Posted by Nate(DC) on November 11, 2002 at 15:48:15:
I doubt that. The reason they have so many foreclosures is sheer volume; they are one of the top 5 residential lenders in the US and have a huge number of loans…even if one assumes their loans go bad at the same rate as others’ loans, they will still appear to have a large number of foreclosures.
NT
Simple Math What am I doing wrong? - Posted by Nicholas Massimo, M.B.A.
Posted by Nicholas Massimo, M.B.A. on November 10, 2002 at 17:46:39:
If a lender will lend 80% LTV (assuming LTV = The actual ?appraised value?) and someone finds that “diamond in the ruff” at lets just say picks it up for 60K with an appraised value of 100K. By obtaining a traditional 80 LTV of 80K (80% of the 100K) wouldn?t that leave the margin of an extra 20K (the 80K loan ? the 60K sale price = 20K) for fix-up and ?down time?? What am I missing here? Please help?
Assessed value is NOT appraised value - Posted by David Krulac
Posted by David Krulac on November 11, 2002 at 12:59:47:
is the property is assessed at $100,000 and apparised at $60,000, most traditional banks/mortgage companies will lend 80% of $60,000 or $48,000.
Some lenders including FHA 203K, and some commercial sources do lend on after repair value, but contractor repair bids must be submitted to the lender who give “draws” on the loan like it would for new construction.
David Krulac
Central Pennsylvania
Re: Simple Math What am I doing wrong? - Posted by Dave T
Posted by Dave T on November 10, 2002 at 22:21:48:
My lender will only give me purchase money on 80% of the contract purchase price. However, after I have purchased the property and the title is recorded in my name, my lender will refinance the property up to 90% of the appraised value. Title seasoning required: One day.
Re: Simple Math What am I doing wrong? - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on November 10, 2002 at 18:31:39:
Nicholas Massimo–MBA-------------
You are correct IF. If the lender will loan on the appraised value. Usually lenders will loan on the lesser of either the appraised value or the purchase price. It is possible to find lenders who will go by the appraisal, but not easy. You need to talk to mortgage brokers and maybe other investors who do fixeruppers to find such lenders.
Private party investors, also known as “hard money lenders” might loan up to about 60 or 65% of the after-repaired market value. They tend to charge high fees and high interest rates, but may not consider the buyers credit scores.
If the property is in rough shape, many lenders will not want to loan on it. There are some lenders who will make construction loans for such a property. And, if you are going to live in it yourself, there is a government loan program that will pay for buying and fixing, with a contractor to do the fixing. This is a HUD program called, if I recall correctly, a 203k loan.
Now the hard part is the finding of a property for 60% of value. When you can do that consistently, you will be minting money.
Good InvestingRon Starr***
Re: Simple Math What am I doing wrong? - Posted by John VA
Posted by John VA on November 10, 2002 at 18:25:08:
Most lenders lend on the lesser of either sales price or appraised value. So even if it’s appraised at 100k, if you buy it for 60k, then you’d be doing it 80% of 60k, or 48k. Depending on credit issues and whatnot, you should be able to do better than 80% LTV when purchasing a home. In either event, that equity would still be in the home for you after the purchase.
Any chance that they’re nation wide? - Posted by js-Indianapolis
Posted by js-Indianapolis on November 11, 2002 at 10:31:11:
I’d love to find a lender in my area that will refi in one day. So far, I’ve got a bunch that will do so in 6 months, and one that “might be able to” in 3 months.
Can your lender do business nation wide? Or at least in Indiana?
thank you - Posted by Nicholas Massimo, M.B.A.
Posted by Nicholas Massimo, M.B.A. on November 10, 2002 at 18:31:05:
Nick (NJ)
Re: Any chance that they’re nation wide? - Posted by Dave T
Posted by Dave T on November 11, 2002 at 10:39:11:
Countrywide Home Loans. The refinance will likely take longer than one day. What I said, is that they only require that my name be on title at the courthouse when I apply for the refinance loan. Therefore only one day of title seasoning is required before I can refinance.
Re: Any chance that they’re nation wide? - Posted by js-Indianapolis
Posted by js-Indianapolis on November 11, 2002 at 14:59:17:
That’s funny, usually one (out of the 6 or so) foreclosures that make it to sheriff’s sale here each week is one of their loans. Coincidence? Hmm…
Makes me think they might be changing their policy in the future.
Re: Any chance that they’re nation wide? - Posted by Nate(DC)
Posted by Nate(DC) on November 11, 2002 at 12:53:29:
Also, Washington Mutual and World Savings will do no-seasoning refis. Additionally any Freddie Mac loan does not require title seasoning to be sold to Freddie (though the lender may, or may not, have their own requirements on top of that).
NT