Equity available from condo conversion, is it safe to lent privately?

[Joel]

Hi all,



We have done a condo conversion on a 6 Plex (undivided co - ops), we sold 4 units and 2 of them are still occupied by tenants unwilling to leave.



The amount of mortgage we are able to keep to be covered by the rents we receive from the tenants is $150,000.



However the bank was willing to let us keep $280,000, but we need to cover the mortgage payments from somewhere, now the question is would it be a good idea to lend the money privately for 12-14%?



Or to invest it in a rental property?



We have a rate of 3.5 Capital and Interest.

 

[Thomas Beyer]

Your question is confusing.



Of course it is a good idea to lend money at 12-14% provided you can actually get the money back (which is often quite hard in an asset that can actually pay 12-14%).



Yes, investing in a rental property is a good idea, too, provided it is in an economically strong region where rents and vacancies will not drop and where you can comfortably make your monthly mortgage payments after all operating expenses are paid.