How to finance this potential deal?? - Posted by AR_CT
Posted by AR_CT on March 22, 2002 at 15:30:59:
I’ve been reading this forum and is a great place to learn REI. Thanks to all of you who share your expertise with all the beginners, but I still need some Financing How-To ideas…I would appreciate if anyone could direct me as to what is the best way to pursue the following potential deal:
A four unit multi-family sells for $ 120,000, the owner has approximately 13,000 in equity (mortage for 107,000). He’s listing the property with a Realtor so I figured this much out:
Borrow the broker’s commission, offering a note in the amount of her commission ($ 7,200) and since the owner doesn’t need down payment, offer the owner another note for the equity ($ 13,000). That leaves me with $ 100,000 I need to come up. My credit rating is really good (I don’t have the exact number though) and I don’t want to use any of my savings in this deal.
Is it possible to obtain a loan in the amount of $ 100,000 (83% of the value of the house) without a down payment with a bank or mortgage broker?
I own a house but I’m hesitant to use the equity in my house (approx. $ 50,000) as a guarantee for the loan. I’d like to do a lot of deals like this one, so why should I use the equity on my equity just yet!?
Should I explain the bank or the mortgage broker the details of the deal I’m trying to get into? Any feedback, suggestions, ideas will be greatly appreciated! Thanks.