No Down Purchase Of Quad By Newbie
I would greatly appreciate any thoughtful advise for a first time buyer who has found a quad (2 duplexes next to each other) but has basically no cash to put down. The units need "revitalizing" and would then be able to capture 50-60% more rent...the remodeling to be done with the little bit of credit I have and my own contractor skills. But how do I buy this property with no money down?
Have you determined whether the seller will hold a mortgage for all or a portion of the purchase price? If he/she were to hold a second mortgage for 10-20% assuming you have decent credit (or can get someone to co-sign a note) you could get conventional financing for the remaining 80-90%. Alternatively, you might take the title subject to the existing mortgage, give the seller a second mortgage for the difference, assume the payments, and make whatever repairs you need to raise the rents. Once the rents are raised, have it reappraised and refinance.
Thanks for your thoughts. I havn't put an offer in yet, so don't know if they'll take a 2nd. The subject-to sounds interesting, but don't know the mechanics of it. Can you explain?
Check with some of the lenders on this site...thay may be able to get 95% financing and you could either have the 5% gifted to you by family, use credit cards or seller holding a second. If you get a rehab loan or use hard money, you could get the $ to rehab in the loan then refi after a year ( or completion of rehab).