As I read and try to figure out some creative financing. I would like to know in today’s market if a investor would present this.
background
- I’m looking to buy and hold
- Most of my deals will most likely come from my Realtor
- I have 5 properties and it’s been about 3 years since I last invested so I feel really new trying to learn some new ways to get funding and catching up on what still works and what doesn’t work anymore.
Conventional Bank
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I know most banks want to see a 20% down now, but will they allow the seller to hold 10-15% as a 2nd? and me with 5-10% in? my problem here is if I have to give 5-10% then I wouldn’t be able to show my 6 month PITI.
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I was also told gifts or seller assist is no longer allowed to investors (is this true) I was told this by a broker at known bank.
HML
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Anyone have any HML who lends to investor that holds (I checked all the HML listed in the resources center) 1/2 was no good to me b/c they don’t lend to PA and the others are just lending to flippers and rehabbers.
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Most are lending 70-75-80% LTV or FMV anyone got a HML to have a seller hold a small 2nd.
Comps
- Where do realtors get there comps from
- Is zillow still a pretty good place to get comps? any place better or used just for confirmation to backup zillow
With your background, you should prepare Profit & Loss statements on your properties so you can show that, your last 3 yrs of tax returns, current pay statement, etc to banks. See if you can contact some local banks and see if they’re dead set on a certain percent down for each deal. When we talked to the bank we’re using now, we originally wrote them off because the man said he usually wanted 30% down. After running into dead ends with many other banks, we called this banker back. He said he usually wants at least 30% equity in a deal. So I asked if we bought the properties right, if he was set on 30% down from us. He said no so we looked around and pitched a couple deals to him. He was willing to help and give us money for repairs too. So don’t count banks out until you’ve exhausted EVERY possibility. It is true that most banks are going to want YOU to have some of YOUR money in the deals so you don’t just walk away when things get rough, but you never know until you ask.
Realtors have access to find out what houses actually sold for off the MLS. You might even find a local Realtor’s website that lists recent closed listings so you could see for yourself.
Pretty much echo what justin said. keep calling some local banks, especially their COMMERCIAL bankers who usually have a much better idea with whats going on with investment props vs regular residential loan officers. I just got a small commercial loan from a semi-local bank when i refi-d out of a short term land contract. if you’ve got decent credit, good equity, and some available cash, then getting short term seller financing and then refinancing out is a good way to go right now. that’s the strategy I’m currently using…
as for HML, I’m not personally aware of any that will finance long term. besides, at the rates they charge it wouldn’t be profitable for you anyway…again, use them to get it into the prop and then refi out with a commercial loan. just a thought…
thanks guys, I will take your advise and call some banks and I do plan on using the hml to get in and then get out hopefully under 3 months.