Posted by JoeB(Atlanta) on January 31, 2000 at 16:23:15:
Hi Jon, with the scenario you described two quick ideas come to mind:
you could LeaseOption it from your Seller and his new lender should give him credit (on his ratios) for 75% of the lease payment you’re making to him.
you could get a loan for 65-70% of LTV (using the numbers you described…you could even get hard money loan for this)
Good luck,
Joe Brillante
Newibe DEAL? - Posted by Jon Adam
Posted by Jon Adam on January 31, 2000 at 13:14:43:
I have a home that I am looking at tommorow. The seller is eing transfeered and wants to sell me the home for what he owes on it. He owes 52,000 and had appraisal 3 years ago for 67,000. I have driven by the home and it is immaculate condition on the outside. Homes in the area are selling around 80-85K. The only objection that he has is that he needs to get the loan out of his name so he can purchase another home. (I guess because of Debt ratios) My problem is that I do not have a buyer lined up and I do not have 52K laying in the bank. The loan is not assumable. Any Ideas?
Thanks for the help
PS… My goal is to flip the home
Thanks
Jon Adam
Re: Newibe DEAL? - Posted by TC
Posted by TC on January 31, 2000 at 22:00:12:
Hi Jon.I’m probably as close to being a newbie as you are but you might try this.Get this under a Option contract with as many days as possible.I did one recently and got 75 days.I then started marketing the house with a sign in the yard and an ad in the paper.
I have gotten several calls and have shown the house a few times.
Today a lady called that looked at it and said she wants it and that she is prequalified.
I meet with her Wednesday to sign a contract and go to a double closing.(Good idea to have a title company lined up in advance that understands simultaneous closings so things will go smoothly)
At closing I will get a check for around 18k(depending on my closing cost.(The title company says they can do a pass thru title policy to save me on that cost.)the existing mortgage gets paid off,the existing home owner gets a check for 18k and the buyer gets a nice home.WIN WIN WIN!
Re: Newibe DEAL? - Posted by Jim IL
Posted by Jim IL on January 31, 2000 at 19:35:58:
Jon,
As said in the other response, the seller may not really need to get the home loan out of his name.
Talk to him some more, and test the motivation level.
If he is being transferred quickly, then you can offer him several ways to get out of the home QUICK and still be able to get his loan for the new home.
Most lenders will give the seller credit for 75% of the lease amount.
So, if you rent a home for $1000/month, he gets credit for $750/month.
This may be enough to get him his new loan.
See who he has talked to and gotten this information.
If he says, “no one” or “so and so”, get him to a good mortgage broker, amybe even one you know.
They can show him what needs to be done, and what he gets credit for.
I recently had a lender tell me that IF a seller has his old home sold on a Land Contract, then the new loan is not affected as much, since the old home is sold.
I have yet to talk to him about this in detail, but it seems to work better than the 75% credit on a lease.
(unless thats what he meant).
OR, if his current payments are low enough, then do a L/O and make your paytments high enough so that the 75% credit matches his payments.
If there is still room for a profit for you that is.
Bottom line is, it can be done, your job is to get the seller past his objections, and show him how.
After you talk to the seller more, come back here and post, I’m sure you’ll get better answers with more details.
Good luck,
Jim IL