80/20 deal or other ideas - Posted by Randy Watkins

Posted by Bruce Lawson on June 06, 2001 at 04:55:51:

Hi Randy,

Have you seen your credit reports? Are you sure everything reported on them is accurate? Many times items get placed on peoples reports without them knowing of them, resulting in a low credit score. Another thing to look at is the amount of inquiries each one of these will drop your score 5-10 points.

Check to see what agency the lender pulled from, if they pulled from Transunion that would come in the middle. Equifax will be the high score, these are just some things to look at.


Bruce Lawson

80/20 deal or other ideas - Posted by Randy Watkins

Posted by Randy Watkins on June 06, 2001 at 04:28:34:

I am in southern cal and am looking at a property that on which I would like to make an offer.

The price is 92,000 3bed/2bath. The seller has an old FHA non-qualifyiing assumable mortgage for 52,000 and the rest is equity. The fha is at about 9 and1/2 percent on a 15 year loan with a payment of $750. I would like this property for rental. It will pull $800 per month in rent.

I am thinking about an 80/20 deal where I finance 80% (72k), give the seller 20k and have him carry back the other 20. Problem is, my lender tells me this is a 100% deal and my fico is only about 580. I have good credit, but fico is low. I have read about many no down deals like this. THey say you just trot down to the lender, get 80% and have the seller carry back 20%. THis being a 100% loan is new to me. Am I supposed to try to get the seller to sign over the deed first and refinance or is the type of deal I am describing possible without doing that?

Of course it is possible that I assume the 52k and try to get the seller to carry all the equity, and then refinance later, but not likely, besides the fact I would have negative cash flow until I did refinance.

Key is that I am trying to get into this property with no money down.

Thanks for any help