I am working through a deal right now that involves two duplexes. This is my first deal, and I have never done a loan before so I would like some advice on what options I have and which route I should take. I have about $35,000 of savings and another $150,000 I can borrow from family for 6-12mo.

One duplex is fully occupied and appears to be renting well below market rent (still waiting on lease for confirmation). I plan on financing this duplex as a 30-year fixed investment loan with 20% down interest rate should be around 5-5.25%.

With the second duplex, there is significant amount of fire damage. I am planning on living in this duplex which means I could either do a 203k FHA loan, or a Homestyle renovation loan. However, I also have the option of paying for this duplex in cash, rehabbing, and then doing a cash-out refinance.

With all of this being my first deal, I am having a difficult time finding the right people to talk to about this. I like the idea of purchasing the fire damaged house with cash, but I'm not sure if it would be the best option for my situation. I'm having trouble gauging how motivated the seller is, and I'm not sure what circumstances they are in. It is possible they would find the cash offer very appealing which I would of course offer at a lower price than the Homestyle or 203K option.

Just wondering what your all's thoughts are on the subject, and if there are any other routes I could go with this. I have an excellent credit score and a strong source of income. being that I have not made any loans, I don't have any debt/income ratios to worry about either.

Thanks

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Buy a fire damaged house with cash or finance?

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