I'm looking at buying my second home in COLORADO. I'm thinking about renting my current home, getting an interest only loan on a 2nd home.Build up equity then sale it. Moving into the new home renting out my current home or vis versa . Fix up the newone if need be. Then flip it. I've heard I can create an LLC company to cover my rear. I was told if I create this business and go under (house that I purchase forecloses or I cant afford to pay it) I wont lose the house I already own/garnish wages. Can someone elaborate on this and also if anyone can inform me where to get started with creating my own business (Online and not through some program that cost more then the application itself. ) if not online other options are fine. In addition I would like to ask if ANYONE has ever tried this? Please, lay down some stumbling points I may overlook. After getting my LLC what is the next step to get everything done so I can concentrate on making money buy selling and buying houses?
2007-01-26 01:53:06 · 2 answers · asked by HipHop 24/7 1 in Business & Finance ➔ Renting & Real Estate
First of, you are NOT going to build any equity through any interest only loan since the pirncipal is not being paid down. Until the loan begins to amortize can you build any equity.
Second, an LLC will allow you seperate some of your assets from you, personally, in the event of any legal action. This can safeguard you primary residence BUT most lenders give recourse loans so that even if the primary borrower is the LLC, you are on the hook personally as a guarantor...so they can come after your personal assets.......
Third....this is the worst time to get financing for speculative deals.
2007-01-26 02:35:08 · answer #1 · answered by boston857 5 · 0⤊ 0⤋
Sent you an email.
2007-01-26 02:44:41 · answer #2 · answered by outwest 2 · 0⤊ 0⤋