Re: no money down - Posted by Ed Garcia
Posted by Ed Garcia on January 25, 2002 at 10:22:48:
The most common way to purchase with “NO MONEY DOWN” is to do it with a seller carry-back. As far as mortgage companies underwriting guidelines of 10% down, that’s easy, don’t use a mortgage company.
However after saying that, most mortgage companies will do a deal NOO with 5% down and a seller carry-back of 5% doing a CLTV (Commutative Loan To Value" or “Combined Loan To Value” of 95%.
If you’ve structured you deal right and don’t have a credit problem, and show cash flow? A small bank can accommodate you. There are other local portfolio lenders who will also work with you. If you do have a credit problem then of course you’ll have to seek out Hard Money, get the seller to carry all of it, or seek out a partner.
There is a lot to be discussed on this subject, because I think that many of us come here to Creonline just to learn how to do what you’re requesting. However it’s difficult when your talking about it hypothetically and then some one will always want to tell you why that example doesn’t work for them and of course the reason is obvious. There circumstances are different.
Usually once an investor starts thinking creatively, you be surprised how many different combinations of deal structuring they’ll be able to come up with.
Of course for those who think conventionally, these ideas are considered either shady or unrealistic which is not the case. Putting money into a deal doesn’t make the deal any better; it just makes it safer for the lender. A good deal speaks for it’s self.