Creative Financing Alberta

[Steven Gingerich]

Hey Guys.

Interesting situation here, starting to snowball with property. Thoughts comments, advice are all appreciated.

Bought my first single family at 18 for$69k and 5% down with CMHC insurance.

A year later, bought the second cosmetically distressed single family for 5% down with Genworth for $75k. I fixed it up, lived in/rented it for a year and sold for $110k.

With the proceeds, paid off an apprenticeship student loan, a quad loan, AND bought an Up/Down duplex for $235k, AGAIN, 5% down with Genworth Mtg. Ins.

4 years after buying my first property I have just sold a tent trailer, with the $5,000 non taxable income, I paid down the first mtg. To a point where I own more than 20%, intentionally doing so to reappraise the property and take out the available HELOC from forced appreciation.

With this new $5163 HELOC and an existing LOC for $20k I have an accepted offer on a foreclosed 2bed Condo rebuilt in 2013 that was valued by CMHC at $157,000. The accepted offer is for $94k. I plan to reappraise the property immediately after the purchase and buy a fourplex that I already have lined up for $225,000. The condo itself cash flows $225/mo.

This would take me from 3 to 8 units in a matter of weeks/months using none of my own money and without private investors or hard money lenders.

The cashflow on the fourplex will be enough to cover the Line Of Credit payments and then some.

I don't have any vehicle or toy payments so I will be putting $1000 personal cash to paying down the LOC's faster.

After around 1.5 years the LOC's will be at zero and ready to spend again, I'm thinking a 6plex will then be the next step.

What are your thoughts or experience with this strategy in Canada?