Cash on hand needed to close on investment property?

Hey guys,

I am buying a property at 60% of ARV. It needs minor repairs, mainly paint and carpet. I usually buy sub2 and this is the first property I buy conventionally aside from my residence.

Now since I have to come up with 10% down plus closing costs I was going to use my Line of Credit. My mortgage broker told me however, the underwriter will want the funds borrowed to be secured and line of credit would not work.

An alternative was to sell my car rather than trade it in and buy new car on finance then use the money from selling my car towards the downpayment but my mortgage broker again said this may not work.

My mid credit score is 761, I am going full doc, and my yearly income is much more than the price of the house to begin with.

Other than going after private money, how can I make this work?

Your broker is mistaken. All that needs to happen is that the new debt needs to be factored in to your DTI. Meaning that since you are borrowing the money from your equity line, your payment is going to increase. Whatever the new payment is has to be figured into your debt. It should be very simple.

Thats what I thought too, thanks for the explanation. If she cannot get it done, I will get a new mortgage broker.

Words to live by, nothing more annoying than a paid professional that can’t get the job done. Good Luck

I’d replace her now, she obviously is clueless.

Yeah I am planning on doing it tomorrow… here are the requirements she has:

  1. $4,000 in holding costs in my bank account or ability to borrow against my 401k
  2. 10% down payment (expected)
  3. Copy of car title, bill of sale, and proof of deposite
  4. $14,200 to be in my account to purchase $62k home (not sure yet if she included the $4k holding costs or thats extra)

I will call a private lender tomorrow as well as another mortgage broker. She wasted too much of my contract’s time and I need to move quick.

can you take the property subject to and then refi it with the low LTV? Get the title in your hands man, then refi it. Your mortgage broker shouldn’t have a problem with a 60 LTV refi, if she does she’s a newb.

Yeah sub2 is not an option in this case. The seller owes 30k on it, and wants to sell to buy/build a home out of town.

got it. well I would find a new broker.

I just got a 95% NOO loan plus closing costs on $85,000 from Coldwell Banker. Brought $5,300 to closing. Had $9,000 in savings and that was enough for them. 700 FICO and full Doc. They are our there, I try to get 3 quotes from different lenders everytime.

When you say “just got” when exactly was that because I contacted Coldwell Banker and they were unaware of such a program. They quoted me a 90% program.

I PM’d the info to you.

Thank you for the info. I left them a message. I want to find out if they offer that product through wholesale channels.

They did a great job for me. Ultra fast for a conventional.


Keep us updated on that 95% loan. There were some 95% loans up till about 3-4 weeks ago. Chase and Heartland both had this.

We just got a new lenders list and several lenders popped up that may offer this.

Not that this is the case, but sometimes a broker can slip one past a borrower or lender by doing a loan as a 2nd home or primary. I’ve looked at people’s applications before and showed them clearly why they got the type of loan or rate they did.

“slipping one past”…calling it primary for NOO???

Is it just me or is that mortgage fraud.


Ben is not suggesting you do that, he is only saying that it happens. I had a customer last year that I worked at getting qualified for a jumbo spec home. While I was working on it he all of the sudden said “I found another lender and he already has me approved and ready to close”. Come to find out that broker just switched it from investment to second home and viola approved.

Exactly, that’s what I was implying is that it happens; not advising that in any way as it would be mortgage fraud.

Borrowers need to understand the loan application process because it seems that many dont even realize what they’re signing.

I just got off the phone with Coldwell banker and they informed me that the 95% NOO loan is no longer available. 90% NOO is as high as they will go. My loan was in process as they were changing the guidelines.

Sorry for getting anyones hopes up. I just found out this afternoon.


You can use your line of credit for the down payment or a VOD alsol.

I am new to this site and did not know I couldn’t provide my email in a message sent to you yesterday. My message was removed because of that.