need loan for repairs & down, with owner carrying a 2nd

Im trying to figure out how i would go about this. Please help:

If you had a seller who agreed to sell a free and clear property for $107,000 if I gave him $30,000 down.

He’d carry $77,000 at 7% interest, or about $700 a month for 15 years.

It needed $20,000 in repairs and would resell for $169,500 with owner financing after it’s fixed up. [or $153,636 is the ARV]

Before closing & loan costs thats 26k in equity if you retail @ 100% of arv, & 43k if you L/O it

How I would go about getting a loan for repairs and downpayment only,
since the seller has agreed to have their note in a second position behind any loans i get for repairs & the down?

I’ve talked to 1 ‘hard $’ company that said they loan on the purchase price & repairs up to 70% arv with 14% interest,
& they usually steer away from 2nd liens over 10K because if they foreclose the seller would loose their second lien.

And how would you do the deal?

Any assistance given would be greatly appreciated>


Don’t take this personally, but this isn’t a deal. You’d be lucky to break even on this house and you could possibly lose part of your 30k down payment.

First of all, why on earth would you put 30k down on property you’re going to buy for basically, $100,000? That’s over 30% down. If you’re willing to put that much down I’ll sell you everything I own today!

Second of all, you aren’t following the formulas. Not following the formulas can be hazardous to your wealth.

The formula is:

70% of Arv minus repairs. I actually use 65% of ARV minus repairs.

If this house is worth $150,000 fixed up and needs 20k in repairs the most you can pay is $85,000.

Lastly, you CAN NOT ignore closing cost, loan costs, and holding costs when determining your profit.

If you buy this house for 107k and put another 20k into it you’re into it for 127k. In my experience, I normally net some where around 85% of sales price after closing costs and holding costs. Sometimes less if I hold it longer.

If you sell this out right for 150k you’re net is going to be around $127,500 or 85% of $150,000 which is exactly what you have in it not including your time, effort, sweat and tears.

Stick to the formula and don’t make emotional decisions unless you want to lose all your money.

I greatly appreciate your input. It’s people like you on this forum that make this an AMAZING site!!!

Thanks again