Question on assuming a loan - Posted by Doug

Posted by Chenel Moore on January 21, 2000 at 10:12:31:

Everything will depend on the equity and loan to value that you are at. How much equity do you have after you assume his mortgage? You can obtain a second mortgage or home equity loan easily if your loan to value against the property is not maxed out say 100% and if your credit score is 700 or above.

Lenders like to be secure with us investors so if you are in the 70% ballpark range with the 1st mortgage, maybe consider refinancing to a 90% cash-out investor loan, (if you can find one of those lenders who will do that type of loan).

Also if your bank will do that check with them to say if they do home equity loans on investment properties. Some do some don’t.

Question on assuming a loan - Posted by Doug

Posted by Doug on January 21, 2000 at 01:18:28:

Posted questions a few days ago under “Possible Deal”. I’m still trying to figure out how to put this together because I think it’s a good one. If I assume the seller’s loan, could I get a second loan from an institution to give him his equity? Would that 2nd loan be a mortgage or personal loan or what? I’d like to find out if this is possible and what options I have. In a perfect world I would assume his loan then borrow again to cover his equity/profit and still have a few bucks left over. Am I dreaming or can this be done? Thanks for all your help.


Seller Carryback - Posted by JohnWe (NoCA)

Posted by JohnWe (NoCA) on January 21, 2000 at 10:43:55:

You’re not dreaming, you’re on the right track. Ask the seller if he would carry back a note for his equity. This will get the deal done. Then, like Chenel said, refinance the property to get him paid off, and maybe even put some dough into your own pocket.