no Title seasoning, 75-80% LTV commercial Refi or Equity loan ????

found a 8 unit property in Kentucky, with no current mortgage … owner is a friend … has anyone heard of seller putting buyer on deed then buyer getting a no title seasoning refinance loan to pay off seller ??? I’m not taking cash out, just thinking outside the box to make it pretty much a no money down deal for me and get seller cash that they want… seems simple to me to just put my name on deed then match that with a no title seasoning refi. or equity loan … anyone ever done or heard of this ??

If buyer simply puts you on title with him then BOTH of you will have to execute and be responsible for the mortgage.

Just have the seller deed the property to you, ‘Sub2,’ into a Land Trust, and update the insurance, etc. Then work on refinancing the property. Eventually, you’ll have to pull the property back out of the Land Trust, and after the loan is secured, transfer the title back into a Land Trust.

Issue: On commercial loans, it’s particularly important NOT to do a naked ‘sub2’ title transfer, but use the Land Trust to obscure the transfer. Otherwise, you could end up with your loan being called. Not likely, but possible. You’re already refinancing, so even if the loan were called due, you’re already working to solve that issue.

Issue: The tax basis will be adjusted to ‘market value’ and may or may not reflect reality, but your taxes will likely increase.

If the seller trusts you, this is an excellent way to save money, and make financing easier to secure.

Issue: Refinancing may not cash out the first mortgage. There needs to be at least 20% of perceived/actual equity at time of refinance.

Notwithstanding, the loan you get will likely be based on the performance of the property, not your credit, so you will need solid, verifiable numbers that document the income and expenses for the last three years.


Bill H … I wasn’t thinking both on deed …I was thinking having the deed signed to me but held by my attorney who can fax a copy to the bank and tell them they will be presented with the original on day of closing… That is the whole point of finding a lender that will allow a no title seasoning Refi… . Also, if we are both on deed would the bank look at it as a partner buyout, give me a loan and quit claim the other off deed at closing???.. THIS kind of thing is done all the time between spouses that are divorcing and relations, was just thinking WHY couldn’t you do the same with a friend or anyone for that matter wanting to sale, that is willing to do a deed over so you could get a refi and give them their cash… the main key I think is the lender having a no title season refi program…

Javipa… there is no mortgage currently on the property so due on sale is not a issue…

You’re complicating this. Just get the deed, record it, and then refinance.

Of course, if you’re not sure you can refinance, then it’s wiser simply to get the deed in hand, hold it yourself, and then when you get a firm commitment on a refi, then record the deed. Why? Because once you’ve recorded the deed, the tax mill rate will change …permanently …even if you deed the property back to the seller (because you could not successfully refinance, or ???)

Unless attorneys are required to close in your state, a title company will handle all the title and escrow details involved in the refi. Otherwise, there’s no need to have your attorney hold the deed, and fart around with presenting it to the bank, and blah, blah, blah.

I don’t understand why you would have your attorney hold the deed at all. Once the seller signs the deed, it’s been effectively delivered, and the only thing remaining is recording the transfer of ownership. ???

Javipa… … I would most likely be using a mortgage broker so all paper work would be handled by their title company… even though i have my name on deed ,if you are not a spouse or related, most lenders have a seasoning of 6-12 months before they will refi. … i know there are lenders with no season refis out there , was just wondering if anyone has ever put these two parts together to do a deal… Refi goes off appraisal not purchase price plus all closing added into the loan… seems like a easy way for a no money down deal if you have a seller willing to deed over and a lender willing to refi not caring how long you have been on deed… I was just thinking this sounds way toooo easy… was wondering if i am missing something?? … Also, even if it did have a current mortgage, if deed is signed over and held by title company but Not recorded until day of the refi. closing, there is no way a current mortgage holder would know about it before the closing . After closing, the proceeds would pay them off so they wouldn’t care anyway…am i right in this thinking???

You’re not missing anything. Everything you said is correct.