Hello my people! I have just formed my first LLC. My wife and I are going to focus on the pre-post forclosure market. We have very good credit (694 & 701), We have $35,000 just sitting around (15k of that is credit card). We currently rent and have no home equity do to an unexpected job loss. We decided to start the company and here we are.
My question is this…How do you get financing BEFORE the auction? They need to be shown that you have a way to pay before they give you the right to bid. We can handle the down payment but need financing for the remainder. Due to not having a current job history I belive I will need to use HML. Can you get a HML to veiw a property and make a lending decision? Of course it would be based on not exceeding a preset limit at the auction, I would assume. ANy info would be greatly appreciated. Thank you.
What state are you in?
What is the estimated appraised value on the property you plan on purchasing?
You need a pre-approval letter from a broker.
You will have to go stated income stated assets on your pre-approval.
You need to research the auction a little more before diving in. Is it a tax deed sale or a tax lien or a foreclosure?
Hello, I always recommend going with a traditional lender first. Use a HML as a last resort.
“You need to research the auction a little more before diving in. Is it a tax deed sale or a tax lien or a foreclosure?”
I also agree with this statement. Auctions are great for people with capital. For an investor needing funding, it could be a waste of time.
Can’t go stated income. You need to have a job that can be verified. Self employent is too new…you’d have to lie about length of time the business has been open. Look for a True No Doc. On an inv. property, you’d have to put at least 5% down, but there are NO employment questions, no income questions…no asset questions either. If you have to state any of these things, you don’t have a True No Doc. It’s always better to use this product so that you just don’t have to say anything that’s not true. Good Luck! Sandra
One more thing…try not to buy the house through the auction. You’ll do much better by contacting the owner if there’s time, or the first lienholder. Buy it with the normal contingencies in place so you don’t have the risk of losing your downpayment in the event that the property is not satisfactory for the type of lending you go with. For example, it may be a board-up with no utilities on…no access for an appraisal…it gets hairy.