100% financing, Interest Only, Non-owner occ - Posted by Ron M

import · October 11, 2005, 9:58pm

Posted by ZACH on October 12, 2005 at 03:05:26:

a short term adjustable rate mortgage, maybe a 2 or 3yr Interest only.

import · October 11, 2005, 9:58pm

Posted by Ron M on October 11, 2005 at 21:58:40:

Yes, you read the head line correct. I have a potential tenant/buyer who is ready to have me purchase a home for them and then lease/option it from me.

Here are the details. The tenant is a professional painter and can make the ARV or the home $190,000. It can possibly be purchased from the VA for $155,000. Tenant is willing to make a monthly rental payment of $1,575.00 plus an additional $400 per month option deposit for 12 months. I am an experienced landlord.

Additionally, they will come up with about $1,500 as security deposit on move-in. At the end of 12 months, they will purchase the property from me for $172,500 + closing costs. Since, I don’t really care about anything here but monthly cash flow, I am interested in putting as little into this deal as possible and maximizing my monthly profit.

I have a 750 credit score and good reserves. Does anyone know of a loan program at a reasonable interest rate that will accomodate me?

Thanks,

Ron M
Washington State

import · October 12, 2005, 3:03pm

Re: 100% financing, Interest Only, Non-owner occ - Posted by michaela-ATL

Posted by michaela-ATL on October 12, 2005 at 15:03:57:

Ron,

to be honest, I’d be careful.

It sounds as if there’s some rehab needed (“can make the ARV of the home $ 190,000”). What if the painter doesn’t come through? Can you really find tenants, that will pay enough to cover your mortgage? Do you have the extra funds to renovate the house? Imho, even if things are going perfectly, there’s not enough profit in it for the amount of risk.

Just my thoughts

Michaela

import · October 12, 2005, 9:44am

Re: 100% financing, Interest Only, Non-owner occ - Posted by Shaun

Posted by Shaun on October 12, 2005 at 09:44:49:

You should be able to find an i/o option on an 80/20 with your credit. Do you have 6 months PITI in reserves? How is the debt to income?

import · October 12, 2005, 4:27am

Re: 100% financing, Interest Only, Non-owner occ - Posted by Shane

Posted by Shane on October 12, 2005 at 04:27:59:

Aurora Loan Services, or one of the many lenders who sell their loan products, do 100% N/O/O purchases with an interest only option - stated income as well, 720 mid score required. If you can go full doc you’ll probably get rates in the single digits on the 2nd mortgage too.