1st deal (rehab that is) - Posted by John P

Posted by Chris on August 21, 2003 at 20:26:43:

My exit strategy in the past has been both to refi, or sell. Refi’s are getting tough! They want to lend 75% of the purchase price until you’ve owned it a year! If you can hang onto it for a yr with the present financing in place you are golden. while you are getting that year under your belt you can either rent it or lease option it. As far as selling goes you have 3 options FHA, Conventional or create a note and sell it. Screen people best you can over the phone with an ad that says OWNER FINANCING
small down $550.00 per month. You are going to need soemone with 600 fico or above for all three unless they have major$$ down. I can pull credit from home, if you can’t find a huungry mortgage broker who needs some new business and get him to prequalify your buyers in 24hrs or less. If they have 5% down you can sell the note but keep the note amount over 50K or you are going take a hit on your cash out. I know brokers that will pay 90 cents on the dollar for them with 5 % down. So if you go that route you can close in 2-3 weeks but you’ll only make 12K. If you go FHA there are more hoops, they want to appraisals a scope of work, etc. but you’ll get more but you’ll close in 5 or 6 weeks, and probably pay a few grand in closing costs and prepaids for your buyer.
hope I helped
chris

1st deal (rehab that is) - Posted by John P

Posted by John P on August 21, 2003 at 16:54:38:

I’m a new investor, I have bought properties in the past, however I recently began actively looking and got my first offer accepted. My exit strategy is rehab, then sell or ownerfinance If I can get appropriate finance.
Purch price 25,000
ARV 55,000
Estimated repairs 10,000
I have the ability to borrow enough to purchase and do repairs but I’d like to know the best way to fund this project without over extending finance. If I purchase this with funds I borrow against other collateral, How to I get cash out after the rehab, or how will my buyers get financed in 4 weeks after repairs done?
Everything was clear to me before, but now that I actually got a deal to rehab, I’m kind of fuzzy about the seasonig issues I may face. (getting my money back and pulling cash after my rehab’s finished, or my buyer getting financed with me owning the home for only 6 weeks or so. Any help appreciated.

John