Recently, I was asked by newbie investor with a question. This newbie investor found a REO property and did some work with hard money and lease buyer is in place. This all happened couple of months ago. He is facing high interest rate hard money payments and wondering if there was mortgage company specialize in working with investor that need to get lease buyer qualified to cashout the investor. Is there a qualification for lease buyer? How long lease buyer’s contract need to seasoned? Full amount is financed?
There are plenty of lenders that will do this type of loan. The seasoning will not matter.
Chris,
Are you one of those lenders? It’s good to know that seasoning don’t matter but what are other criterias? I am sure there are some challengies. This is my final piece of the puzzle for team member set up.
Actually seasoning will matter if the buyer wants to refi into the property. If they want to do it as a straight purchase, it should be fine as long as the buyers are qualified and the broker uses a lender that does not require seller seasoning.
How long do you consider seasoned? 6 month, a year? I am planning to get hard money to purchase and fix up the property then I will have qualified leaser purchasers refinance the property to cash me out. I understand it’s easier said then done; however, if its’ necessary, I will hold them for up to a year for them to cash me out. Some lenders have a credit repairing program that helps the lease purchaser to buy with low credit score, providing that they have good income and past performances as renter or mortgagor.
It can be done in 6 months, although most lenders require a year to do it as a refinance. You could always just sell it at a higher value to them than intended and pay all of their closing costs out of the proceeds up to 6% of the loan amount. I have an investor that does it that way as well if he does not want to hold it for a year. I think you need to network with a solid broker in your area that deals with primarily investor loans.
I have found a lender who is very sharp in working with real estate investors. few month ago, I would of thought that using ARM would of been a financial suicide; however, I am starting to think that, ARM is way to go until market start to pick up after Fed annoucement in August about not raising the interest rates. I don’t really care if the lenders are out of state from where I am … I am willing to travel for any type of sound deal that makes honest money. Their loan program has to fit my purchasing, holding and exit strategy.
Where are you investing?
Currently in Minnesota. Keeping my eyes on Vegas and Texas.
Everyone keeps saying there are lenders out there that do this type of loan but no one is giving out names???
Can someone please tell us newbies the names of these companies?
Long Beach is one company.
I take it that, long beach is in California? Florida? Are there anymore like this lender? Anyone?
Long Beach is nationwide. They are owned by Washington Mutual. Companies like Long Beach are only accesible to brokers. They do not deal directly with the public. Ask your broker which wholesale lenders he or she uses; they will probably have a wholesale lender that does not have seasoning rules especially if they are investor savvy. Hope this helps.
Christopher: How hard is to start your own mortgage company? What is entailed?
Thanks for the link. Looks like it’s better to be compensated by referral than own the company. ;D
Starting a mortgage company can be $$$$. Just find a good honest lender and stick with him or her. Consider them the same way you would consider your doctor, lawyer, and financial adviser. Part of the team keeping you healthy, wealthy, and wise. 
Does lender pay for referrals? What is the percentage?
it is against the law for a lender/ mortgage broker to pay for referrals. sorry.