I am in need of suggestions on how to purchase a positive cash income producing package of properties. My current situation is such that all my cash on hand is tied up in a Rehab that will be used as my primary residence upon completion.
The package has 5 properties with a total of 16 rental units at 10% vacancy. The gross yearly income is about $100K. I am looking for 600K in financing to make this happen. Credit scores in the low 700’s but my credit cards are tapped until the refi is complete of my primary residence. The timeframe for this to be finalized is Nov. 06.
Any suggestions would be appreciated.
The following info is for financing on 1-4 unit properties. Why not try to qualify for 100% on all of them. Most of the lenders we use as mortgage brokers require that you have at least 6 months of mortgage payments for all properties being submitted. Those funds are separate from any money required at closing and need to be in your account for at least 2 months. Do you have any liquid cash available for closing? How about any retirement investment accounts? If you don’t have the required assets then you may need a no asset or no doc loan.
There’s lots of twists to these guidelines so make sure your dealing with someone who specializes in investment loans.
See if the seller will carry back.
you should refinance your current rehab to a construction to permanent loan, this will free up your current cash and allow for some manuvering. Also, depending on the property, you could finance the investments temporaily on high LTV arms. 95% LTV purchases can be done. The rates are high, but if you buy out the pre-pay, then you can refinance them once your house is complete. There are many ways in structuring your deal if your dealing with someone who is knowledgable in lending. If you want some more insight, just e-mail me. Under commerical financing or LLC, even on residential properties, the vacancy does not matter.