I have a house in Houston I would like to acquire for 45k and put <10k into it and sell at market ~75-80k.
I have a 650 beacon, 10k in bank and a job making 65k.
Why am I having lenders give me a stonewall? price of the house too low to make it worth somebody’s time? Is it that nobody wants to work with a first time investor?
I know lenders scour these boards so, pm me and let’s talk.
You should be able to get a loan just fine. What are they saying your issue is?
Have you tried Excel Mortgage in Houston?
They do purchase rehab up to 80%LTV of after rehab value.
Jo se
I agree with Ramona. With the parameters that you posted you should qualify easily.
It is true that it is getting harder to find lenders that will do loans below 50k. They are out there it just requires a little research.
Hello, Ramona and Mark are correct. It is becoming very hard to find lenders under $50K. And your credit is good. You are partially right though, some do not want to waste their time with small loans. But there are lenders out their that will do under $50K.
I’ve been told the financing is going to kill the profit. Since the loan is <50k I will get slammed in fees.
I remember reading a post from I think his name was reoconsutants or something like that …reosomething…and he said he was able to get the equity up front. After doing some research it sounds like bank fraud, I’ve been told that mortgage co will not finance rehab costs w/out strict oversight and more fees. Can somebody here speak about cashing out equity before rehab begins?
You should not have to pay more then $2000 in fees if even that.
You should check with another lender. There is someone out there that would love to work with you. Hang in there.
Talked with a hml and they wanted 6 points plus fees. Help me please. Nobody will talk.
BNC Mortgages does loans to 25K you need to find a broker that uses them. You will be just fine if you work with a broker that is familiar with them and with investment homes.
How did this work out for you Hardwire? I am having a difficult time finding financing for less than 40k also.
I have one person now, whom I like, but he keeps busy so I would like to find a backup.
Yes It can be bank fraud if you do not disclose it properly
every one must know what is going on
there is two things that can be done and only two ways
ONE
You can do this with 10k worth of work
put in the contract when you purchase it that the seller will pay XYZ Contractor for the work to be done and he will get the money at closing.
Now what you have to do to protect the money is one have the work done by the contractor prior to the sell and the seller orders the work to be done
the other way is that you put the money in an ESCROW account before the work is done and then when the contractor finishes the work and releases all liens on the work then you give them the money by the title company that way your money is protected.
YOU DO NOT WANT THEM TO HAVE THE MONEY BEFORE THE WORK IS DONE THEY MAY RUN WITH THE MONEY AND THEN WHAT 
TWO
You put in the contract that the funds will go to a LLC that you one one the purchase contract that way it is on the REPC and the HUD one and the lenders and attorney and Realestate agents and Mortgage people all know what is going on and thus it is not FRAUD because it is fully written up and disclosed and the lender can decide whether or not to do the loan
I have not had a problem once doing it this way. You must have a broker that understands the ins and outs of this though and check the HUD 1 to make sure all the funds are accounted for correctly it is your money so check it
Skip the broker and start calling local banks.
hardwire,
I just called a Lender and here is what they said “bla bla bla, bla bla, bla bla bla.” If you need cash to purchase and make improvements, USE A HML. You may need to call several to find the best terms. Try to find investors in your neck of the woods to get referrals for the best sources of hard money. You should know that the best hard money comes from private investors. Typically, they don’t advertise or hang a sign. Additionally, I wouldn’t get all hung up on fees with these guys. What they do is measured in risk and reward period. Figure out what is really important to your deal. If the fees eliminate profits, find better properties. If you’re in this for the long haul, a couple of good HML sources will make your life so much easier. If you’re flipping the property, there is a reasonable chance you won’t need to refinance the HML out of the deal. If it’s a buy and hold, you will need to go to the bank to pay off your hard money guy. At this point, it’s a much easier deal to finance. I use first money equity loans when loan amounts are small or there are seasoning issues. The bank I use will lend up to 90% of appraised value with full documentation. It’s an interest only loan. Don’t know what state you’re in, but most have 5 good loan officers. The only way to find them is through the referral network. Ask real estate agents, title companies, real estate investors, and appraisers for a name. I’ll flat out guarantee the best name will come from the real estate investor who’s been around for more than five years and has owned 100 or more properties. MOST loan officers, whether from commercial banks, brokers, or mortgage banks are clueless when it comes to real estate investment finance. I hope this doesn’t come across in an irresponsibly arrogant tone. You can only take so much of the blather that many well intentioned and unequiped money people offer.
Keep it simple
-H
If you own a personal residence and you have some equity in it you have an option.
Assuming:
45K Purchase
10K Improvements
55K Requested Loan Amount
Personal Residence Valued @ 150,000
Mortgage owed on personal Residence $100,000
Lender will give loan up to 64K
(55k + 150K * .80 - 100k)