I’m looking at purchasing an REO, the house has extensive mold from a leaky roof. Four offers prior to mine have fallen thru because no lenders will issue a loan for the house. The listing agent says it must be a cash deal. They’re asking 98k, the houses ARV is 200K+.
Is there anyway around these lenders :banghead
See a hard money lender. You want to do a hard money rehab loan. These guys will loan you enough money to buy the house with a reserve established to rehab the house. As you finish with each phase of the work you receive a draw from those reserved funds. After the job is complete you refinance with a traditional lender and you have a house as good as new.
The purchase plus rehab and all fees have to be less than 90% to 80% of the after repaired value of the house.
Thanks Blue, I suppose I need to get a mold inspection done first to see how bad it really is, then I’ll procede with the hard money lender.
You could put it under contract and then wholesale.
I do not know of anyt HMLs that will do 90%. Even 80% is a stretch, unless you have a track record with the lender and reserves on hand.