Posted by DT (NY) on June 02, 2000 at 02:56:19:
Well it Depends, on 2 things which Bank you are worried about…lol…
If you are talking about the Bank you are buying it from than this is from my experience what there concerns would be
Will you actually perform …What if your buyer doesnt have the money to close they cant go after him because you are on the contract. THey arent going to pull it off the market in a situation unless a substantial down payment or a bank statement with proof of funds is available to close… And why is it you are using the banks requested title company I would be sure and get a nice title insurance policy if they are steering you to use there title company.Especially with it being a REO…
If its the bank where your buyer is seeking a loan
to get his funds and the title company is being hired by the buyers Lender than YES…Its very important to get that out into the open immediately…Many lenders are not allowing non seasoned flips anymore due to the increased arrests having to do with Mortgage Fraud on quick flips…Make sure the lender allows this because I have had several deals pulled days prior to close because of the title seasoning requirement…Most banks require between 6-12 months but there are still a handful out there allowing no title seasoning flips…FHA is one of them make sure you dont waste anytime with a lender that is going to pull it on you once they find out its a flip. I dont know about CA but in NY I believe there is even a spot on the Appraisal that asks has this property been sold within 12 months …
DT
First Deal and Another Question - Posted by Marty_CA
Posted by Marty_CA on June 01, 2000 at 20:48:58:
I’d like to thank this site for all the help I’ve received, directly and indirectly that has led to my first deal. Per LeGrand’s Cashflow course purchased through this site, I found an UGLY house in my new farm area. Went through the listing agent. Out of state owner looking to get out of this run down rental. Asking 75k, offered 38k, countered 50k, I accepted price if seller gave 5k towards my hardmoney financing costs and carried back 12k for one year. He accepted. Set to close next week. House was appraised “after repaired” at 79k which I think is conservative for this nicely appreciating neighborhood. Also, the house was listed as a 2/1 but upon inspection all parties discovered in has 3 bedrooms! Lender is financing the first at 35K and 17k to be used for repairing. I am putting up 3K.
My question relates to another deal in the works. It is a bank-owned SFR. I’m waiting for a counter to my last counter and think this is going to go down soon. But I want to flip this rehab to a buyer. I told the title company the bank wants to use that I want to do a simultaneous closing and that my buyer would be bringing the money to the table that I would use to buy the property from the bank. They are OK with this but say they must let the bank know of my plans sometime during escrow. Will this jeopardize the deal? At what point does the bank/seller usually find out about a flip? Will they be concerned that I’m using my buyer’s money to close with them? To anyone experienced with this that can clarify, I would be greatly appreciative!