Need mortgage suggestions, plz... - Posted by Jackie in Dallas


#1

Posted by Carol on January 14, 1999 at 06:56:35:

We have several HUD properties and it seems to me that they will not accept assignable contracts - but that may be on owner occ only. If this was up for all investors, it may not be the same.


#2

Need mortgage suggestions, plz… - Posted by Jackie in Dallas

Posted by Jackie in Dallas on January 13, 1999 at 18:02:47:

There’s a young married couple (19 years old) that would like to buy a house. They have less than $1500 cash.

The won a HUD bid @$57,000 (with HUD paying all closing costs)- after a new roof, paint and carpet, the house will be worth about $80k.

They’ve been turned down by all mortgage companies I know - got any creative suggestions? I wish I could find a way to help these kids out.

One of the problems is that they are both waiters making about $3,000 a month combined. She’s been on her job 1 year he’s only been on his current job about 5 months. He just got a new job starting in 2 weeks making $34,000 for a computer company - with benefits.


#3

Re: Need mortgage suggestions, plz… - Posted by Bud Branstetter

Posted by Bud Branstetter on January 13, 1999 at 22:35:20:

The realtor that had them submit the bid should take the hit and refund the deposit or at least lose their license. What has been not been said is what the present value is and how much cash to fix up(guessamate 7K). With that it is minimal to be able to get them much for a flip to a cash investor. Ownerfinance or lease option is what they need for now.


#4

Re: Need mortgage suggestions, plz… - Posted by Reif

Posted by Reif on January 13, 1999 at 21:41:46:

I’m a new guy so please bear with me. On a HUD auction, does HUD finance it?

I guess my question is this: Are they under the gun to come up with 57K, or are they looking for a loan to make the place habitable?

I’m assuming if they need the 57K, then the problem isn’t their credit (or lack thereof) but the LTV of the run down house?

Reif


#5

Re: Need mortgage suggestions, plz… - Posted by Carol

Posted by Carol on January 13, 1999 at 18:09:36:

Jackie, is this NOO or for them to live in?


#6

Re: Need mortgage suggestions, plz… - Posted by Rob FL

Posted by Rob FL on January 15, 1999 at 21:16:42:

HUD does not given loans. They insure loans via the FHA. All the loans are made by private mortgage companies under FHA standards.


#7

No … - Posted by Redline

Posted by Redline on January 13, 1999 at 21:44:07:

Their problem is they don’t have great employment history and they don’t currently make enough money. (i.e. they probably won’t qualify for a mortgage).

RL


#8

Re: Need mortgage suggestions, plz… - Posted by JohnG

Posted by JohnG on January 13, 1999 at 21:17:45:

How about getting them to assign their deal from HUD to you and then you selling it back to them all renovated on a lease/purchase for 80K ?
Would this be win-win or win-lose ?
After all, if they lose the deal because they can’t raise the money then they have nothing - this way they will be able to buy (at a later date) and even tho they pay more they will OWN something.


#9

Re: to live in (nt) - Posted by Jackie in Dallas

Posted by Jackie in Dallas on January 13, 1999 at 20:49:48:

to live in


#10

Re: No … - Posted by Reif

Posted by Reif on January 13, 1999 at 21:49:19:

If their credit is the only problem, then couldn’t Jackie (or someone else they know) just co-sign with them?

Reif


#11

Re: Need mortgage suggestions, plz… - Posted by Redline

Posted by Redline on January 13, 1999 at 21:37:06:

Creative! I like it, but:

  1. They may not be able to assign their deal.
  2. If they can’t get financed (eventually) she’s stuck holding the property. (albeit probably making money at the same time …) She might not like the property all that much.

Jackie - is the property in your neck of the woods and is it worth it?

RL


#12

Re: to live in (nt) - Posted by Irwin

Posted by Irwin on January 14, 1999 at 04:07:59:

If they bought the HUD as owner occupants, I don’t think there’s anything you can do for them short of loaning them the money. In addition to a mortgage, you could perhaps secure an equity postion with an unrecorded land contrct, i.e. they sell to you on contract for the $57k that you put up and you option it back to them for a marked up price. I have no ideal if this would violate the HUD rules of owner-ocupant sales or not. It’s just a thought.


#13

Re: No … - Posted by Bud Branstetter

Posted by Bud Branstetter on January 13, 1999 at 22:26:36:

Co-signing with someone is not a good idea for an investor. I know of people that make a practice of getting a so-called investor to originate the loan then wrap/contract/LO to the end user. They share the profit. I consider it a very dangerous practice for the signator.