Much cash but credit fell from 670 to low 500's - Posted by Leonard

Posted by dealmaker on June 02, 2005 at 20:24:23:

tough to get loans anywhere for less than $40K, heck that’s a car loan. They’ll eat you up with points and junk fees. Remember, everyone who touches the paper, typist, filer, courier etc gets paid the same on a $350K loan as on a $40K.

I faced this situation about 15 years ago on a $31K deal. I pad CASH and that’s all I’ve done ever since. It eliminates junk fees, gives you GREAT flexibility when selling and eliminates any BS ideas about “tax savings” through paying interest!

Buffalo though, might need some extra cash to heat that unit, LOL.


Much cash but credit fell from 670 to low 500’s - Posted by Leonard

Posted by Leonard on June 02, 2005 at 07:05:12:

After losing employment, FICO fell from 670 to 530. Though still unemployed, I now have enough cash to start again, (proceeds of sale of NOO duplex I had during Denver boom of '90s.) Want to buy a (very) small home or rental duplex (Buffalo area). Would I be able to qualify for a loan to do this? If so, would I have to pay exorbitant rates: e.g., 15% APR plus 8 points? OR do I need to buy the house for all cash and own it first before a lender would consider me? (thus paying more like 9-10% APR with fewer points?) I also hear it may be hard to find a lender for a property under $40K in this area. - Any advice is highly appreciated

Re: Much $ but credit fell from 670 to low 500’s - Posted by John B. Corey Jr.

Posted by John B. Corey Jr. on June 03, 2005 at 02:54:18:

As someone else said, the number of lenders who make loans under $50K is limited with the few that do stopping at $25K. Check with local banks and mortgage brokers who know the area as they will know the lenders who are the most open to smaller amounts. Your credit score will be a bigger issue then the loan amount.

You can use hard money as you noted. You can pay cash.

You should also assume that if there are fewer lenders that will loan small amounts there will be more sellers open to seller financed deals.

Cash for discounts and sellers for flexible loans.

Hard Money when you need to do a deal quickly and other options are closed.

I have worked on a number of deals south of Buffalo so you can do a number of things depending on the specific situation.

John Corey
Chelsea Private Finance LLC