To buy a Multifamily or Wait?

[sgtones]

We have about 50k of equity we can use from our current home. I really want to invest in a multifamily in Western Massachusetts. I am afraid that if I use up all my equity and if we want to sell our home in a year or two, we will have no equity to put down on our next and ideally final home.
Is there 100% financing out there any more? What should I do? I am 32 and now is a great time to buy. Advice is greatly appreciated.

[carlam]

Why a multi family in W MA? Are rental properties in short demand? If you found one, would the mortgage you pay be covered by the rent you would be able to collect?

Here in FL a lot of investors found they could not "flip" their properties for more than what they paid, so then renting them was their next choice, which has created more properties for rent than renters. Then because they were investment properties, mortgages are higher than the rent they can collect and leaves out of pocket expenses still on the property owner.

Being a landlord is not always fun either. Do your homework. Just my two cents.

[RobM]

Multifamily can be good for both income or if you want to live in one side and rent the other for income to pay the mortgage. 100% financing is dfficult to get nowadays especially for a multifamily unless you can prove you are going to live in it...and even then, due to current issues, 100% is going to be hard. I would get a hold of a good agent and see if they have good contact with mortgage brokers...or go to your local bank and ask what programs they may have to suit your needs

[jcdykes]

Personally, I would try to find an investment that you didn't need to tap into your PERSONAL home's equity. That is your safety net. That is part of the problem the country is in with the foreclosures. They have no equity and no way out when they need to move. Also remember that if there are vacancies, which there will be, you will be paying for that out of your own pocket. Don't jepardize your families well being to make a couple extra dollars per month.

Good luck,
JCDykes Western PA's home buying solution

[steve111111]

What jcdykes wrote is (basically) true. It is better not to add into your personal equity.

This is more complicated but also solves the problem with the next house.

[FlipItBig]

Could you use a HML to purchase the property at a huge discount, rehab what needed to be rehabbed, and then re finance? I would think a conventional lender would be more apt to loan on a property that was actually making money instead of one that is in disrepair.