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Author Topic: $ back at Closing, too good to be true?  (Read 3122 times)

Offline tierney211

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$ back at Closing, too good to be true?
« on: August 22, 2005, 05:15:50 pm »
Hello everyone,

If i were to find a property selling for 250,000 and the bank appraised it for 270,000....would I be able to get a convential loan on the 270 or 250.  I recently heard/read that the bank loans you what they appraise the property for, but it just seems too good to be true. Cause that means, in this example, I would get 20k in my pocket back at closing.

Someone please help.  Everyone has been great on this board and a thank everyone for their contributions, they are priceless to me!

Tim

Offline zachj

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Re:$ back at Closing, too good to be true?
« Reply #1 on: August 23, 2005, 02:01:14 am »
A conventional loan would be based on the lower of the appraised value and purchase price, so the $250k in this case.  

If you happen to be fixing up the property you can get a hard money loan for 80% future value.
Zachary Johnson
Commercial & Residential Loan Specialist
100% financing, Rehab Loans, Hard Money, Construction & Development Loans Internationally
Windsor Capital Mortgage Corp.
office: 619-822-2909 (SEE PROFILE FOR EMAIL ADDRESS), www.propertyloanrates.com

Offline Mdhaas

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Re:$ back at Closing, too good to be true?
« Reply #2 on: August 23, 2005, 07:41:20 am »
zachj is right.

Conforming lenders will only loan on the lowest figure of the two. The purchase price or the appraised price.  

The beauty of this loan scenario is of course the immediate equity that you have in the property.  

If your initial loan does not have a prepayment penalty, you could turn around and refinance it in a few months. (there are still lenders who do not have seasoning issues)
If at first you don't succeed.....................skydiving is not for you

Offline Lendinghand

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Re:$ back at Closing, too good to be true?
« Reply #3 on: August 24, 2005, 01:50:20 pm »
You can get cash back at closing if it is for sale by owner.
Jason Vogler
Realtor - Ex Loan Guru
314-566-0919 direct

Offline Chris2006

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Re:$ back at Closing, too good to be true?
« Reply #4 on: August 24, 2005, 02:24:21 pm »
Hello, I agree with Mdhaas and zachj. Traditional lending is always your first choice. HML your last choice. But, in your case, a HML would be a good start. Then, refi with a traditional lender later.
Chris

 




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