Clear Title As Collateral
my wife and i will have free and clear title to a fixer upper in one month. we are paying all cash so there wont be a mortgage hanging over our heads. we need funds to fix up the house and dont have good credit so we have to use the cash we have just to buy the place. the tax value is 41,600 and the former owners were able to borrow 66,400 on the house but we simply need 15,000 to do the repairs ourselves. im sure any lender could see the security in using the house as collateral even if we dont look dreamy on paper. is it unreasonable to assume we can get started with our investment career with no (or not so good) credit, being self employed (not so easy to show proof of all income) limited cash (throwing it into buying fixer upper), but having free and clear title to a house that should be in high demand? never done the hard money route, will that work for us, are there lenders that will fund our repairs?
i dont believe a bank is going to care how much we grovel and beg for fix up funds, they have too many regulations to adhere to. it seems as though even if you have a million dollar property thats free and clear if you dont meet their criteria their bosses wont let them give you 10 bucks. their common sense isnt allowed to be used, its against the rules. so, we are hoping to find a private investor that would like to hold a house as collateral thats worth at least 3 times what we need to borrow. it can be paid back with very high profit upon resale. any private investors in south-central or western virginia that are possibly interested? we could just fix it as we go along through the year but we want to rehab it faster than that and resale quickly, the time is good for that in this area.
At the risk of sounding ignorant, what does it mean to be "red tagged" by the city? We have the city inspectors coming next week and we were a little late in pulling the permits and I am curious what kind of a nightmare we are in store for. Thanks!
There are no dumb questions here
Red-tagged means that the home was condemed by the city due to structural problems, vandalization, etc.
lead paint is another reason our city tagges or we call them red flags a house. can be a big problem when the health department is involves and wants you to do everything there way.
This is a very costly mistake when ever any work is done in any of my places I listen to what the contractor says and then I say ok write up your quote and fax it to my office and I also let them know I am putting the job out to other contractors also.
Another thing I do is call the permit/inspectors office and ask them if they know of such and such a contractor and see if they have had any dealings good or bad with them.
Problem is you have a job done and nothing is in writing its nothing more then your word against his.
You might just half to bite the bullet on this one one thing that you coudl do is say you will pay him once it passes inspection but no matter what you do get it in writting.