Posted by Eric on March 30, 2006 at 11:09:20:
It is bank owned, and no one in my family is in a position to loan me $25,000. Thanks for the reply though.
Hard Money Second Mortgage - Posted by Eric
Posted by Eric on March 30, 2006 at 10:18:56:
Ok, here is the situation, and I want to know if this is possible. I found a property with the following numbers:
Asking $120,000 (won’t get that much)
ARV $230,000
Needs $75,000 in Repairs
I’m intrigued by it since it will sell quick when it is fixed up, it is a huge house in a nice suburb of Cleveland.
Now I can borrow 70% from a HML, which would be about $161,000, and if you take out points and everything, I would be left with about $150,000 in usable money. I assume I could get this house for around $100,000, maybe even less. That means I still need about $25,000 to do the deal. I figure if I can get a hard money second for 10% or so of the ARV, my profit is still around $40,000. Is this doable? Will a HML do this, and if so, who? Keep in mind credit is a problem, so would a lender do this based on the equity? Any help or advice is much appreciated.
Re: Hard Money Second Mortgage - Posted by Jay Neal
Posted by Jay Neal on March 30, 2006 at 10:55:05:
Our firm and none of our local competition will do any loans where we are not in first position.
It is a little more common in the large commercial development arena, I believe, but that is not my area of expertise.
What about the seller taking a note or maybe Uncle Fred doing a small 2nd for you?