Can I Take Out A Second If I Am Not On The First?
I have the opportunity to purchase (quit claimed to me for some cash) several condos and assume the construction loans from a motivated developer. Each condo will have approximately 30k of equity in them after the purchase and the developer will remain on the first(the construction loan).
I want to pull some cash out of these properties, but can I take out a second on these properties when I am not on the first?
Thanks in Advance,
Jeff
You don't need to be on the 1st to be on title. (subjet to).
If you are on title, you should be able to get someone to lend you money if there is enough equity.
If you assume the 1st, you ARE on the 1st, by detailed and specific agreement with the lender.
You will have specifically assumed and agreed to be responsible for the payment of the 1st according to its terms.
While the original signer is still on the note, now you are too, so lender has 2 folks who've agreed to pay the loan.
If you take "subject to" and you do NOT assume (liability) for the 1st, but you do hold title, then yes you can borrow on a new 2d, assuming you can find agreeable lender. But be aware, that if such a loan is made, it could be in violation of the DOS clause in the 1st, and trigger a foreclosure of the 1st...which could ruin your whole day