Re: Loan Sources… - Posted by Ed Garcia
Posted by Ed Garcia on November 21, 2000 at 10:14:08:
Mike,
Thank you for your contribution of lenders.
Associates, cost is high and Associates has just recently been bought out, and is making changes in their lending criteria as we speak.
Metropolitan of Washington, I will check out and see if they lend “Nationwide”, remember here on Creonline, we need to share lenders that are in every State.
Your private IRA, once again is of no use to anyone here on Creonline.
Local convential lenders, once again are of no use to Creonline participants. However, they are usually portfolio lenders, and can be flexible in their lending criteria. I encourage people to seek out portfolio lenders as well as small local banks in their area.
I think our viewers will find it difficult to find lenders who will refinance lease/options with consistency. Most lease/options are NOT written with refinancing them in mind. For example: many of us who write a lease/option and remember, the original post was the “Death of the sandwich lease/option”. Don’t properly structure the payments so as the lender will accept the difference to be added towards the down payment. Most lenders who do lease/options will allow only a portion of the monthly payments to be applied towards the down payment and that’s if it’s above market rents. The majority of investors who do lease/options are not aware of that.
Sandwich lease/options have a particular stigma, because the seller has not held title in their name. The vast majority of lenders attitude is, not only, How can you sell a property that is not yours? But they have a problem with a seller receiving equity that is not theirs as well. The seller usually applies down payment from the monthly payments and both the seller and buyer are using equity in the deal to make it happen, which is not theirs.
This, as well as Seasoning of a deal, is a problem for most “National lenders”. The reason being is that most lenders sell off their loans or want the ability to sell off their loans and want to originate loans that are marketable.
Ed Garcia