Posted by Bryan (VA) on May 20, 2002 at 11:18:35:
I believe that you must have the intentions of occupying the property…sometime peoples intentions change…just a thought!!!
Fixer uppers - Posted by Brad
Posted by Brad on May 17, 2002 at 19:16:38:
If I were to buy a fixer upper at around 70% of FMV and put 20% into fix up costs, will the bank take the additional 10% as a down payment? (I want to buy and rent the properties with little / no out of pocket money)
This is assuming that I can get a construction loan for the purchase and fixup cost?
Thanks!
brad
One possibility. - Posted by Brent_IL
Posted by Brent_IL on May 17, 2002 at 23:56:01:
Ask around to find a local mortgage broker who does HUD Section 203(k) loans. This insured loan program is HUD?s main program for the rehab and repair of SFH?s. It combines the acquisition loan, the repair funding, and the take-out loan into one loan. One-stop shopping.
Applying for the loan is a quasi-hassle, but doing all the paperwork works to your advantage.
Here?s a reference site.
Re: Fixer uppers - Posted by MicheleCO.
Posted by MicheleCO. on May 17, 2002 at 23:26:34:
Most banks will loan on purchase price or appraisal price only. A hard money lender may loan on After Repaired Market Value and MAY loan fix-up cost. Their rates are higher and they charge points, but if you are doing a rehab, just consider this as a cost of doing business and adjust your profits accordingly. Hope this helps. MicheleCO.
Re: One possibility. - Posted by Dwayne Smith
Posted by Dwayne Smith on May 18, 2002 at 02:26:56:
Hud 203k loans are not for investors anymore just for owner occupants. They changed the law its in faq section of the hud web site you recommended.
No longer a possibility. - Posted by Brent_IL
Posted by Brent_IL on May 18, 2002 at 08:27:21:
Your right. I thought it only applied to condos, but I found your reference at #21 in the Q & A section. Thank you for the correction.
“21. Can an investor use the 203(k) program? No. In October, 1996, the Department placed a moratorium on investor participation in the 203(k) Rehabilitation Mortgage Program.”