Current Events > IRL Infinite Money Glitch

(+) Yeah! (+)

Okay someone tell me why this wouldn't work. I'm no expert, and I know there is a hold up somewhere along the line just want someone to tell me where.

You own a home. Lets say it appraises at $250k and you still owe $100k. You have a friend that works in real estate appraising, and you're pretty handy.

Take out a Home Equity Loan or HELOC. Invest $50k in remodeling your house, do the work yourself to avoid labor costs. Working with your friend to get the most bang for your buck in terms of appraisal.

Now you've just raised the value of your home, by lets say $30k. Get it reappraised and now your home appraises for $280k. So you have more equity in your house, go to another bank and take out another Home Equity Loan or HELOC and use it to pay off the original loan + other smaller remodeling projects to keep increasing your home value for more equity to tap into. Lather -> Rinse -> Repeat.

What? You just said you went -50k to get a +30k. That's -20 net.

Taking out a loan to pay off the other loan will always have at least that much loan remaining.

you don't just get an appraiser friend, and you can't re-appraise a building every week, there is gonna be a minimum time like 6 months at least.

Plus any worthwhile remodeling is going to require documentation showing it was done by someone licensed to do that work.

Doe posted...

What? You just said you went -50k to get a +30k. That's -20 net.

Taking out a loan to pay off the other loan will always have at least that much loan remaining.

Starting out you have $150k of Equity in your house. So your second loan is 50K + X amount for other projects.

Robot2600 posted...

you don't just get an appraiser friend, and you can't re-appraise a building every week, there is gonna be a minimum time like 6 months at least.

But I have an appraiser friend and the time in between is for the remodeling.

Mormaurd posted...

Plus any worthwhile remodeling is going to require documentation showing it was done by someone licensed to do that work.

It needs to be up to code and pass inspection, but at least in my location you don't need a license to do the work. Just needs to pass the final inspection.

You can't infinitely remodel a home to increase its value. It's eventually going to top out relative to other homes in the neighborhood.

when i was a kid i found a candy machine that accepted arcade tokens as dollar coins, 4 tokens for a dollar got you 4 dollars worth of candy or change back. i made the poor mistake of telling a friend, and the dumbass went to the arcade to get a bag full of tokens and tried pumping the machine for all the money in it...

I feel like at some point in this plan you're just being a remodeler with more steps.

TheOtherMike posted...

You can't infinitely remodel a home to increase its value. It's eventually going to top out relative to other homes in the neighborhood.

yea for sure. the "infinite" thing was more of a meme, but the point is getting your home to its capped value if it is below that threshold

Math like this is what makes banks wet

this is why there used to be countless infomercials for get-rich-quick-through-realestate scams.

it didnt turn out so well >_>

TMOG posted...

Math like this is what makes banks wet

Yea I was looking into some more fine print and it looks like there is usually a large fee if you want to start another Home Equity Loan before your previous is finished. Probably differs from bank to bank

Hey I respect TC for running with a hypothetical, thats how great things happen.

Never give up TC!

Not a money glitch, but about 18 years ago, I found a loophole to earn unlimited credit at Blockbuster video, based on a promotional deal that was being tested in our area.

They were running a deal where they would buy any DVD from you (so long as it was in their system) for $8 store credit. Having worked there previously, I knew that they had previously owned DVDs for as low as $5. So I bought one of those, then returned it for $8. When I had enough to buy 2 at a time, I did that. And so on. Just using store credit to buy stuff, and then selling it for a larger amount of store credit.

I would alternate between like 5 Blockbusters in my area, and I kept a list of the movies that were under $8, so I would know what to look for quickly. I had a good thing going (my first purchase was a brand new Xbox), but I told a few friends about it. One of them abused it in one night, he and like 5-6 friends (as a big group) went from store to store, swapping like 20 movies at a time. They each made like $600 in store credit in one night followed by an immediate region wide corporate phone call the next morning, in which they immediately discontinued the promotion.

>Max out credit card
>use different credit card to pay first card's balance
>repeat to infinity

The Popo posted...

Not a money glitch, but about 18 years ago, I found a loophole to earn unlimited credit at Blockbuster video, based on a promotional deal that was being tested in our area.

They were running a deal where they would buy any DVD from you (so long as it was in their system) for $8 store credit. Having worked there previously, I knew that they had previously owned DVDs for as low as $5. So I bought one of those, then returned it for $8. When I had enough to buy 2 at a time, I did that. And so on. Just using store credit to buy stuff, and then selling it for a larger amount of store credit.

I would alternate between like 5 Blockbusters in my area, and I kept a list of the movies that were under $8, so I would know what to look for quickly. I had a good thing going (my first purchase was a brand new Xbox), but I told a few friends about it. One of them abused it in one night, he and like 5-6 friends (as a big group) went from store to store, swapping like 20 movies at a time. They each made like $600 in store credit in one night followed by an immediate region wide corporate phone call the next morning, in which they immediately discontinued the promotion.

yes I remember this.

i worked at GameStop as a teen years ago. We had a friend who worked at that new games department in blockbuster and we bought all .99 cent to $3 used games at game stop and flipped them at block buster.

we wound up with hundreds of dollars in credit cause we would trade in at blockbuster, get the bonus, buy newer titles used and then flip them at GameStop for even more credit because they had a promotion going at the time for trade 3 get an extra $10 or something to that effect.

we wiped out the store, they eventually stopped the promotion as you said. But not because of us cause our mutual friend was the manager there.

Use the equity to get another mortgage on a different house then you got two houses

chrono625 posted...

yes I remember this.

i worked at GameStop as a teen years ago. We had a friend who worked at that new games department in blockbuster and we bought all .99 cent to $3 used games at game stop and flipped them at block buster.

Yeah, it originally started with me and a friend (the same one who eventually overdid things) coming up with an idea to go to a Disc Replay, buy a bunch of 99 DVDs while on the phone with a friend who still worked at Blockbuster to determine which ones were still in the system, and then selling those.

This was technically how I got the Xbox. I spent about $30-40 on Disc Replay stuff and turned it into like $350 in Blockbuster credit (arbitrage!). It was actually while walking out with the Xbox that I realized I was going about it wrong, exchanging (small amounts of) cash for store credit, when I could just be exchanging store credit for more store credit.

I fail to see how improving your appraisal by 30K by using 50K loan increases your net worth.

Sorry but if you read the patch notes written by god, it got patched out.

This sounds like youre trying to do the BRRRR method without renting the property out and not really accumulating equity or net worth.

and this seems like a lot more effort than its worth for no gain.