money help

Im located in texas with 11 properties. I just closed on a deal that I put 10% down. It was an 8 plex. Normally I dont put any money down on properties, but this was such a good deal that i just could not pass it up.

Well yesterday I drive by 3 duplexes for sale. They are an awesome deal. seller is 83 years old and lives out of town. His son in law is selling them for 38k each. They are all rented at 800/month so it is a great cash flower. The only problem is that 1st the lown amount is 38K so I cant find a lender that will do 100% financing. I dont have any moeny left over after my recent deal.

I have a lender that will do 95% but I still have to come up with about $15,000. Any idea where I could get this and what intrest rate it would be worth? Or any idea of a lender that will do 100% on such a small money amount?

Thank you in advance
Justin

What’s the value of each property? If around $67K I may have a solution for you.

the value is $38,000 each. Every lender I have checked does not like to do this amount. If the properties would appraise at current conditions for more than I was thinking that perhaps I could do a contract for sale on 2 of them for the price of 3, then I could have the seller throw the 3rd one in for free.

However I dont know how much I would trust the seller to do this.

Guy,

There are a couple of ALT-A lenders who will do that size loan amount to 100% LTV as long as you are going full doc.

chritopher,
do you know the names of any of these lenders? I have talked to several brokers and the best I have found is 95%. Thank you.
Justin

Justin,

With your eleven properties, don’t you have any equity? if so, how much? Do you have a negative or positive cash flow? Any deal can be created if you put your mind to it. Give us the facts and you may find several people on this forum with some ideas you may want to consider. Good luck.

Da Wiz

You should look at an equity line of credit on some of the homes you have equity in. Or if your score is over 700 you could try for some unsecured lines of credit and pay cash for those things.

my middle score is about a 720. Would I get the line of credit through a bank or another investor? I have purchased my properties in the last few years. Every one of them cashflows positive and they all cashflow quite well. I dont have alot of equity any any of them. Im sitting right at 80% on all of them. i financed all of them 100% except for this last deal. In the past I have kept money in the bank and in return been able to use that as reseves inorder to get 100% loans. I spent it all on this 8 plex and then found these 3 duplexes. The positive cash flow on the 3 units is right about $1200 minus the water bill and repairs.

I have asked the seller to consider 3 options, one is I buy 2 of the 3 for an inflated price and then he gives me the 3rd one and carrys a note on the 3rd one for whatever is owed. option 2 is that he carries for 12 months, then ill re fi and get him his money. option 3 is that we raise sales price about $15,000 and he cuts me a check for $15,000 day before closing.

is option 3 illegal or just not something the banks like?

Thanks for all the info.
Justin

Cash out on close isn’t Illegal, it’s just not something banks lend on if they are aware of it. They want to lend on the sales price, not include a personal loan with the purchase of this house. But investors do it all the time, just make sure he doesn’t screw you out of the money if you do it.

Justin,

If you are going full doc Homecomings will do 100% LTV loans of that size. Your rate won’t be pretty, but with the cash flow on those houses you will be in good shape. Let me know if you need more information.

why not cash out your properties or acquire a seller note and refi later?

or just quit claim them and pay the seller off after you refi…