Anothers Perspective (first deal) - Posted by Brian


Posted by SCook85 on February 20, 1999 at 23:46:53:

You are putting yourself into a situation that will probably prevent you from doing this deal with no money down. There are programs out there in which the lender will do 100% LTV loans. Depending upon your credit they may give you an 80% first mortgage and a 20% second mortgage.
Typically you should be looking for a motivated seller to pull of a no money down deal. I doesn’t seem as though you have that here. Your seller is looking to make a profit and is asking retail for the home.
If you really want the home talk to mortgage brokers about 100% CLTV programs and seller participation.



Anothers Perspective (first deal) - Posted by Brian

Posted by Brian on February 20, 1999 at 09:05:06:

Okay here is the situation. I have located a single family house that is in the process of being rehabbed. This house has been completly gutted new plumbing wirring etc. it was a burnout. The seller is going to complete the house painting carpeting etc. She had an offer at 89,000.00, but they wanted the house as soon as possible. She bought the house cash so apparently has some money in the property. She has agreed to a seller concession which I pay for any way, And an offer of 90,000.00. Homes in the area are selling in the 90-120 range. The financing I have been able to find has been 5%-10% down with interest rates aruond 8.50-9.00%. The rents are around 1,200.00-1,300.00 with tenants paying utilities except water. Taxes are apporx. 2,600.00 annually.

She told me she most likley would like to cash out of the property so they can move on to the next one. At those numbers I have a positive cash flow of 300.00-360.00 a month but the problem I have is that I would rather not have to put any money out of my pocket. If I was to get the seller to agree to take back a second for the 10% @6% It works out to be just about the same payment wise, most of the time does that satisfy lenders who are lending 90%? What could be another way in which I could structure this to make It a no money down deal? Any thoughts would be greatly appreciated.
Another thing Is while working on the house she has had numerous people stop by and asking to rent it. I have asked her to take the names and numbers of these people. One lady across the street said she had a friend who would like to move to the area with and purchase with a L/O. This Is my first Investment property and I must admit that there is alot of excitment, fear and I have a bad case of the “what If’s” , But those seem to be out weighed by the possibilty of working for someone else for the next 40 years!