Need Advice, Please!!! - Posted by Richard-(FL)
Posted by Richard-(FL) on April 16, 2002 at 19:45:40:
Okay, here’s the situation:
Seller has a home that used to be his primary residence.
He has since divorced and remarried.
Ex-wife and he are still on the deed and loan to the property.
One thing to note is that he and his ex-wife still get along and have no hard feelings toward each other.
He and his new wife have bought another home and rented the previous home to a tenant.
The property’s info:
3 BR / 2 BA
Built in 1979.
Needs $15,000 in repairs.
Comps at $63,000 to $65,000.
Currently financed with the original FHA loan from 1986 (non-qualifying assumable) @ 12% over 30-years.
Remaining principal is approx. $35,000.
Monthly payments are $670 (P.I.T.I).
Rent rates in the area are $650 to $725 per month.
If I take the property subject to the existing financing (even though it is NQA, I could save time and money…not paying an assumption fee…by just taking it sub2 and getting the deed), I will not have any money to do the repairs.
If I use a HML, the LTV is there for the purchase price, but I will still be unable to get the $15,000 for repairs.
Is there any way of taking the property sub2 and borrow the $15,000 and use the property as collateral (even though I have the deed, the existing financing will be in the seller’s name)?
I could LO from the seller and not have any payments due until the repairs are complete, but I do not have the $15,000 for repairs.
I know this deal can be done, but I need some advice on how to structure it.
Any help will greatly be appreciated.