More Seasoning With Your Flip Mr. Lender?
I am hearing, reading REIs stating that mortgage companies are not approving loans to buyers on properties which have been flipped.
- Has this been an ongoing concern for lenders or has it picked up momentum lately?
- Has anyone offered to give repair receipts to the mortgage co. of a potential buyer in order to expaln the increase in market value?
- I am a newbie looking to start rehabs, Is this an area that concerns anyone doing rehabs currently?
thank you
wayne
Wayne,
My understanding of this is that it only applies to FHA loans. Just make sure your buyers are pre-approved for conventional loans. I'm not sure about providing repair estimates and photos to show the work, but you can ask your local banker how FHA handles it.
Not to worry. There are many lenders who will do no seasoning loans. You need to find one that specifically offers "no seasoning" loans. Just start calling some brokers listed here and I am sure you will find some. They may or may not ask for receipts, ususally not, since a new appraisal will have to be done anyway and will have to support the sales price. The loan is done on the lower of sales price or appraise value.