Posted by John Corey on April 06, 2006 at 20:37:42:
From what you said the deal could be a good one. You really did not say enough to provide an unqualified answer. Better than saying twice the equity would be a discussion with some specific numbers.
Also understand that what is a good deal for one person is not even reason to get out of bed for someone else. One investor I spoke with expect $100K profit per transaction. He is in a high priced area. Another investor is very happy making $20K per transaction.
If you use HM then assume you need good cash flow to cover the monthly or a loan that has no payments until you pay it off. As the rates and points are higher you are trading some equity to get the deal done. If you can not do the deal any other way then HM is cheap compared to leaving a good deal on the table.