Next Deal Financing Advice

[Jeff Solberg]

I just bought my first rental property and I am already looking for my next one. There are so many opportunities right now I am just very excited to get into the next one.

I need to come up with the 20% down payment + I need to pay for rehab and closing. I could wait until next summer to have funds saved up again but I am wondering peoples thoughts on borrowing from my 401k and then pay it back next summer? All the numbers look good (using the 50% rule) even with the 401k loan and conventional loan payments.

Also, another option is my family. They have money in CDs and earn basically nothing. I asked them about their thoughts on loaning me the money instead, for more interest, and they are all for it. Their loans would be backed by my 401k if necessary. What kind of documents to do I need to write up if I went this route?

Or do you think I should just relax and save up the funds then buy?

Thanks in advance :)