Will I get enough to cover closing costs? - Posted by Jim C

Real Estate Investing
1

Posted by Jim LaVerdi {Phx_Az} on December 06, 2000 at 23:03:31:

Jim.

Closing costs vary from property to property. It is determined by the value of the house.

The Lender will be loaning you 50-65% LTV so in order for you to get that extra cash you are
claiming to need, I would make my offer to the seller lower than what you are able to get from the lender.

EXAMPLE:____ If the house has an ARV of $100,000.00 I would not be offering any more than say 55,000.00 as an all cash offer thus giving me a $10,000.00 cash in pocket closing… or adjust those numbers to fit your needs. . Of course the property will need considerable repair needed, and the owner should have equity for this to work at this price tag.

If the owner should have an existing encumbrance of say $88,000.00 then you are basically S.O.L. as far as an all cash offer goes (Unless it comes from your bank account) OUCH! The hard money lender won’t touch that one.

Also if the property doesn’t need much repair, then it would be up to you to determine the motivation of this seller to move it quickly for your price tag.

Hope this helps.

Jim LaVerdi {Phx_Az}

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Will I get enough to cover closing costs? - Posted by Jim C

Posted by Jim C on December 06, 2000 at 18:57:45:

Will a Hard Money Lender give me extra money along with the 50-65% LTV to cover closing costs?

And how much are closing costs usually?

Thanks.

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Re: Will I get enough to cover closing costs? - Posted by dewCO

Posted by dewCO on December 07, 2000 at 22:36:30:

You make allowance for those costs in the money you borrow–you roll it into the loan. You can even roll in the first payment or two or three, IF you have room in the LTV percentage.

Costs are: points 3-5 (percent of the loan amount)
underwriting fee $300
and whatever else they throw in
(Ask the lender and shop them!)
Plus the “usual” closing costs, if you are paying for them: title work, title closing/excrow fee, etc.