LA area so you don't have to worry about anything out of state. It might take 3-4 flips and o get that other 150k and probably in 2-3 years but it's well worth the effort.

Your other option is, turn-key rentals from a more farther area in FL or TX or Kansas City.

Your third option is to check whether a cash out refi on your other 2 houses will gather you enough cash to qualify for another, if you go with 70% equity on all properties, it could be a good chunk, highly unlikely but it still is an option. Considering that you have an agent, most likely you already told him about the 2 houses and he already considered those plus your cash. 

I am not sure why you only qualify for only 200k if you have 150k cash, it means they only want to lend 50k? if you go multi family like a 5 or 6 unit condo, and rely on income of the property, it might he a different story.