Re: Will lenders lend 80%LTV w/ owner carry back of 20%?? - Posted by Ed Garcia
Posted by Ed Garcia on May 23, 2000 at 10:13:55:
Today, financing is so available that it’s unreal.
There’s100% financing available for owner occupied, and 90% financing
available of none owner occupied.
As investors we make money when we buy investment properties, or
we shouldn’t buy them. With that taken into consideration, the cost of
the financing should be relative to the purchase.
There are so many programs available that it’s a full time job keeping
up with them, and they change as were learning them.
So let me give you a little rule of thumb. The loan with the best cost,
is always going to be a Fannie mae/ Freddie mac loan.
Now with not going into a lot of detail, these loans are becoming more
flexible as far as programs are concerned. Not in their underwriting or
qualifying, but are just developing more product or types of loans.
Sub prime is the way to go for the investor. It’s a little more costly, but
Remember were making money when we buy, so that cost should be
absorbed in the deal. Remember, in many cases the loan allows you to do
Now the answer to your questions is YES. It depends on you,
your circumstances, and the lender that you use.
The majority of sub prime loans will go 95% CLTV.( Combined Loan-to-Value).
Example: If the house is purchased or valued at $100,000.
You got a new first of $80,000 and the seller carried back $20,000., that’s a 100%
The lender would require you to come up with 5% of your own money, which in
this case would be $5000. The lender would then do $80,000 first, the seller would
carry a $15,000 second, and you would come up with $5,000+closing cost.
After telling you that, I do have a program that does 100% CLTV.
One more thing Sean, there are several programs available where you can borrow your
down payment, you just have to document it. If you do a no income, no asset loan,
you don’t even have to document it.
Sean, I hope this answers your question,