Posted by Jim Kennedy - Houston, TX on September 18, 2000 at 13:36:05:
You also might want to post your question on the brand new Financing Forum
http://www.creonline.com/real-estate-financing/wwwboard6/index.html
It just opened up late Friday evening.
Hope this helps.
Best of Success!!
Jim Kennedy,
Houston, TX
100% owner financing then refinance with bank - Posted by BJS
Posted by BJS on September 18, 2000 at 12:40:05:
I am looking at a property which has seven units. There are three ‘houses’ with a total of seven units. All properties are on one deed so no subdividing. I am told I need 20-30% down for this due to the fact it is more than 5 units so it is considered a commercial loan. Could I have the owner do 100% financing and then just refinance the deal in 6-12 months? It will still be a commercial loan, but if I already ‘own’ the property, will I still need 20-30% down? Any and all suggestions are, as always, greatly appreciated!!!
Re: 100% owner financing then refinance with bank - Posted by Charles
Posted by Charles on September 20, 2000 at 23:07:09:
Considering the bank lending the money will want a 1st lien, are you sure you will have 20-30% equity by that time?
Re: 100% owner financing then refinance with bank - Posted by SCook85
Posted by SCook85 on September 19, 2000 at 07:57:04:
When you go to refinance the home, the lender will lend a percentage of the appraised value. This will typically be 70% of the appraised value. Sometimes you have to wait one year before the lender will lend off of the appraised value otherwise it will be off of the sales price.
If you can find a lender that will lend off of the appraised value and you are going to increase the value of the property this could be a good strategy, otherwise your seller may be stuck with a long term note.
Steve