Hi to all! This is my first time posting on this sight but I have been reading everything on here for weeks.Here is my problem:I want to start my business rehabing houses.I have done alot of reserch,classes,ect.My problem is the money.I went to get a home equity line.They tell me the most I can get is 100,000 on a stated income.(We have to go with the stated income because my husband is self employed.A carpet installer for 18yrs).So after all the deductions it doesnt look like he makes much.With the money they want all the bills on our credit to be payed.Thats 40/50K So Ill only have 50K to work with.Im my area townhouses go for 150,000 to 200,000.I cant get a conventional loan because of the income.Hard money lenders want 14%.Does anyone have any ideas?Please help!!!Thanks to all that reply.I really like this sight.Thanks,Michele
Hi Michele,
Knowing what your credit scores will be an important start.
There are conventional rehab loans that will allow you to use stated income. There are even a couple who will base the loan off the fixed up value and not require a downpayment.
Even getting a hard money loan may be an option. If you get the credit line that money would reduce the amount need from the hml. For loan amounts around 100K, a hml can be about the same in costs as conventional financing.
The benefit with the conventional financing is that the loan modifies into your end loan, so no refi is needed. Not sure if that is important as you never mentioned if your strategy was to sell or hold.
Lots of other important questions too. I would suggest contacting a mortgage consultant that specializes in investment loans.
Sorry I forgot to say what my credit score is.I couldnt find the paper but It was around 680.It was not great but not bad.I also wanted to resell the houses at first.Some of the rehab loans wanted 20,000 in the bank and 14% interest.Maybe Im putting to much into this.Maybe thoses loans wouldnt be bad as long as the numbers worked.Its not going to be a long term loan.I talked to a couple of different rehab banks and they said pay your bills off get some money in the bank then go for your loan.In my area its hard to find good deals unless you go into Baltimore City.I like it in the Country so eather I have to get over it (not wanting to work in the city)or maybe do more leg work to find the deals!Thanks for replying,Michele
Please provide me with the state that you’re in. I can direct you to some honest and progressive advice…
Thank You,
Maryland!!!Thanks,Michele