All Forum Posts by: Ben Johnson

Quote from @Derrick E.:

To answer one of your questions, I doubt you will ever find someone willing to give a loan in 2nd position on an investment property. 

The obvious answer here is to somehow get some income and start paying down the credit card debt. 

Best of luck. 

Thank you for weighing in.  Kind of figured that the loan side would be a long shot.  

And yes, definitely working to solve the income side as well along side this.   

Quote from @Theresa Harris:

Can you move into one of the rentals and then sell it in 2 years?  $300K is a lot of credit card debt and probably didn't happen overnight (unless it is medical bills).  I'd start by looking at where the money is going and how to increase your income and lower your spending.  You can give notice to one of the tenants, then move in and rent out rooms to further cut your living expenses.

Yes, something I've considered but does require me to move from CA to TN, so big life change.  Also with the CC snowballing, I won't be able to make it two years without some other sort of intervention.  This is a good note though, and something as a piece of the corrective measure.  Thank you for weighing in. 

Quote from @Jay Hurst:

why would a tax bill wipe out your equity at 60% loan to value?

I'm a CA resident, so gains would be taxed as ordinary income. I have 

$150k cost basis

$700k sale price ($420k to loan, $280k equity)

$550 Cap gains

20% Federal $110k
11.3% CA $62k

Total Tax $172k - Granted not everything, but a very expensive route to take.  

I'm a struggling startup owner that has accumulated 300k in credit card debt at an average APR of 21%. I have two rental properties, both around 60% LTV. Values are $700k and $265k. Both occupied and cash flowing. FICO is 630.

I have very little income, and my debt has grown to be overbearing.  Looking for a way to right the ship without a catastrophic credit event.  I've explored refi and heloc, but came up empty as I have no chance of qualifying income.  

Does anyone know of a lender that will do some sort of a 2nd position loan based on rental income alone for qualification?

I'm at the point of considering an HEA or HEI, which will provide some short term relief, but pretty costly and only enough to wipe out about 1/3 of the credit card debt.  

Selling one of the properties is not an option because they were both purchased via 1031 funds from dramatically appreciated assets creating a cost basis of next to nothing on these.  Tax bill would wipe out most of my equity in the sale of either property. 

Any help greatly appreciated!!